The 'Made in Italy State Seal' to promote Italian excellences
By Cesare Galli
The "Made in Italy State Seal" is here, along with the promotion of the use of blockchain technology for supply chain traceability and new anti-counterfeiting regulations, especially in the agri-food sector, and for the valorisation of Italian excellency on the global market
On Jan. 11, Law No. 206 of Dec. 27, 2023, titled "Organic provisions for the valorisation, promotion and protection of Made in Italy", came into force. This is an extremely articulate text, which, among the many heterogeneous provisions it contains, also includes some regulations likely to positively affect the protection and valorisation of intellectual property, which is the foundation of Italian manufacturing excellence.
The most innovative out of these are the provision in Art. 41, which provides for the introduction of a "Made in Italy State Seal", and the provision in Art. 47, aimed at promoting the use of "Blockchain technology for the traceability of supply chains", but equally important - if its potential is grasped - is the programmatic provision in Art. 22, entitled "Registration of trademarks for cultural heritage institutions". Lastly, the final part of the law should not be overlooked, as they contain some relevant anti-counterfeiting provisions, especially in the agri-food sector.
The institution of the Made in Italy State Seal and the encouragement of the use of blockchain technology to protect production chains in Italy
On Jan. 11, Law No. 206 of Dec. 27, 2023, titled "Organic provisions for the valorisation, promotion and protection of Made in Italy", came into force. Article 41 of the law stipulated that within 90 days of its entry into force, "an official seal certifying the Italian origin of goods" will be established, which will be in the nature of a " legal security card pursuant to Article 2 of Law No. 559" and will consequently be made by the Poligrafico dello Stato "with security techniques or with the use of watermarked or similar papers or other security materials or with magnetic and electronic elements or systems capable, together with the relevant infrastructures, of ensuring suitable protection against counterfeiting and forgery." and the use of which "alone or in conjunction with the term 'made in Italy'" will be reserved for "enterprises that produce goods on the national territory, in accordance with current European Union regulations," and which will be able to affix it, on a voluntary basis, exclusively to the aforementioned goods.
According to these regulations, this seal will not be a trademark, having - like the expression "Made in Italy" - a descriptive value, as such not monopolizable: for this reason, even the combination with this expression of a further sign, evocative of the Italian origin, would hardly have been able to be validly registered and protected outside our country, since the geographical certification mark is not allowed at the European Union level, and even outside Europe it would have been unprotectable in most countries.
Therefore, the project prepared at the time by the Renzi government - and in particular by then-Minister Carlo Calenda and Undersecretary Ivan Scalfarotto - but then not adopted, which envisioned proceeding with a "reversed" approach compared to the one usually followed in these cases, was taken up: that is, instead of establishing a trademark, to identify an official seal of the Italian State, with descriptive value of the Italian origin of the goods, prohibiting its use by anyone for products that did not meet the requirements to enjoy the Italian origin (the last substantial transformation in Italy, under the terms of the Customs Code of the European Union): which is precisely what was done, although not adopting the emblem of the Republic for this purpose, as would certainly have been preferable.
Since it is a symbol of the Italian state, it will fall, not only in Italy, but also internationally, under the general prohibition of registration as a trademark for "coats of arms and other signs considered in the relevant international conventions in force," as well as "for signs containing symbols, emblems and coats of arms that are in the public interest" (art. 10 Code of Industrial Property, corresponding to Art. 7 of the European Union Trademark Regulation, Art. 3 of Directive No. 2008/95/C.E. and, for the part relating to coats of arms, Art. 6-ter of the Paris Union Convention, also referred to by the TRIPs Agreement): this will allow Italy to oppose even abroad the filing as a trademark and the use (which would be of a deceptive nature) of this seal, allowing its use in a purely descriptive function only to those entitled to it.
The fight against the abusive use of this mark by non-legitimate parties, in Italy or abroad, will also be facilitated by the attribution to it of the nature of "paper-values" (a choice also taken up by the Scalfarotto project), the printing of which is exclusively reserved for the Istituto Poligrafico e Zecca dello Stato, an entity that is able to guarantee, through special printing techniques and unique and univocal alphanumeric codes, that it cannot be forged, thus making it less easy to counterfeit, which, moreover, precisely because it would be a state mark, would be sanctioned more severely.
The effectiveness of this new system can be further increased through the wider use of blockchain technology in the management of production chains, first and foremost (but not only) in the agrifood field, which the new law encourages. In fact, it provides, in Article 47, the establishment of a "catalogue", in which will be included "technological solutions that comply with the provisions of ... decree-law no. 135 of 2018" on blockchain technology and will be recorded "infrastructural nodes that meet the requirements dictated by the European Blockchain Services Infrastructure, in order to promote the establishment of a network based on distributed technologies, promoting interoperability with the technological solutions developed within the Italian Blockchain Services Infrastructure".
The blockchain, in fact, although it has found its first and best-known applications in the way of finance and cryptocurrencies, is configured as a decentralized system of "notarization" of individual data, which may concern not only transactions, but also forms and processes, and which, once entered, are essentially unmodifiable (also providing certain dating and geolocation of the entry), since modification would require the consent of all participants in the chain (the "nodes," as they are usually called), which are potentially infinite, thus making supply chains more transparent and controllable and thus reducing the risks of abuse and illegality. And indeed, some consortia for the protection of PDO/PGI products have already integrated blockchain into their control mechanisms: to cite a few Italian examples, Grana Padano PDO, Aceto Balsamico di Modena IGP and Cioccolato di Modica IGP.
Proper contractualization - including on the level of remedies and effective (and enforceable) dispute management - can in fact enable the large-scale adoption of blockchain as a guarantor technology of the digitized document flows exchanged between the parties to a relationship, something of extreme importance both in the increasingly popular Internet of Things and, precisely, in the management of production chains, which with the use of this technology can also be more easily guaranteed by collective and certification marks. The latter today may represent increasingly important added values for the companies that make use of them, communicating through them their commitment to issues such as ethics and sustainability.
This technology will therefore be able to benefit, in different ways, all supply chains and not only those of agrifood products, and particularly those covered by PDO and PGI specifications, all the more so in view of the planned adoption at the European Union level of a similar system also for non-food local typicalities. Precisely with this in mind, Articles 42-46 of the new law provide for a "census" of these typicalities and the preparation by "associations of producers operating in a given geographical area" of "production specifications," being able to draw on a special fund "for the costs of technical consultancy, relating to the qualities and specific features of the product, incurred in the preparation of the production specification".
Cultural heritage institutions’ trademarks and possible synergies with high quality agribusiness and other Italian manufacturing excellencies
Significant positive spin-offs may also come from Article 22 of the law, which encourages "the institutes and places of culture" to register "the trademark that characterizes them" and to "grant the use of their trademark to third parties for a fee", with the double purpose of "increasing the knowledge of the cultural heritage and their own self-financing capacity", as is in fact already provided for "the administrations of the State, regions, provinces and municipalities" by Article 19 of the Italian Industrial Property Code, which indeed refers to "exploitation of the trademark for commercial purposes, including that carried out through licensing and for merchandising activities".
In fact, these provisions allow both territorial public bodies, cultural entities, and PDO and PGI protection consortiums to make the best use of the symbolic elements of cultural heritage related to their territory or institution as a tool to enhance all the positive externalities related to the renown they enjoy, not only by prohibiting all forms of free-riding and parasitic exploitation of it, but also - positively - by allowing them to "monetize" this renown, in particular by granting these signs for use by businesses (particularly those operating in the territory and engaged in sustainable development projects), naturally imposing precise limits on them to prevent the signs themselves from becoming a source of deception, and thus also acting as a driving force for the growth of economic initiatives linked to the local area and to promote its reputation, at the same time promoting that of these cultural institutions, carrying out marketing operations on a global scale, precisely in the perspective of a mutual strengthening of country image and corporate image by combining cultural and productive excellence of the country.
Both the distinctive signs of cultural institutions, territorial trademarks, and PDOs/PGIs (and the corresponding collective or quality trademarks intended to protect them in countries that do not allow their protection as such) are indeed suitable for use in:
(i) targeted licensing operations, not only for merchandising products (such as gadgets or luxury products that can represent them, and today, even tokens that "virtually" represent them, including Non Fungible Tokens, even of an artistic nature), but also for products or services of not strictly "commercial" types (e.g., machine tools or industrial products in general) or, in the case of PDO/PGI for products that do not correspond to the typical ones covered by the PDO/PGI, but which nevertheless have a link with the territory in which the entity operates, particularly (and preferably) in that they are made at least in part in the territory itself, or linked to a craftmanship that the entity encourages, and more generally for which the use of the entity's signs, perhaps together with the trademark, may constitute added value, especially in international markets;
ii) co-branding operations with third parties, aimed at the mutual promotion of the distinctive signs of interest also abroad, exploiting the evocative value of the country and its excellences, cultural and productive, especially if combined;
(iii) creation of synergies with tourist, hotel and restaurant operators located in the places of interest and interested in lawfully exploiting the signs covered by the project;
(iv) creation of promotional and/or cultural events abroad always with a view to mutual promotion, of the territorial signs and those of the licensees or co-branders.
In this way, it is possible to imagine synergies between entities and/or consortia and companies, which translate into business paths in a global perspective, foreign markets and especially the large new markets opened by globalization, being those on which the appeal of traditional products takes on the greatest power of attraction. Indeed, it is precisely economic studies that have highlighted that the relationship between the success of a country's companies and products and that country's reputation is not unilateral, but bilateral, showing how even the corporate image of a country's companies can influence country image, in the sense that the attitude toward a country may change depending on the evolution of the perceived image that that country's products and businesses - but also its cultural goods - have among consumers and vice versa.
As a recent study by Makno also confirmed, if it is true that for a country such as Italy (but the same is true for many other countries, in Europe and outside it) the economic value produced by culture is increasingly relevant, at the same time it is also true that the culture system, in order to be effectively productive on the economic level, and to positively influence the country image, from which all the businesses in a given area can benefit, needs to be networked, accompanied by support services and enhanced with strategic choices.
Intellectual property can thus make it possible not only to devise marketing strategies that make the most of the "country of origin effect", but also to carry out projects that strengthen the country's image, involving within it also the country's companies of excellence operating not only in the sectors just mentioned, but also in the more innovative ones, such as biomedical, mechanical, mechatronic, and artificial intelligence, often among others applied first and foremost precisely to the sectors that have to do with the living, and with all the induced activities that these activities create.
The reinforcement of anticounterfeiting measures
Finally, the new law includes a set of changes to anticounterfeiting rules, which is indeed small (Sections 49-56) but has a potentially considerable and certainly positive impact.
Relevant, first and foremost, are the provisions of Articles 53-54, the second of which simplifies the drafting of the minutes for the seizure of counterfeit goods, while the first makes it easier to destroy them in advance without waiting for the end of the trial, providing, among other things, that it can be done "even at the request ... of the offended person", and that it must be ordered, among other things, "when the violation is evident", with the sole exception of the preservation of samples for investigative needs: this is a measure strongly supported by INDICAM, the Italian Association against IP rights Infringement, which achieves the twofold goal of reducing the cost of preserving seized goods and preventing the risk of their return to circulation.
With the stated aim of "reinforcing the deterrent effect of fines on purchasers of counterfeit goods and ensuring greater involvement of local authorities in the fight against counterfeiting in their respective territories", Article 52 of the law raises these penalties from 100 to 300 euros, an amount that increases the deterrent function of the rule while keeping it within the area of social acceptability, and above all allocates the relevant proceeds in full to the competent territorial authorities. Again to strengthen the deterrent effect of counterfeiting penalties, Article 56 states that "In cases of conviction for counterfeiting offenses provided for in Article 4, paragraph 3, in assessing the foreigner's dangerousness to public order and state security ... for the purpose of adopting the measure to revoke or deny the renewal of the residence permit, account shall be taken of the cooperation provided by the foreigner to the police or judicial authority, during the investigation stage or even after the conviction", establishing a kind of reward mechanism, aimed at facilitating "the identification of those involved in the production and distribution of products or services that constitute infringement of industrial property rights as well as for the identification of counterfeit goods or proceeds from the infringement of industrial property rights", that is, to trace the origins of the counterfeiting chain and strike it in its ability to generate illicit profits.
Under Article 55 of the new law, the counterfeiting of geographical indications or appellations of origin of agri-food products (Article 517-quater of the Criminal Code), as well as that of trademarks and other distinctive signs, will be allowed to use the undercover operations referred to in Article 9 of Law No. 146 of 2006. Likewise, Article 49 equates the counterfeiting of geographical indications or appellations of origin of agri-food products with that of trademarks and other distinctive signs for the purposes of always allocating it to the prosecutor's office in the relevant District Chief Court, the only embryo of specialization in criminal cases, which is flanked (Article 50) with the possibility of including "specific subject areas, inherent to the contrast, in civil and criminal cases, of the counterfeiting of IP rights" among the subjects of specialized training of Judges: on the other hand, neither the concentration of intellectual property expertise, civil and criminal, in a small number of locations, nor, above all, the abolition for the Specialized Divisions Judges of the rule limiting to ten years the maximum period of permanence of a Judge in the division, a rule that disperses an important wealth of experience and knowledge in subjects that instead require them in the highest degree.