I. Identification

1. The Issue

Prosciutto di Parma, or according to the English translation, Parma ham, is a meat product that has fought for its official belonging and recognition since 1999. A need to protect the name Prosciutto di Parma, was triggered by the action of a private firm, Maple Leaf Meats, Inc., from Canada, which has failed to register ‘Parma’ as a collective/certification mark. As a consequence, the Italian producers of the ham from Parma were forbidden to export the ham to Canada under its original name Prosciutto di Parma. The dilemma whether the geographic indications should determine the outcome or the trademarks in this case, is still affecting the busy TRIPS (Trade Related Aspects of Intellectual Property Rights) agenda. The geographic indications define a good that originates in the territory of a Member or a region where certain characteristics of that good are essentially attributable to its geographical origin (Article 22.1). Geographical indications and trademarks as two separate categories under the international protection rights are deeply analyzed by TRIPS. Yet, the exclusivity of either of those two rights is a country-based decision.

2. Description

History of the Consortium

The Consorzio del Proscuitto di Parma was set in 1963 in order to protect the interests of producers, stockbreeders and traders involved in production of the Proscuitto di Parma. This body was also recognized by the Italian Ministerial decree of July 3, 1978, on the basis of Law No 506 of July 4, 1970. Its role was to monitor the geographical indication Prosciutto di Parma and the so- called Ducal Crown, which was its trademark. The Italian claim is that their particular product that carries the geographical indication of Proscuitto di Parma cannot be exported to Canada, since the previously established trademark Parma in Canada would be violated. (Consorzio del Prosciutto di Parma).

The Product

Parma ham is a product of the Parma region of Italy. It is produced according to strict traditional methods and standards. The Italian law even has the special criteria for breeding, slaughtering the pigs, and preserving the hams to the methods used in curing the meat. Parma ham is made from the rear haunches of animals weighing at least 160 kg, and which are aged at least nine months.
The ratio between lean meat and fat is optimal. Only pigs with the certain ‘pedigree’ can become to be Parma hams. They have to be born within the approved areas and selected farms; they should spend at least four months in north-central Italy. The diet consists out of maize, barley, cereals and most importantly, whey from Parmigiano Reggiano cheese production that makes the pigs fatter and more tasty than in other regions.

The meat processing is divided into the ten stages. The first stage consist out of cutting. Before cutting, a pig has to be healthy, rested and have fasted for 15 hours. Then, in the second phase of cooling, the insulated leg is put in special cold stores where it stays for 24 hours. The reasons for cooling is to lower the leg temperature from 40 C to 0 C for hygiene reasons and to firm up the meat throuugh the cold temperature. The leg undergoes a weight loss of about 1 % during this phase.

The ham's typical ' chicken leg' shape is achieved through trimming phase, by which some fat and pigskin are removed. Besides the aesthetic reason, trimming aslo helps the following salting phase. Legs even with the smallest faults are removed. The leg loses 24 % of its weight in fat and muscle. After the leg is cooled and trimmed, it is sent from the slaughter-houses to the curing houses. The uniform temperature of the leg is very important in this phase, since a leg which is too cold does not absorb enough salt, as a leg which is not cold enough may deteriorate.

The fourth stage, salting, involves applying of both humid and dry salt: the pig skin is treated with humid salt, while the muscular parts are covered with dry salt. After that, legs are placed in a cold store at a temperature ranging from 1C to 4 C with a humidity level of about 80 %. The stage "of first salt" takes for 6 to 7 days; legs are then taken out and the residual salt is removed. They are again covered with a thin coat of salt. Then, legs are put in another cold store called "of second salt," where they stay for 15 to 18 days, depending on their weight. At the end of this phase the weight los is of about 3.5 % - 4 %.

The fifth phase involves rest. After removing the residual salt, the legs are moved in the rest store for 60 to 70 days with a humidity level of about 75 % and at a temperature ranging from 1 C to 5 C. The goal of this phase is to allow the ham to breathe without becoming either too wet or too dry.

The sixth phase of washing-drying involves washing ham with warm water to eliminate possible salt and impurities. The drying last about one week either under natural conditions during sunny, dry and airy days or in special dryers. Pre-curing is the phase in which hams are hung on special wood frames called "scalere" in large rooms windows on ether side. The most important element during this phase is the airflow regulation that is controlled based on the ratios of internal/external humidity and internal humidity/product humidity. That allows for a gradual drying of the hams; it lasts about three months. After this phase the ham is beaten to improve its round shape. Weight loss during this phase is about 8 % to 10 %.

Greasing is the eight phase in Parma ham processing. The cavity around the bare part of the bone, the uncovered muscular mass and possible chaps are covered with lard. Lard might contain a mixture of minced pig fat, some salt and pepper and sometimes ground rice. The purpose of 'larding' is to soften the superficial muscular layers so that the external layers do not dry too fast.

In the curing phase, which is the ninth stage, the ham is moved to the 'cellars,' rooms with less air and light. This stage indicates the 7th month of the ham's life. A horse bone needle which absorbs the products fragrances is inserted in different parts of the ham. According to the smell of that needle, experts can verify the development of the production process. The weight loss during the curing is about 5 %.

The final phase in the ham production is called branding. At the end of the ageing period, which is a minimum of 10 months for hams weighing from 7 to 9 kg and 12 months for those weighing over 9 kg, the ham has lost about 28 % of its initial weight. The official stamp of certification, the fire-branding with the ducal crown, finalize the ham production. The stamp is an official proof and guarantee that all the processing stages have been carried out correctly. (Consorzio del Prosciutto di Parma).

What's the difference?

The Canadian ham production is significantly different from the traditional method applied for producing the Prosciutto di Parma. The differences between the hams are that the Canadian hams are cured for only 8-9 months. They are also distinguished as more salty and smaller. (Paolo Gazzoti, Elisabeth Cavaero).

This is not about protectionism. It is about fairness, were the words of EU commissioner Franz Fischler and the motto of the European Union member states at the WTO trade negotiations, first in Doha and later on in Cancun. The EU has pushed for 41 food products that need a protection in the international market, in order to avoid cheap imitations by other producers. The main argument was that borrowing of the original products’ names could ruin the reputation of high quality products from the European Union. Geographical indications are measures that offer the best protection to quality products, which depend on their origin and reputation. According to the Article 22.1, geographic indications identify a good as originating in the territory of a Member, or a region or locality in that territory, where a given quality, reputation or other characteristic of the good is essentially attributable to its geographical origin.

Parma ham certainly deserves to be on the list according to the Consorzio members, since the quality and a proper presentation of Parma ham on the international market can be achieved only if produced, sliced and packaged ham originates from the Parma region. To Parma ham producer’s advantage, the EU law extended its protection of Parma ham by regulation (EEC) No 2081/92, which distinguishes two classes of names: Protected geographical indications (PGI) and protected designation of origin (PDO).
PGI and PDO

PGI AND PDO

Protected geographical indication (PGI) according to EEC No 2081/92 means the name of a region, specific place or country describing a product originating in that region, specific place or country and possessing a quality or reputation which may be attributed to the geographical environment with its inherent natural and/or human components.

Protected designation of origin (PDO) means the name of a region, specific place or country referring to a product originating in that region, specific place or country and whose quality or other characteristics are essentially or exclusively due to a particular geographical environment. (WTO, Trips: Geographical Indiacations).

Disagreements

The major dispute between Parma ham producers from Italy and Canada involved not only PGI and PDO issues, but also a trademark dispute. In the Canadian case, the Ducal Crown mark is the official stamp of certification from Italy that proves the ham is from Parma. Italian producers cannot sell their product under the name Parma ham because Canadian ham producers have registered their domestically produced ham under the name Parma since 1971.
The Canadian legal system provides for protecting geographical indications in Canada for products such as wines and spirits only. The basic claim of Consorzio was that Canada has been giving legal protection to a trademark, which deceives consumers as to the nature, manufacturing process and characteristics of the ham.

Outcomes

Consorzio has submitted so far three applications for the trademark. Parma ham was filed on October 19, 1984, and was objected by the Canadian Trademark Office (TMO) on February 4, 1985 with the explanation that Maple Leaf Meats Inc. already registered the trademark. Prosciutto di Parma was also filed at the same time and objected with the same reasoning of already having a registered brand. The third application was Ducal Crown mark application that was filed and objected in the same period as the previous two applications. However, the decision was amended, and TMO was persistent in its objection until January 1998. Although all three applications were objected to, they have not yet been formally rejected.
Since the Canadian measure of regulating trademarks is internal, there should not be any allegations, according to Canada, of violating Article XI.1 of the GATT 1994, which implies that Canada prohibits imports of cured ham under the geographical indicationsProsciutto di Parma. Whether the registration of the Parma trademark in Canada was fair and valid at the time of registration, is still a subject of discussion in the Canadian Federal Court.

By just saying intellectual property rights, one would hardly relate that term to food products. However, the WTO Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS), which was signed on January 1, 1995, was established in order to protect names of particular food products associated with certain geographic locations (Food Geographic Indications). Although TRIPS article 24(1) requests WTO member states to enhance the general level of protection for geographic indications, it does not imply how this should be accomplished. The holes in TRIPS’s loose structure motivated the EU to pass an extended geographic indication protection on July 14 1992 under the regulation (EEC) No 2081/92 (the Origin Regulation). (Judson O. Berkey, Asil Insights).

Consorzio del Prosciutto di Parma promotes Parma ham as a gem in the culinary tradition of Italy. It is responsible for its ham quality, uniqueness and compliance with the rules of tradition, so that consumers know that they are buying a genuine product. Geographical origins that are contributable to the quality of Parma ham are: accurate selection of pigs, location of pig-breeding farms in a well-defined area and specific climatic conditions that are unique to the hills around Parma. All these indications justified Consorzio’s requests for the protection granted by geographical indication provisions.

The dispute with Canada has been comprised of four aspects. The first aspect has been drawn out of the Canadian negligence to register the Prosciutto di Parma as collective mark. Secondly, there has been intention to obliterate the Canadian trademark from the Canadian Trademark Register. Thirdly, there has been notion that there were not appropriate legal remedies to relieve the unfair competition caused by the use of the trademark Parma by Canadian national producers. Finally, and probably the most economically hurtful aspect for Italy was the prohibition to export hams titled with the geographical indication Prosciutto di Parma, because Canadian already registered their domestic ham under this name.

The Parma trademark used on domestic Canadian ham is definitely misleading to the public. Most Canadian consumers, according to Maple Leaf Meats Inc. surveys, had not related the word Parma with Italy. However, the survey conducted by Consorzio del Prosciutto di Parma, claimed that if one mentions the food products during the interviews, most people would associate that term with Italy. Moreover, when the Parma meat packaging displays the national colors of Italy, a strong majority of the market comes to the conclusion that that product must come from Italy. Even worse, the Canadian Parma has carried the label written in Italian, which can easily confuse even a better- informed Canadian consumer. Therefore, the Canadian trademark is not only similar or identical to the Italian geographical indication. It also misleads the public in regards the origin of the product. It is very difficult to judge the case adequately, since the TRIPS articles 22.3, 24.5, and 24.8 are conflicted in terms of their overlapping with the geographical indications and trademarks. (Societa Italiana Brevetti, 94').

It is understandable for the Italian ham producers to fight for their product, because it is a high quality product, characterized with the special aroma achieved with the strict meat curing methods. The lower quality Canadian ham that is most likely associated with the original Parma ham can damage the reputation of the proud Italian product.

The production of cured meat was always an active branch of the meat industry in Italy. Thanks mostly to the successful outcome of promotional campaigns and the increasing respect for the Italian quality, the exports of cured meat increased in recent years. Export in 2002 marked 79,500 tons of exported cured meat with the profit of 589,700,000 euro. (Istituto Valorizzazione Salumi Italiani).The export of Prosciutto di Parma has grown by 1 %, due to increased demand in countries of Northern Europe, Canada and Japan. The foreign market represents 17.8 % of the production. (see Table 1)

Table 1 : Export increase in 2002 from Italy

The United States is confirmed to be the main importer of Parma ham besides the European Union countries. The Italian ham companies distributed to the United States approximately 1.800.000 kg of product. However, the export of Parma ham to Switzerland, Germany and South America has not seen the wanted results. The drop of exports in Switzerland (- 18.7 %), Germany (- 8.3 %), and in South America, particularly Argentina (- 86 %), was due to economic crisis. Pre-sliced ham has achieved significant results in the foreign market; it represents 19 % of Parma ham exports. In particular, the countries such as Sweden, Norway, Belgium and Great Britain are leading countries in the importing of pre-sliced ham.

Table 2: EU Pork Production by Member State

Source: USDA/FAS

Table 3: The Biggest Importers of Parma ham

Table 4: The export of the Parma in U.S.A.

Raw Prosciutto of Parma; Perexsuctus: 2000 years of dolcezza.

17. Impact of Trade Restriction: Moderate

18. Industry Sector: Agriculture

Italy could be best described as a country with the prevalence of hilly and mountainous terrain. Total land area occupies about 30 million hectares, from which only 23% is made up of lowland and this figure is unequally distributed in the South with 18% and in the central regions with 9 %. Agriculture contributes about 2.5 % of the total economy, employing about 2 million workers. The northern part of Italy (Emilia-Romagna, Lombardia, Liguria, Piemonte, Veneto, Trentino-Alto Adige and Valle d’Aosta) produces: cereals, milk, cheese, fruit, vegetables, sugar beets, flowers, grape-wine, industrial crop and meat by products. The Central part (Marche, Abruzzi, Lazio and Tuscany) has rather more heterogeneous structure by producing cereals, grape and wine, olives and oil, animal husbandry, fruit, vegetables, flowers and industrial crops. Southern Italy (Campania, Molise, Apulia, Basilicata, Calabria, Sicily and Sardinia) is focused more on production in cereals, cattle, sheep, olive-culture, viticulture, orchard, citrus fruit, flower and fruit culture. (Embassy of Italy Agriculture).

Table 5: The regions and agricultural production

22. Resource Impact and Effect: High and Product

23. Urgency and Lifetime: Low and 20 years

24. Substitutes: Like Products

VI. Other Factors

‘Let the best ham win’ is the slogan that about 200 ham producers in Italy, framed with the name the Consorzio del Prosciutto di Parma, lobby for. The traditional way of producing ham in Parma lies on the hearts of many Italian producers. Culture, as a strong link to the environment, has dominated the claim of Parma ham producers that pig farming in Central and Southern Italy started in Etruscan times and has continued to the present time. The Parma region has the unique ecological, climatic and environmental factors that enrich the air coming from the Versilian Sea with the chestnut-perfumed aroma that gives Parma hams their original flavor.

Parma Di Prosciutto, undoubtedly, is one of the most protected products registered as a PDO (Protected Designation of Origin) under Regulation 281/92. This regulation also entails the notion that the Parma Ham Consorzio should fully oversee any aspect of the slicing and packaging process, in order to assure customers that they get the expected quality. Using this rule, the Consorzio complained against Asda stores, Ltd. in the United Kingdom that they sliced and packaged Parma ham unsupervised and sold it under Parma ham, thereby endangering the authenticity and quality of Parma ham.

Consumer information and protection were factors that the Consorzio used in the battle against Asda. The consumer will receive the promised quality by one’s willingness to pay a higher price for Parma ham. The Asda stores stopped packaging and slicing ham in the UK after the ruling of the Court in advantage of Parma ham producers in Italy. The goal of Asda stores was to reduce packaging costs, yet they may slice the ham only on the counter in the front of the customers. By cutting and packaging of Parma ham in the UK, Asda’s shoppers would save about 61% on the product. The Asda’s allegation was that Italian producers have anticipated an increase in the price of Parma ham, and that the Italian law is not applicable in the UK.

On the other hand, the members of the Consorzio were delighted with the Court decision. After exporting 6 million packets of pre-sliced Parma ham to the UK, each one was controlled by independent inspectors and marked with the Parma Dual Crown. Sales to British consumers have increased by 65 % in three years. Export sales marked 420 million euros in 2002.

Parma ham industry employs approximately 3,000 people in 189 companies. In order to protect their employees, whose well- being depends not solely on domestic consumption, the Consorzio is willing to bring violators of PDO’ rules, which include packaging and slicing out of region, to Court. The effects of the European Court Justice decision are twofold. On the one hand it encourages the ham producers to set prices of ham higher on international market, yet the international buyers are carrying the burden of the geographical indication protection.

Whether the best ham will win depends on consumer’s willingness to pay the asked price. How the culture is important to the member states of the European Union can be explained with several arguments. The quality rather than quantity is the major claim of the EU, since only with high quality product is it possible to compete in international markets. Secondly, it was estimated that EU consumers highly appreciated PDOs as represented by 1999 consumer surveys, which imply that 40% of consumers are ready to pay a 10% premium price for origin-guaranteed products. In the case of Parma ham, the Italian producers demand to call their product ‘Parma ham’ and not ‘No. 1 Ham,’ in order to comply with the original idea of preferring quality against the quantity aspects and to link their product with the geographic belonging. In addition, unsupervised slicing and packaging of ham out of the region would, according to Parma ham producers, damage the originality and quality of ham. (Europa Trade issues).

Parma region comprises about 80% of ham regional production. The area is famous for its agricultural and industrial sectors. A decentralized system provides possibilities for the farmers to promote their products as best as they can. The well- organized and powerful Parma Ham Consortium organized several promotional activities in Europe and the United States in 1994. They provided consumers with color ads in prosperous consumer magazines. The other action sponsored by the Ministry of Agriculture involved a promotion of an information folder on the characteristic of Parma Ham, and brochures on how to use and preserve Parma ham. With all those initiatives even the consumers from the Northern part of Europe have started to show more appreciation to the products from Southern Europe. The Consorzio does everything in its power to protect Parma ham. Since even the consumers in Great Britain are ready to pay the higher price for a genuine product, in this case Parma ham, both consumers and producers seem to be in a win-win situation.

The role of Parma ham in Italian cuisine

Processing of pork into cured meat products draws on a Ialian heritage of culture and tradition since the ancient times. The first exports of hog's rear legs preserved with salt occured in Etruria as early as the 5th century BC. The pigs became one of the main economic resources in Italy during medieval times. One can say that the art of processing and preserving pork was then developed and perfected. The Renaissance helped to promote the cured pork even better. Served at the numerous banquets, cured pork gave rise to countless, creative specialties throughout the country.

The "heavy hogs" raised in Italy provide the products of outstanding quality reffering to nutritional value and organoleptic quality, which differs from the meats obtained from the so-called light pigs. Parma ham is an easily digestible food and it is better for one's digestive process than other meats, according to food and diet scientists. The product is rich in free amino-acids, more than 12 % of the total protein content. 100 g of lean Parma ham contains valine (198.5 mg), leucine (268,7 mg) and isoleucine (175 mg). For people, who uses up a lot of energy, Parma ham is an excellent source of energy. Mineral content of 100 g of Parma ham consists out of 1/4 to 1/6 of the daily phosphorus requirements and potassium, irons and zinc.

A simple dish : parma ham and melons (Paul Vincent: Head Chef)

Start by cutting off the top and bottom of the melon then, carefully with a sharp knife, cut off the rest of the skin. Next cut the melon in half and remove all the pips. Cut thin wedges and wrap each with the thinly sliced Parma Ham. This can be done a little in advance as long as you cover it and put in the fridge or it will dry out.

To serve, again is simple, and comes down to choice. Here I have dressed the plate with a ring of skinned, sliced orange. In the centre of the ring is a small mound of mixed lettuce. As well as flavour and colour this adds something to rest the melon against to stop it sliding all over the plate. I have put a sprig of fresh dill in the centre to add color and height and drizzled a little fresh basil oil around it to finish the dish.

It really is that simple to serve as a favourite starter or as a light lunch.

Bon appetit

1. Paolo Garzotti, Elisabeth Cavarero. Report to the trade barriers regulation committee. TBR proceedings concerning Canadian practices affecting Community exports of Proscuitto di Parma. europa.eu.int/comm/trade/issues/respectrules/ tbr/cases/can_pro.htm

2. WTO talks: EU steps up bid for better protection of regional quality products. IP/03/1178 Brussels, August 28, 2003. www.ictsd.org/ministerial/cancun/docs/EC_GIs.pdf

3. European Union: Case Law. Parma Ham Consortium Files Obstacle to Trade Complaint Against Canada. (Source lost)

4. R. Taylor Moore. Geographical Indications: An Overview of the Arguments Surrounding Protections 2003. www.idfa.org/news/stories/2003/09/fasreview.pdf - Sep 9, 2003

5 . Burkhart Goebel. Geographical Indications and Trademarks: The Road from Doha. Worldwide Symposium on Geographical Indications. WIPO and USPTO. San Francisko, California, July 9 to 11, 2003. http://www.wipo.org/meetings/2003/geo-ind/en/documents/pdf/wipo_geo_sfo_03_11.pdf

14. SCADPlus: Protected geographical indications and designations of origin. Activities of the European Union. Summaries of legislations. 11/19/02. http://europa.eu.int/scadplus/leg/en/lvb/121097.htm

15. Paolo Garzotti, Elisabeth Cavarero. TBR proceedings concerning Canadian practices affecting Community exports of Prosciutto di Parma. Report to the trade barriers regulation committee. Brussels 99.
http://europa.eu.int/eur-lex/en/conslag/main/1992/en_1992R2081_index.html

16. Judson O Berkey. ASIL Insights. Implications of the WTO Protections for Food Geographic Indications. April 2000. http://wwwasil.org/insights/insigh43.htm

17. Paul. Vincent. Parma Ham and Melon Salad. The recipe of the month. March 2003. http://wwwlchurchhouseconf.coo.uk/rotm/2003-03.shtmlp