The Effects of Institutional Measures: Geographical Indication in Mercosur and the EU

Abstract

As agri-food markets become increasingly specialized, governments are provoked to provide these products legal support to protect their supply and trade sources. After several treaties, the Trade-Related Aspects of Intellectual Property Rights (TRIPS) Agreement was signed in 1995 as the broadest ever reached. The agreement allowed Geographical Indication (GI) of agri-food products to be targeted. The GIs of Mercosur and the European Union are very different in absolute and relative numbers, showing evidence of significant institutional participation difference. Thus, this work aims to compare the effects of institutional mechanisms promoted by Mercosur and the EU on this market by establishing an analysis framework based on the respective laws and agreements against demographic data. The results show that adherence to TRIPS is a necessary condition but not sufficient for its development. Adherence to the Lisbon Agreement also strengthens the capacity to sustain a substantial GI market. Additionally, the standardization of regulatory treatment and interventionist action helps stabilize and promote institutions in the GI market. Finally, this study concludes from the EU and Mercosur cases that a more robust, promotive and uniform system through its legal basis and dedicated structures results in more trustable institutions and potentially a more abundant market for GI products.