WTO intervenes in Havana rum clash

The ownership of the Havana Rum brand is disputed

The World Trade Organization has, indirectly, intervened in a punch-up between Cuban and other makers of rum.

Bacardi made in Cuba in the1860s as a by-product of the sugar industry which is still one of the main industries on the island

The conflict, between Bermuda-based Bacardi and an international distributor of rums from Cuban distilleries, has lasted for years.

Both Bacardi and the French drinks maker Pernod Ricard insist that they have the rights to the Havana Club trademark.

And, bizarrely, they may both be right, depending on which jurisdiction makes the ruling.

New and old owners

Pernod distributes the Cuban version of Havana Rum, through a joint venture with a Cuban state enterprise and in agreement with Fidel Castro whose government had seized privately owned distillers in Cuba after it came to power in 1959.

But Bacardi, which claims it bought the rights to the brand name from the original Cuban owner, Jose Arechabala, in 1997, registered the name in the United States.

There a law was introduced in 1998, banning US courts from enforcing Cuban product brand names owned by companies taken away by their original owners by the Castro government.

The decision angered Fidel Castro who ordered companies seized by his government to produce Bacardi-brand rums for sale abroad, in revenge for its plans to market its own Havana Club rum in the US.

Pernod Ricard was also angered by the US law which essentially made it impossible for the French drinks giant to enforce the trade mark in the US.

US trade embargo

Pernod Ricard appealed to the WTO.

In an initial ruling in August, the world trade body said the US law was illegal and ordered the country to change it.

Then, in a surprise twist to the tale, the European Union, appealed the WTO ruling because it objected to separate parts of it.

The appeal has resulted in the original ruling being overturned, though it has not dealt directly with the ownership of the Havana Club trademark.

Nevertheless, the ruling, which is final, is considered a victory for Bacardi, even though the US must still amend its law to remove discrimination against Cuban nationals' rights to defend their trademark rights in the US.

Pernod Ricard cannot currently sell Havana Club in the US due to its trade embargo against Cuba, but the company is keen to cling onto the trademark in case this restriction is removed in the future.