The decision by the European Commission to give the go-ahead to take action comes as the trade bloc continues negotiations over a bilateral food and drink deal.
It stems from a joint move by eight European member nations to file a lawsuit against China to complain about 25 protected trademarks they claim are being maliciously used in food marketing there.
The suit seeks to annul Chinese-registered trademarks for items such as “Greek feta”, “Spanish olive oil” and “Italian balsamic vinegar”.
None of these, or others from countries including France, Portugal, Germany, Hungary and Romania, have been manufactured in their designated nations.
Interestingly, the trade deal currently being negotiated by the EU and China will cover some 200 mutually recognised geographical indications in a bid to protect producers from unfair competition and drum up demand for authentic products.
A draft list of products has been agreed by both countries, and includes all of those mentioned in the lawsuit.
Without these safeguards, "Chinese owners will have the right either to produce [products] domestically or to import homonymous counterfeit products from the whole of the world," according to Greek trade officials.
The EC said it has no qualms about allowing the action, which will not harm trade talks.
"The Commission is confident that the future agreement will bring significant benefits to European GI producers. Even where there are existing trademarks, European GIs can still be protected in China because China, like the EU, allows coexistence between an earlier trademark and a later GI," Euractiv.com reported an official as saying.
The GIs chosen by the EC took into account market volume in China and the potential risk of counterfeiting.
Other protected items cited in the lawsuit include French champagne and cognac.
The EC describes geographical indications as one of the great successes of European agriculture, with more than 3,300 EU names registered and 1,250 non-EU names protected within the bloc.
EU GIs are worth €54.3bn (US$64.8bn) and account for 15% of total EU food and drinks exports.
More from China…
Cofco agrees to major distribution deal with US partner
Cofco, the Chinese state-owned grain major, will form a partnership with American co-operative Growmark in a bid to improve control of its import chain.
The distribution deal is the latest move in Cofco’s strategy to get more access to the food it imports.
It has already recently invested US$3bn in the purchase of Noble Group’s agribusiness and acquired a substantial stake in Dutch grain trader Nidera.
The latest deal will give China the ability to receive some 180,000 grain bushels each hour by truck and rail.
River barge deliveries will increase this volume by about 60,000 bushels per hour.
Both companies will unite to source the grain from Cofco’s office in St Louis, the companies said in a statement.
The deal draws a more direct link between a large Chinese food importer and farmers in the world's largest corn exporter and second-biggest soybean exporter.
China’s huge market — the world’s biggest for soybeans — is proving attractive to Growmark.
Brent Ericson, its senior vice-president for member services, said: "It gives us more of a direct pipeline to those end-users.
“Economics dictate where grain moves, but all things being equal this gives us a leg up in the Chinese market," Ericson said.
Cofco has been exploring potential North American link-ups through partnerships or acquisitions over the last year.