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Focus: Food

16 July 2013

In this issue: we look at a new voluntary labelling system to give consumers greater information about the nutritional content of food; renewed calls for changes to the country of origin labelling regime; a push to loosen the standard of what can be sold as gluten free; renewed scrutiny of alcohol advertising; defining the difference between a food and a medicine; and the debate around the safety of GM foods.

A five star rating system? Australia's new voluntary food labelling standard

In brief: The Federal Government has signed off on a voluntary front-of-pack labelling system that is designed to give consumers 'at-a-glance' information on the nutritional content of packaged foods. Partner Andrew Wiseman, Senior Associate Susie Stone, and Lawyers Sarah Sharkey and Kirsty Corby report on the details of Australia's new, voluntary food labelling system.

How does it affect you?

  • The voluntary star-rating labelling system (the star-rating system) requires packaged foods to carry a rating of from 1/2 to 5 stars, with healthier food choices carrying more stars.
  • At present, food manufacturers are simply being encouraged to adopt the star-rating system for all pre-packaged foods, excluding dairy products, confectionary and soft drinks. Further consultation with key stakeholders is expected to occur over the next 12 months, to refine the requirements of the star-rating system. Products bearing star-ratings are unlikely to hit the shelves before mid-2014.
  • However, the star-rating system may not remain voluntary for long, with the Federal Government signalling an intention to impose a mandatory food labelling system (to be devised by Food Standards Australia and New Zealand (FSANZ)) unless the star-rating system is widely adopted by the industry over the course of the next two years.
Background

The introduction of a front-of-pack labelling system that provides at-a-glance nutritional information about junk food products was a key recommendation of Labelling Logic: Review of Food Labelling Law and Policy, a review into food labelling law and policy commissioned by the Federal Government in 2011 (the Blewett Review). The review was conducted by an independent panel chaired by former Australian Health Minister, Dr Neal Blewett AC.

The Blewett Review specifically recommended that Australia adopt a 'traffic light' front-of-pack labelling system, in which foods would be colour coded green, amber or red according to the levels of saturated fat, sugar and salt present in them. (Green labels would indicate low levels of such components; amber, medium levels; and red, high levels).1 Such a system was mooted and then swiftly dropped by the Federal Government at the end of 2011, following vehement opposition from the food manufacturing industry. For more background on the introduction of tougher junk food regulations in Australia, see our earlier Focus: Aggressive Regulation of Consumer Foods – Is "Junk Food" Next?

Consultation with stakeholders

Since December 2011, the Legislative and Governance Forum on Food Regulation (the Forum), a body comprising health ministers from all Australian states and territories and New Zealand, has sought to develop a front-of-pack food labelling system in consultation with stakeholders, including public health organisations and representatives of the food manufacturing industry.

The Food Regulation Standing Committee (the Standing Committee), a sub committee of the Forum comprising senior officials from government departments, including the Department of Health and Ageing, has coordinated the development of the system. The Standing Committee established a Steering Committee to manage the process and a Project Committee to develop the finer points of the system. Key stakeholders including the Australian Food and Grocery Council, Australian Beverages Council and the Australian Medical Association are represented on the Project Committee. The Project Committee has commissioned two working groups to report on technical design of the labels, and on implementation, evaluation and education. The reporting role of these two working groups is regular and ongoing.

The star-rating system

On 14 June 2013, the Forum agreed upon the star-rating system to be applied to all packaged, manufactured or processed foods presented ready for sale to consumers in the retail sector in Australia. The star-rating system has two components: a star-rating and specified nutrient information elements.

Under the new system, food products will have a star-rating from 1/2 a star to 5 stars (increasing by 1/2 star increments), where healthier food choices will, predictably, carry more stars. Food labels will also display a 'slider' above the relevant star or half star with a number corresponding to the star-rating of the product, as set out in the image below. The star-rating scale is based upon a modified Nutrient Profiling Scoring Criterion developed by FSANZ.

Labels will also indicate the quantities of saturated fat, sodium and sugars per 100g of the product, along with an energy icon specifying the number of kilojoules per 100g of the product. Labels may also display one optional positive nutrient information element, such as the amount of fibre or calcium present in 100g of the product.

Exceptions to the star-rating system

Confectionary, soft drinks and dairy products are notably excluded from the full scope of the star-rating system.

Confectionary and soft drinks will not be required to bear a star-rating or specified nutrient information elements, but instead will only be required to carry an energy icon specifying the number of kilojoules in each product.

Further, after expressions of concern from the dairy industry that the high levels of saturated fats contained in many dairy products, such as cheese and yoghurt, would result in a poor star-rating for such products, the Forum has agreed to consider a modified Nutrient Profiling Scoring Criterion to apply to all dairy products. The Forum is to decide on the application of the star-rating system to dairy products by December 2013.

Implementation and consumer education

Currently, compliance with the star-rating system is voluntary.

The system is to be finalised over the next 12 months in consultation with stakeholders and it is expected that products bearing labels with star-ratings will begin to appear on shelves in mid-2014. In line with the recommendations of the Blewett Review, the roll out of the system is to be accompanied by a comprehensive social marketing and consumer education campaign funded by the Federal Government.2

The system is to be implemented by two bodies; a Front-of-pack Labelling Overview and Advisory Committee, responsible for compliance monitoring, evaluation, social marketing and consumer education; and a Code Administration Committee, to administer a voluntary industry led code of practice. Both bodies are to be made up of government, industry and community representatives.

However, the system may not remain voluntary for long. In a joint press release, Minister for Health Tanya Plibersek and Parliamentary Secretary for Health and Ageing Shayne Neumann stated that the system would be voluntary 'subject to there being consistent and widespread uptake of front-of-pack labelling'. The Forum will conduct an evaluation of the star-rating system after two years and, if it determines that voluntary implementation has been unsuccessful, it will call upon Food Standards Australia and New Zealand to develop a compulsory front-of-pack labelling system.

A trans-Tasman solution?

Despite the trans-Tasman nature of the Forum, New Zealand has not made any firm commitment to adopt the star-rating system. New Zealand Food Safety Minister, Nikki Kaye, is expected to consult with public health officials in July, in order to develop a voluntary front-of-pack labelling system considered appropriate for New Zealand. However, given the extensive trade of food between Australia and New Zealand, it is likely that any New Zealand food labelling system will closely resemble Australia's system.

Reactions of stakeholders

Reactions to the new star-rating system are polarised.

Public health organisations, such as the Cancer Council, have applauded the announcement, stating that improved front-of-pack labelling will empower consumers to make healthier food choices.

In contrast, the Australian Food and Grocery Council (despite its representation at the Forum) has criticised the proposed system, saying that it imposes an additional regulatory burden on Australia's food processing industry and was released without the Federal Government undertaking any substantial cost-benefit analysis.

Overseas developments

Australia's introduction of food labelling requirements is in line with developments in the UK, US and Europe. For example, in June 2013, the UK Government revealed its voluntary traffic light labelling system for pre-packaged foods to be rolled out over the next 18 months. The new system, akin to the traffic light labelling system rejected in Australia, requires pre-packaged foods to be coded red, amber or green based on the quantities of fat, sugar, salt and calories in each product. All major UK supermarkets and many large food manufacturers, including Mars, Nestle and PepsiCo, have signed up to the voluntary scheme. Cadbury Schweppes and Coca-Cola are notable exceptions, both companies stating that they felt daily intake guides provide consumers with better nutritional information.

Conclusion

Although the star-rating system is currently voluntary, the Federal Government has expressed its intention to introduce a mandatory front-of-pack labelling system if the food industry fails to adopt and implement the current system effectively over the next two years. At this stage, the potential compliance costs for the food industry are not known.

The fate of the star-rating system if there is a change of government in the upcoming election is unclear, as the Opposition has, to this point, been silent on whether or not it supports the system. Opposition Leader Tony Abbott has previously described tougher junk food regulation, such as bans on junk food advertising, as overly paternalistic but this view is not shared by all members of the Coalition.3

It is certain, however, that as future governments continue to grapple with this country's rising obesity levels, mandatory food labelling laws (in some form) will remain on the agenda.

Update on country of origin labelling reforms

In brief: There have been renewed calls for reform of Australia's country of origin labelling framework so that it better meets the needs of consumers, primary producers and manufacturers. Partner Richard Hamer, Senior Associate Ric Morgan and Lawyer Claire Agius report.

How does it affect you?

  • The Greens have introduced the Competition and Consumer Amendment (Australian Country of Origin Food Labelling) Bill 2013 (the Greens' Amendment Bill) into the Senate. This Bill has been introduced in response to a Senate Committee review of the Competition and Consumer Amendment (Australian Food Labelling) Bill 2012 (No 2), which recommended that this Bill, as drafted, should not be passed.
  • While it is likely that the Greens' Amendment Bill will also not be enacted in its present form, the Senate Committee report suggests that there is general support for reforming the country of origin labelling framework with a view to addressing specifically the needs that arise in the context of food products sold in Australia.
General consensus for reform

Senator Christine Milne introduced the Greens' Amendment Bill into the Senate on 16 May 2013. The Greens' Amendment Bill is a further attempt at reform of the country of origin labelling framework after the Senate Rural and Regional Affairs and Transport Legislation Committee recommended that the Competition and Consumer Amendment (Australian Food Labelling) Bill 2012 (No 2) not be passed.

The Senate Committee reported that there was general support for reform of the country of origin labelling framework, but that any reform must balance the objective of avoiding consumer confusion against the benefits to the Australian manufacturing sector that stem from use of the claims 'Product of Australia' and 'Made in Australia'.

The Senate Committee also reported there were concerns that the threshold of 'substantially transform' is currently set too low, and recommended that the Federal Government consider developing a more effective definition of this key concept. Under current country of origin legislation, the claim 'Made in Australia' can be made if 50 per cent or more of the cost of producing or manufacturing the goods has been incurred in Australia and the food has been 'substantially transformed' in Australia. Substantial transformation in a country is currently defined as 'a fundamental change in that country in form, appearance or nature such that the goods existing after the change are new and different goods from those existing before the change'.4

Certain exclusions

The Greens' Amendment Bill attempts to introduce a list of processes that would not satisfy the requirement of 'substantial transformation'. This appears to be an attempt to take on board the suggestion raised in the Senate Committee's report. Proposed exclusions include freezing and canning; extracting juice from fruit or vegetables; seasoning, crumbing or battering food; and curing or salting food.5

While it is unlikely that the Greens' Amendment Bill will be enacted in its current form, the Senate Committee report suggests that there is an appetite for a more tailored approach to country of origin labelling of food products.

How free should gluten-free be?

In brief: There have been moves towards loosening the standards for 'gluten free' labelling in Australia to allow for gluten levels up to 20ppm. Opponents say any loosening of the standards would be likely to mislead consumers. Senior Associate Alison Beaumer reports.

How does it affect you?

  • Coeliac Australia has been working with the Australian Food and Grocery Council (AFGC) in lobbying Food Standards Australia New Zealand (FSANZ) to change the 'gluten free' standard to allow for gluten less than 20ppm. The next step is for the AFGC to submit an application to FSANZ, which will undergo a full review. If accepted, it will be published for public comment and input.
  • While changing the standard would broaden the range of products that could be labelled 'gluten free', there would need to be a careful education campaign to ensure that relevant consumers are not misled by the change.
The current position

The current standard for 'gluten free' claims in Australia is contained in Standard 1.2.7 of the Australia New Zealand Food Standards Code. It provides that there must be 'no detectable' gluten in the product.

Arguments for change

Coeliac Australia, the organisation representing people with coeliac disease in Australia, argues that:

  • The internationally accepted definition of 'gluten free' is less than 20ppm gluten. This standard applies in the UK, Europe and Canada and is soon to be adopted in the US. Evidence based medical research has found this to be a safe level for people with coeliac disease. Coeliac Australia already endorses with its logo certain products having less than 20ppm gluten which cannot be labelled 'gluten free' in Australia.
  • The 'no detectable' standard is problematic because testing methods have improved dramatically and gluten can now be detected at 3ppm. At the time the current standard came into effect, the limit of detection was 30ppm.
  • Changing the standard would result in more choice and affordability. At present, imported 'gluten free' products cannot necessarily be sold as such in Australia. Further, the strict standard burdens Australian food manufacturers with extra costs for raw materials, machinery, testing and the threat of unnecessary product recalls. These high costs are usually passed on to consumers.
Arguments against change

Opponents argue that any change to the 'gluten free' standard would undermine truthfulness in food labelling. Australian consumers understand 'free' to mean exactly that – free from any trace or detectable amount. Applying the 'gluten free' label to a product containing even trace elements of gluten would mislead consumers and create an inconsistency with other 'free' labelling in Australia, such as 'lactose free'. It would arguably remove Australia's competitive advantage in the export market, where Australian gluten free foods are regarded as the safest in the world.

A way forward?

Because of the way in which Australian consumers currently understand 'free' labelling, there is a real risk that consumers could be misled as a result of any loosening of the 'gluten free' standard. On the other hand, consumers of gluten free foods are a relatively well-educated audience when it comes to ingredients and product labelling. With the support of Coeliac Australia, and a careful education campaign about the change, it is foreseeable that relevant consumers could be educated to understand the new standard in a way that would avoid confusion or deception.

Alcohol advertising under scrutiny

In brief: Australia's quasi-regulatory system for alcohol advertising is coming under increasing scrutiny, with calls for tighter regulation and even bans. Senior Associate Alison Beaumer reports.

How does it affect you?

  • Proponents of tighter regulation for alcohol advertising have been vocal in the past year, especially regarding the indirect marketing of alcohol to young people.
  • The alcohol industry will need to continue to engage with community concerns on a range of issues if the current model of quasi-regulation is to be preserved.
Alcohol advertising in Australia

The Alcohol Beverages Advertising (and Packaging) Code (ABAC) governs alcohol advertising in Australia. ABAC is a quasi-regulatory scheme in that its guidelines are negotiated with government and there is government representation on the management committee. The scheme provides a pre-vetting service for advertisers and consumer complaints are handled independently, with all costs borne by the industry. There are no penalties for non-compliance but there may be commercial consequences. Alcohol advertising in Australia must also comply with the general law and other advertising codes of practice.

Recent developments
  • Aug 2012: The Rev Fred Nile introduced a Private Member's Bill into the NSW Parliament which would have the effect of prohibiting alcohol advertising in NSW. Debate on the Bill has been postponed until August 2013.
  • Sep 2012: The Australian Medical Association conducted a National Summit on Alcohol Marketing to Young People, in association with the National Alliance for Action on Alcohol. It called on the Federal Government to launch an inquiry into the marketing of alcohol, particularly to teenagers and young people, and to develop more stringent and enforceable regulations.
  • Dec 2012: The Australian National Preventive Health Agency (ANPHA) released an issues paper, Alcohol Advertising: the effectiveness of current regulatory codes in addressing community concerns, with a primary focus on the impact of alcohol marketing on children and young people. Public submissions were open until March 2013.
  • Mar 2013: Former NSW Health Minister, John Della Bosca, called for a ban on alcohol advertising to be seriously canvassed, in a speech to the NSW Alcohol Summit.
  • Apr 2013: VicHealth called for an end to the 'loophole' which allows daytime alcohol advertising during sporting events and, eventually, a total ban on alcohol advertising at sporting events. State police commissioners debated such a ban at a national meeting.
  • May 2013: WA Police Commissioner Karl O'Callaghan urged Opposition Leader Tony Abbott to consider banning alcohol advertising during live sporting broadcasts.
Where to from here?

In response to the ANPHA issues paper, alcohol industry associations have argued that the existing system is strict and comprehensive; only a small percentage of alcohol advertisements are complained about; banning alcohol advertising is an ineffective tool to reduce alcohol misuse; and alcohol advertising does not create a causal link to alcohol consumption in children.

While the issue has recently been overshadowed by the controversy over live betting odds during sports broadcasts, it is likely that the debate will be ongoing. If the alcohol industry wishes to preserve the current quasi-regulatory model, it will need to continue to engage with its critics, particularly regarding the 'hot' topics of daytime sports advertising, so-called 'new media' advertising, and product placement in films and music videos, and their potential impact on children and young people.

A food or a medicine?

In brief: Souvenaid, a product released for sale in Australia in May 2013, has been variously described as a 'medical food', a 'nutritional supplement' and a 'Food for Special Medical Purposes', with its manufacturer claiming that the product can improve the memory in individuals in the early stages of Alzheimer's disease. However, Souvenaid does not have Therapeutic Goods Agency approval, and complaints have been made alleging breaches of the Therapeutic Goods Act 1989 (Cth) and the Therapeutic Goods Advertising Code 2007 (Cth). Partner Richard Hamer and Lawyer Michelle Freeman report on the controversy.

How does it affect you?

  • As regulation around therapeutic claims increases, manufacturers of products claiming therapeutic or health effects may be choosing to present their wares as foods, rather than as complementary or other types of medicines.
  • In this instance, the Therapeutic Goods Agency's (the TGA) referral of the complaints to the NSW Food Authority may suggest that the TGA accepts that the product is subject to regulation under the Food Standards Code rather than the Therapeutic Goods Act 1989 (Cth) and the Therapeutic Goods Advertising Code 2007 (Cth) (the Advertising Code).
  • From January 2013, a broader range of health claims in relation to foods are now permissible and the line between a health claims and therapeutic claims may be less clear.
  • The form taken by ingestible products claiming therapeutic effects can therefore be seen to be important to manufacturers when electing how to present a product that is required to comply with the least onerous regulatory regime.
The product and its claims

Souvenaid's manufacturer, Nutricia Advanced Medical Nutrition, states that the product's ingredients include a patented combination of nutrients (known as 'Fortasyn Connect') that have been clinically proven to support brain synapse formation and consequently memory function in individuals in the early stages of Alzheimer's disease. Souvenaid is sold as a pre-packaged, single-serve drink, and is recommended to be used only under the supervision of a healthcare professional. However, no prescription is required to purchase Souvenaid in Australia, and it is available from pharmacies and online. The product has been discussed broadly in the media, was featured by nationally broadcast current affairs program, and is supported by an extensive manufacturer's website containing sections for both healthcare professionals and members of the general public. The manufacturer's website states that the product is a Food for Special Medical Purposes, a category of food that is regulated by Standard 2.9.5 of the Food Standards Code.

The complaints

Ken Harvey, an adjunct associate professor of health at La Trobe University in Victoria, lodged complaints with the TGA regarding alleged breaches of the Therapeutic Goods Act and the Advertising Code. Associate Professor Harvey has stated that, in his view, Souvenaid's listed ingredients, recommended dosage and claims cause it to meet the definition of a therapeutic good, and that if the product were classified as a therapeutic good it would need to be listed by the TGA on the Australian Register of Therapeutic Goods. He further considers that in such a scenario, the product would be required to comply with the Advertising Code which prevents promotion of products for serious disease without advertising approval granted by the TGA.

Progress of the complaints

Reports state that the TGA has referred the complaints to the New South Wales Food Authority, which in turn confirmed that it is investigating to determine compliance with the Food Standards Code. This referral suggests that the TGA does not consider that Souvenaid is a product that falls within its area of regulation, and instead is, as stated by the manufacturer, a product that should be regulated under the Food Standards Code. However, until the NSW Food Authority completes its investigation and releases its findings it is uncertain whether the product will be found to be in breach of the Food Standards Code or whether the claims made about the product are properly understood as being permissible health claims. Watch this space.

No need for increased food safety assessment for GM foods – FSANZ

In brief: In response to concerns raised by a recent scientific article that contemplates the generation of double-stranded ribonucleic molecules and their potential to affect human health via changes in the expression of human genes through gene silencing, Food Standards Australia New Zealand believes there is no scientific evidence to the claim that would require any changes to the safety assessment procedures in place to examine genetically modified foods. Partner Richard Hamer and Lawyer Michelle Freeman report.

How does it affect you?

  • Food Standards Australia New Zealand (FSANZ) considers that the available evidence 'does not support the view that small double-stranded ribonucleic molecules (dsRNAs) in foods are likely to have adverse consequences for humans';
  • FSANZ believes that its current process of safety assessment adequately protects public health; and
  • FSANZ will continue to make genetically modified (GM) food safety assessments on a case-by-case basis.
Environment International article

In March 2013, the scientific journal Environment International published a paper raising concerns about the regulation of GM crops containing dsRNA in three jurisdictions (Australia, New Zealand and Brazil) and further made a number of proposals regarding safety assessment procedures. Concerns raised relate to a perceived shift in scientific practice towards RNA modification (and away from DNA modification) to regulate gene expression through gene silencing in the production of GM foods. The authors consider that the evidence shows dsRNA to be both stable and transmissible, thereby requiring that human exposure be regulated via risk assessments focused on the presence and action of dsRNA. The paper's authors called for a suite of new experimental evaluations to be undertaken by authorities before market-release approval of GM foods containing artificially synthesised dsRNA. These suggested evaluations include bioinformatic analyses, identification of intentionally and unintentionally synthesised dsRNA, tissue culture testing for responses to dsRNAs, and long-term animal (and possibly human) testing.

The FSANZ response

FSANZ produced a response to the Environment International article in just two months (May 2013). After undertaking a review of both the article and current scientific literature, the authority considers that its current approach to GM food safety assessment is sufficient to safeguard public health, and it states that it considers that the 'current safety data requirements ... are sufficiently broad and flexible to accommodate the provision of additional data and information on a case by case basis.' FSANZ concluded that dsRNA will be 'naturally abundant in foods from conventional plants, animals and microorganisms such as yeasts', and the authority suggests that this presence establishes a 'history of safe consumption by humans.' While FSANZ is open to 'new developments which may be relevant to the safety of GM food,' at the current time no changes to the system of assessment will be considered. Other academics and scientists have supported FSANZ's position in its response.

Summary

Extensive testing of the type suggested by the authors of the Environment International article would have cost and time implications for manufacturers wishing to bring a GM food product containing dsRNAs to market. At this time, FSANZ does not consider that any amendment needs to be made to its biosafety assessment procedures.

Footnotes
  1. Labelling Logic: Review of Food Labelling Law and Policy, 2011, pp 13-14, recommendations 50-54.
  2. The Blewett Review recommended that any intervention by the Federal Government into food labelling would need to be accompanied by a comprehensive and multifaceted consumer education campaign to explain and support a successful food labelling system (recommendation 52).
  3. Dr Rhonda Jolly, 'Marketing obesity? Junk food, advertising and kids', Parliamentary Library Research Paper No 9, 2010-11, 12 January 2011.
  4. Section 255(3) of Schedule 2 of the Competition and Consumer Act 2010 (Cth).
  5. Proposed s137A(6).

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