Geographical indications of source: Legal protection and pitfalls for startups

The recent decision of the Regional Court of Cologne on “Dubai Chocolate” shows once again how complex the topic of geographical indications of source can be. As an IT lawyer with a focus on start-ups and innovative companies, I find such cases particularly exciting. They illustrate the legal pitfalls that young companies can face when developing and marketing products.

I like to pick up on current court decisions like this in my blog posts. Why? Because they perfectly illustrate what start-ups need to pay attention to when choosing a name and marketing their products. The case of “Dubai Chocolate” is a prime example: Who would have thought that a simple product name could cause so much legal trouble?

This involves not only trademark law, but also competition law and, in the case of food, even special food law regulations. It is extremely important for start-ups to have these legal aspects on their radar at an early stage. After all, nothing is more annoying than when an ingenious product idea ultimately fails due to legal hurdles. By analyzing such cases, I want to help start-ups and founders to identify and avoid potential legal stumbling blocks in good time. Because in the end, it’s all about bringing innovative ideas to market successfully and with legal certainty – without falling into expensive legal traps.

The case of the “Dubai chocolate”

On January 6, 2025, the Cologne Regional Court issued a temporary injunction against Aldi Süd, prohibiting the discounter from selling its “Alyan Dubai Handmade Chocolate”. The chocolate is produced in Turkey and has no actual connection to Dubai. The court considered this to be potentially misleading for consumers. The confectionery importer Andreas Wilmers, who sells Fex-brand chocolate produced in Dubai in Germany, had filed a lawsuit. He successfully argued that the use of the name “Dubai” for a product that did not originate in Dubai was deceptive to consumers.

The court clarified that a product may only be labeled as “Dubai chocolate” or similar in Germany if it was actually produced in Dubai or has some other geographical reference to Dubai. In the court’s opinion, the statement on the back of the packaging that the chocolate was produced in Turkey was not sufficient to prevent the product from being misleading. In the event of a repeat offense, Aldi Süd faces a fine. The decision is not yet final and Aldi Süd has the opportunity to lodge an appeal. The Cologne Regional Court had already ruled similarly in two earlier cases, which underlines the consistency in case law on this topic.

This case illustrates the importance of correct geographical indications in the food sector and the possible legal consequences of violating these principles. It is important for companies, especially start-ups, to take particular care when naming and marketing products in order to minimize potential legal risks.

Legal basis and implications

The decision of the Regional Court of Cologne is based on the German Trademark Act, in particular Section 127, which deals with geographical indications of source. This case illustrates the complexity of the issue and the need for companies to take particular care when naming and marketing their products, which gives rise to the following key aspects for start-ups and innovative companies:

1. Careful examination of product names before market launch
2. Transparent communication when using geographical designations
3. Obtain legal advice at an early stage to avoid cost-intensive legal disputes
4. Registration of own trademarks for innovative products without misleading geographical reference

Differentiation between the term variety and designation of origin

A central aspect of the case is the differentiation between variety terms and designations of origin. While variety terms can generally be used freely, designations of origin are often subject to strict protection rules. In this case, some lawyers argued that the term “Dubai chocolate” referred to a specific type of production (chocolate bar with pistachio cream and angel hair) and not necessarily to a geographical link. However, the court did not follow this reasoning and emphasized the potential misleading effect on consumers.

It is therefore essential for start-ups to differentiate precisely when naming products:

• Is it a pure variety term that describes a specific recipe or production method?
• Or does the name imply a geographical origin that raises specific consumer expectations?

This distinction can be decisive in order to avoid legal disputes and at the same time fully exploit the market potential of the product.

Conclusion and recommendations for start-ups

The “Dubai Chocolate” case underlines the importance of careful legal scrutiny during product development and marketing. This results in the following recommendations for start-ups and innovative companies:

1. Early legal advice on product development and naming
2. Thorough market research on the legal classification of similar products or designations
3. Transparent communication regarding the origin and properties of the product
4. Investment in the development of an independent brand without potentially misleading geographical designations
5. Willingness to adapt the marketing strategy if legal concerns arise

As a lawyer specializing in IT and media law with many years of experience in advising start-ups and innovative companies, I offer comprehensive legal support in this complex area of law. My expertise includes not only the legally compliant design of product names and trademark strategies, but also the development of tailor-made solutions for the specific challenges faced by young companies in the digital age.early and sound legal advice can help you minimize potential risks and at the same time create a solid basis for the sustainable success of your product. Contact me for an in-depth analysis of your individual situation and the development of a legally compliant strategy for your company.

Author: Marian Härtel

Marian Härtel ist Rechtsanwalt und Fachanwalt für IT-Recht mit einer über 25-jährigen Erfahrung als Unternehmer und Berater in den Bereichen Games, E-Sport, Blockchain, SaaS und Künstliche Intelligenz. Seine Beratungsschwerpunkte umfassen neben dem IT-Recht insbesondere das Urheberrecht, Medienrecht sowie Wettbewerbsrecht. Er betreut schwerpunktmäßig Start-ups, Agenturen und Influencer, die er in strategischen Fragen, komplexen Vertragsangelegenheiten sowie bei Investitionsprojekten begleitet. Dabei zeichnet sich seine Beratung durch einen interdisziplinären Ansatz aus, der juristische Expertise und langjährige unternehmerische Erfahrung miteinander verbindet. Ziel seiner Tätigkeit ist stets, Mandanten praxisorientierte Lösungen anzubieten und rechtlich fundierte Unterstützung bei der Umsetzung innovativer Geschäftsmodelle zu gewährleisten.