[Guest post] BASMATI trade mark refused registration in New Zealand

Basmati rice is a well-known and well-loved food around the world. But given its transnational origins across at least India, Pakistan and Nepal, should the word BASMATI be locked down for exclusive use by any one entity in a particular country? In Agricultural and Processed Food Products Export Development Authority, Ministry of Commerce and Industry, Government of India [2024] NZIPOTM 26 (27 June 2024), the Intellectual Property Office of New Zealand explained why it should not.

In February 2019, the Indian Agricultural and Processed Food Products Export Development Authority (APEDA, part of the Indian Government) applied to register the word BASMATI as a certification mark in New Zealand for “rice” in Class 30. ADEPA is the Indian statutory authority responsible for representing the interests of Indian companies and individuals involved in the growing, processing and exporting of agricultural products, including basmati rice.

For those who are less familiar with certification marks in NZ, applications for certification marks face the same examination process as standard trade mark applications and must meet absolute and relative ground requirements. However, they must also meet certain additional requirements, including that: 

• the trade mark owner is not permitted to use the mark itself – the owner must remain independent of the trade mark use; 
• the trade mark owner must provide rules or regulations that govern any use of the certification mark; and 
• the mark must be capable of distinguishing the goods and services certified by the applicant from goods or services not so certified. (This is a different test to the standard test for distinctiveness, which requires the trade mark to distinguish the applicant’s goods/services from those of other traders generally.)

The BASMATI certification application was examined and IPONZ issued objections on the grounds that:

• the mark lacked sufficient distinctiveness to achieve registration as a certification mark; and
• the certification rules provided by ADEPA were insufficient to meet the relevant statutory requirements.

APEDA filed arguments and evidence of use in support of its application through several rounds of response, but the objections were maintained. In particular, APEDA’s proposed regulation in its certification rules that only rice grown in the Indian Basmati Growing Area (BGA) region – ie, not rice from the Pakistan BGA region – would qualify as a certified product was at issue. Since APEDA was not able to overcome the objections through arguments and evidence, IPONZ issued a notice of intention to formally reject the application.

… But the real question is: would they?

The notice of intention to reject the application was based on the examiner’s assessment that the word BASMATI is purely descriptive for rice and therefore the evidentiary burden of establishing acquired distinctiveness was so high that it could not be met by the evidence that the applicant had submitted. The examiner also relied on the BGA extending beyond India into Pakistan and Nepal and that rice-growers outside of the BGA (such as in China) grow “basmati rice” to dismiss APEDA’s proposed rule to certify only basmati variety rice grown in India as inappropriate.

APEDA requested reconsideration of the notice of intention to reject the application in a hearing before the Assistant Commissioner of IPONZ.

The Assistant Commissioner considered the grounds specified in the notice of intention to reject in light of APEDA’s refreshed submissions and evidence, which included 6 statutory declarations or affidavits that explained:

• the history of the basmati rice variety and how it is regulated by the Indian Government;
• the distinctive qualities of rice grown within the BGA as opposed to basmati rice grown outside of the BGA;
• the amount of rice exported from India to New Zealand; and
• the results of a survey conducted in NZ that established that NZ consumers are well aware of basmati rice and that more than 52% of respondents connected the word BASMATI with India (as opposed to Pakistan or Nepal or any other country).

The Assistant Commissioner agreed with the examiner that the certification application should be refused registration for the reasons explained in the notice of intention to reject, saying that use of the certification mark BASMATI as proposed would not serve to distinguish Indian basmati rice from basmati rice grown by traders in the Pakistani region of the BGA or other basmati rice growers based outside of the BGA (such as in China, Sri Lanka, Thailand and Indonesia). Accordingly, the “proposed mark simply would not perform the function required under the s 5 definition [of a certification mark], namely, of distinguishing the goods sold under that mark from goods not so certified” (para 33).

The Assistant Commissioner also found that the evidence of use provided by ADEPA did not assist in overcoming the distinctiveness issue because ADEPA’s own evidence showed that basmati rice sold in New Zealand originated from a wide geographical spread and was not limited to rice grown in the Indian region of the BGA. ADEPA’s survey evidence also demonstrated that the meaning attributable to the word BASMATI in New Zealand is that rice is of the basmati variety, not that it has been grown in a particular area in India. For these reasons, the application was refused.

ADEPA’s appeal period closes on 25 July 2024 and it will be interesting to see if the decision is appealed.

ADEPA has had limited success in its attempts to protect the word BASMATI as a geographical indication or a trade mark in Oceania. IPONZ’s position reflects IP Australia’s decision in 2022, where ADEPA’s application to register the word BASMATI as a certification mark was refused for similar reasons. (In Australia, geographical indications for goods other than wines are protected as certification marks.) ADEPA has appealed IP Australia’s rejection of the BASMATI word mark application to the Federal Court of Australia, which will also be interesting to watch.