Using Quality Standards as an SMEs Competitive Advantage: the Role of GIs, Certification TMs and Collective TMs Using Quality Standards as an SMEs Competitive.

Using Quality Using Quality

Standards as an SMEsStandards as an SMEs Competitive Advantage: Competitive Advantage:

the Role of GIs, the Role of GIs, Certification TMs and Certification TMs and

Collective TMsCollective TMs

PRESENTED AT PRESENTED AT WIPO – ITALY INTERNATIONAL WIPO – ITALY INTERNATIONAL CONVENTION ON INTELLECTUAL PROPERTY CONVENTION ON INTELLECTUAL PROPERTY

AND COMPETITIVENESS OF MICRO, SMALL AND AND COMPETITIVENESS OF MICRO, SMALL AND MEDIUM-SIZED ENTERPRISES (MSMES)MEDIUM-SIZED ENTERPRISES (MSMES)

bybyGetachew Mengistie, Intellectual Property Law Consultant Getachew Mengistie, Intellectual Property Law Consultant

and Attorneyand Attorney

Rome, December 10 and 11, 2009Rome, December 10 and 11, 2009

IntroductionIntroduction• GI, TMs, certification and collective marks are useful marketing tools • They help to :

distinguish a certain product from similar products, capture and further build good will and reputation of Distinctive products improve competitive position and enhance earnings

• GI, TMs, certification and collective marks are are commonly used as marketing tools by companies in the developed countries and the newly industrialized countries

• Dcs can successfully use similar tools-this evidenced by the Ethiopian Fine coffee designations trade marking and licensing initiative

Introduction Contd.Introduction Contd.• Initiative started in 2004

• Initiative is led by Stakeholders committee & facilitated by EIPO

• Initiative has Technical & advisory support from LYIPFree Legal Support from Arnold & PorterFinancial support- Donor organizations, stake holders & the

government

• Purpose and scope of presentation-highlight the grounds, objectives, Choice of appropriate legal, business and marketing tools, major achievements and Lessons learned

Grounds for the InitiativeGrounds for the Initiative

• Ethiopia produces some of the finest coffee in the world

having Distinct flavor and aroma Can be distinguished from coffee of other countries

• The Fine coffees have been recognized, identified and sold by Coffee Designations/ brand names as “ Harar’, “Yirgacheffee” and Sidamo”

Grounds Contd.Grounds Contd.• Little return from the Specialty coffee

High retail price-example 2004-Harar $24/lb, 2005 Sidamo-$26/lb Only 5-10 percent comes to Ethiopia Fluctuation of price of coffee

• Impacts of low price of coffeeunable to meet basic needs, school, health etc Cutting down coffee trees and planting chat

• Cases of misappropriation or attempt to misappropriate coffee names

Objectives of the InitiativeObjectives of the Initiative• Ensure Ethiopia’s ownership of coffee brands

• Increase Income of Poor farmers & Exporters

• Create & Strengthen partnership with Foreign Coffee importing, roasting & distributing Companies

• Building IP Asset Protection & Management Capacity

Trade marking of the Fine Trade marking of the Fine coffee brandscoffee brands

• TM Applications filed in 36 countries• Trade mark registration for three of the coffee

designations secured in 29 countries and two of the coffee designations are protected in one country

• Applications are pending in the rest of the countries

• TM registration only meets one of the objectives set

• Need for Business strategy• Stake holders opted for Licensing

Licensing of Coffee TMsLicensing of Coffee TMs• The Licensing program aims at

Facilitating the use of Ethiopian Trademarks Capturing the reputation & good will of fine coffee

around the trademarks Establishing & strengthening partnership with the

coffee importers, retailers & distributors Catering to the interests of the key actors etc., Promote the Ethiopian fine coffees

• License agreement is made simple and clear• License is offered free of royalty• Obligations of Licensees

Licensing contd.Licensing contd.• Negotiated license agreements with 96 foreign coffee

companies and 50 local coffee exporting companies and coffee producers unions.

• Example of use of the Trademarks

Branding Trade MarksBranding Trade Marks

• Need for Marketing strategy• Stakeholders opted for branding• A UK based branding company employed• Brands and brand guidelines developed under

supervision of the Stakeholders Committee• Stake holders decision and unveiling of the brands

on May 2008• Brand guideline approved in July 2008

Umbrella BrandUmbrella Brand

Individual BrandsIndividual Brands

Impact of the InitiativeImpact of the Initiative• Strategy helped to:

differentiate the Ethiopian fine coffees from the coffee of other countries

build confidence and Improve bargaining position of coffee producers and exporters

Enhance the demand of the Fine Coffees

• Improved negotiating and Marketing Position-power to control, require disclosure of sales information, joint promotion, uniform branding and negotiate export price

Impact contd.Impact contd.

• Increased demand, rise in the price of coffee and income of coffee producers /export income of the country

• Encouraging Change in the lives of Producers-housing, sending children to school etc.

• Contributed to an increase in export earning – ex. 2007-2008 • Greater recognition of the value of intellectual property assets

and the need for protection in Ethiopia• Stimulated other countries to embark on a similar initiative

•

Lessons LearnedLessons Learned• Top Leadership Support & Direction is critical for

success

• Need for initial technical, financial and legal support from international partners while simultaneously building the requisite capacity for IP Asset identification, protection, exploitation & management

• Ensure ownership and involvement of stake holders

Lessons contd. Lessons contd. • Significance of public & private partnership

• wining the support of as many partners as possible

• Preparatory works, advance planning and regular evaluation

• Use foreign companies that buy the cause of initiative

• Seek for a win-win situation

ConclusionConclusion• GI, TMs,CTMs, CTMs may be used as a significant

marketing tool• Ownership of TMs, GIs, CTMs or CMs not enough-

need to develop and implement business and marketing strategies

• Need to devise strategies to establish and strengthen partnership with foreign companies

• Need to develop IP assets management capacity

Contact AddressContact Address Getachew Mengistie

 IP Law Consultant & Attorney 

P.O.Box 4706Addis Ababa, Ethiopia

Tel-251-11-6183571 (office)Fax 251-11-6183563

E-mail- [email protected] 

Thank YouVer y Much