A Champagne update: Much Ado about Nothing29 July 2021
On July 2, 2021, President Putin signed a law 345-Ф3 “On Making Amendments to the Federal Law On State Regulation of Production and Circulation of Ethyl Alcohol, Alcoholic Products and on Curbing Consumption (Drinking) of Alcoholic Products”. This law changes the wording of many articles of the basic law No 171-Ф3 of November 1995, deletes several articles and words. In particular, it deletes the word “champagne” (shampanskoye) from many articles which stood by the side of the term “sparkling wine”.
The next day, the Russian media exploded with shocking news: “Putin signed a law according to which Champagne may be Russian only”, “Amendments signed by Putin may prohibit French Champagne”, “Putin banned Champagne to French people”, etc, etc.
One of the articles explains that President Putin signed an ordinance forbidding import to Russia of sparkling wines from Champagne region under the name of Champagne. Now, they will have to be labeled as simply “sparkling wine”. The Ordinance reserves the name “Champagne” exclusively for the wines produced in Russia.
None of the articles announcing the new rules gives citation form the law. In fact, Russia adopts silly aws sometimes but this time it seemed that the new law surpassed all limits of common sense. This caused us to delve deep into the law No 171-Ф3 and find the provisions that stirred the media. The law is long, more than one hundred pages. It gives definitions of the terms and provides conditions for producing alcoholic beverages in Russia and sets certain limitations on the Russian producers.
The word champagne can be found in the law only once in Article 2: Alcoholic products are divided in such types as spirit based drinks (including vodka, cognac, grape vodka, brandy), wine, fortified wine, sparkling wine including Russian Champagne,…. Earlier, the word champagne was present in the law in many instances by the side of the words “sparkling wine”. The amendments deleted the word champagne in many cases because the word champagne is not synonymous to sparkling wine and not all sparkling wines are Champagne.
Article 11 of the Law No 171-Ф3 provides that alcoholic products sold in retail outlets on the Russian territory shall contain information in the Russian language which should include information on:
- the name of the alcoholic product;
- the price of the alcoholic product;
- the name of the producer (legal address);
- the country of origin of the alcoholic product; … and other mostly technical pieces of information.
The name of the alcoholic product is sparkling wine and that is what should be shown on the bottle, preferably on the back label. There is no prohibition for French exporters to name its product as Champagne.
The question is that Article 2 of the law features the word combination “Russian Champagne”, the only mention of the word in the law and this may be an issue for discussions or disputes.
Otherwise, there are no limitations for importers of French Champagne. Given that false information of unclear origin spread like a wildfire the Ministry of Agriculture came out with clarification of the law on July 7, 2021. It explained that the new version of the law on circulation of alcoholic products does not prohibit the use of the word Champagne.
Notwithstanding, the respectable magazine “The Trademark Lawyer” carried an article in its issue of July 22, 2021 entitled “New Russian law on Champagne’s label might trigger a WTO complaint. The article was authored by Enrico Bonadio from London and Magali Contardi from Alicante. They wrote that the law prevented French champagne producers to name their wine as Champagne. This is in striking variance with facts, especially when the competent Russian body, the Ministry of Agriculture disavowed false information.
We are ready to continue discussion of this problem if questions remain.