On 24 September 2014 our firm organizes a seminar addressing the developments in Functional and Medical Foods. Where? Next door to our office in Pakhuis de Zwijger.
The Institute of Medicine has designated functional food as “any food or food ingredient that provides a health benefit beyond its nutritional benefit”. Functional foods comprise food supplements, probiotics and other foods having a beneficial effect on human health, which is often advertised by health or nutrition claims as using those claims in connection with this type of foods is very attractive from a marketing point of view.
Functional foods are just one step away from medical foods, catering for particular nutritional needs that regular foods do not supply. Contrary to functional foods, medical foods are highly regulated. Furthermore, both types of food are subject to specific legislation regarding health and nutrition claims as well as regarding food information to be provided to consumers.
The regulatory requirements for health and nutrition claims offer a chance and a challenge. Also, as of 13 December 2014, all food business operators have to comply with very strict, new information requirements on the basis of the Regulation on Food Information to Consumers. To what extent does this regulation help the final consumer to make healthy choices and how does this impact the entrepeneur? Our seminar will address these issues and provides practical guidance on solutions. Speakers are: Bernd Mussler (Innovation Project Manager at DSM), Ruud Albers (CEO at Nutrileads) and us (Karin Verzijden and Sofie van der Meulen).
A few spots left!
We still have a few spots left! Attendance is free and you are welcome to bring along your colleagues. More info? Check the invitation on our website. For registration, please send an e-mail to firstname.lastname@example.org with your name, the names of colleagues you would like to register and contact information. Questions? Contact our office manager Marjon Kuijs at email@example.com or +31 (0) 88 650 6500.
Looking forward to see you there!
Missed our seminar? Download our slides!
Recently, the Rotterdam District Court decided a dispute between Omega Pharma and Procter & Gamble on allegedly misleading advertising of food supplements. The product in dispute was Vibovit, a multi vitamins product for mothers and young children marketed by Procter & Gamble (P&G) since January 2014. Although well-known for its consumer products such as detergents and toothbrushes, Procter & Gamble is a new player in the field of food supplements. Omega Pharma is a company focusing on OTC health and care products including food supplements, for instance Davitamon. It holds a market share of 61 % in volume and 65 % in value in this field. Omega Pharma clearly perceives Vibovit as a competing product for Davitamon. No doubt, clear scrutiny of the new competitor in the field of food supplements was the start of this case.
Claims made by Omega Pharma
In a nutshell, Omega Pharma accuses P&G of committing misleading advertising and unfair commercial practises regarding its Vibofit product and also of violation of legislation on health claim, food supplements and labeling. More concretely, Omega Pharma inter alia opposed (1) the claim that Vibofit did not contain any preserving agents, whereas it appeared from the list of ingredients that the product contained potassium sorbate. (2) Furthermore, Omega Pharma complained that the packaging of Vibofit stated it contained only natural colouring agents, as it did not agree that the colouring agents titanium dioxide and carbon dioxide qualified as such. (3) Also, Omega Pharma considered the claim “+Omega 3” mentioned on the Vibofit packaging was made in violation of the Claims Regulation.
P&G’s preliminary defence
As a first preliminary defence, P&G had argued that Octapharma’s claim could not be received by the Civil Court, as Octapharma should have brought this claim before the Dutch self-regulatory body that advises on advertisements for health products (KOAG-KAG). This defence was rejected, as this self-regulatory body is only competent to hear disputes on health claims and not regarding any other claims in the field of food or advertising law. As a second preliminary defence, P&G had advanced that Omega Pharma’s claim actually related to unfair B2C commercial practices and that Omega Pharma could not invoke these rules (meaning their national implementation) against its competitor. This defence was also dismissed, as the Court considered that Omega Pharma was entiteld to invoke the rules on unfair commercial practises, being a lex specialis on the general law of the torts, against P&G.
(1) Evaluation of claim re. preserving agent potassium sorbate
Although the parties agree that potassium sorbate can be used as preserving agent, P&G argues this is not the case at hand. Instead, it uses this compound as a processing agent for the preparation of the yellow colour of the Vibofit gummies. As a result of the carry-over principle, a mimimum quantity of potassium sorbate is present in the final product. However, since this quantity is only 0,00005 %, which is 2.000 times too weak to be able to function as s preserving agent, the Court accepts this defence. As a consequence, the claim “free of preserving agents” is not considered misleading.
(2) Evaluation of claim re. colouring agents titanium dioxide and carbon dioxide
Omega pharma opposes the claims “100 % natural colouring agents” and “no artificial colouring agents”, as it considers that both titanium dioxide and carbon dioxide qualify as synthetic instead of natural colouring agents. Since the Food Additives Regulation does not make a distinction between natural and synthetic colouring agents, P&G relies on evidence from two national authorities to refute Omega Pharma’s claim. The first piece of evidence is a list of additives issued by the Dutch Food Safety Authority (Nederlandse Voedsel en Waren Autoriteit – NVWA) based on their qualification by the Dutch Nutrition Center (Voedingscentrum). This authority qualifies titanium dioxide (E171) and carbon dioxide (E172) as “natural”, as opposed to “synthetic” and “of natural origin, chemically processed”. The second piece of evidence is an NVWA fact sheet from which is follows that the colouring agents E171 and E172 are not considered synthetic. A consumer survey initiated by Omega Pharma investigating the misleading character of the claims used by P&G was considered not relevant, inter alia because it did not outweigh the opinion of the two Dutch national authorities and it was not considered completely neutral. As a consequence, P&G’s claims were not considered misleading.
(3) Evaluation of health claim +Omega 3
The notion + Omega 3 relates to the nutrition claim “source of Omega-3 fatty acids”. According the Health Claim Regulation, this claim is only allowed where the minimum quantities of 0,3 g ALA or 0,40 mg of the sum of EPA and DHA are met. One Vibofit gummy contains 2,5 mg Omega 3. As the packaging does not differ amongst ALA, EPA or DHA, it is not clear if the applicable standards are met. P&G however argues that it received prior approval from the self-regulatory body KOAG/KAG regarding its Omega 3-claims. Such approval has such authority that in those cases the Dutch Food Safety Authority usually does not apply any fines. In this particular case however, KOAG/KAG changed its policy after said prior approval was granted. According to the new policy, ingredients claims will only be allowed in as far as no existing health or nutrition claim is in place. Although P&G was not happy with this change, it nevertheless removed the Omega 3 claims from the Vibovit packaging and showed the galley proofs during the hearing. As a consequence, the Court considered that Omega Pharma no longer has sufficient interest re. its claim directed at Omega 3.
From the correspondence exchanged between the parties and reproduced in the judgement, it appears that P&G did not simply dismiss Omega Pharma’s claim but had meticulously prepared this case. Where it estimated that its claims would not hold, it had decided to move and to do so quickly. This is of course a very strategic approach, which quite often is successful to avoid litigation. However Omega Pharma simply decided to go after its new competitor. What is most striking in this case from an EU perspective, is the role of national authorities and national customs formulated by self-regulatory bodies. The prior approval from KOAG/KAG with respect to an ingredients claim for the food supplement Vibovit carried an enormous weight in the present dispute. Also, interpretations of national authorities of European food additives standards proved to be a decisive factor in this case. Therefore, when preparing a case of misleading advertising involving labelling and health and nutrition claims, carefully consider where to initiate it in view of those local customs.
After a succesful Autumn College last year September, this 2 days event on EU Food Law is repeated under the name Spring College. The event will take place on 27 and 28 March in Brussels and offers a unique opportunity to receive a profound insight and practical understanding of the complex legal and regulatory framework on EU Food Law. By means of a interactive and informal approach, this intensive two days training provides crucial knowledge on the legal and regulatory requirements, technical standards and relevant case law regarding two specific food law subjects.
Focusing on Health and Nutrition Claims and Food Information as the subjects which are nowadays at the core of the food industry, the Spring College provides fundamental theoretical and practical knowledge thanks to a number of highly topical presentations and ample opportunity for Q&A. Following the “learning by doing” approach, each day will be concluded by a case study, where the participants will split up in small groups to actively discuss and present their solutions. This will allow for a practical understanding and the application of the issues discussed.
The lecturers are seasoned food professionals stemming from the industry, private practise and consultancy. For the case studies, “tag teams” of two lecturers, providing insights from both the private practise and industry perspective, will be operative. All lecturers will stay for an entire day, so that they will also be available for taking questions outside the slots assigned to them.
Looking forward to see you there!
As announced in the post of October 30, 2013, the European Commission was expected to table a report concerning mandatory country of origin labelling (COOL) for meat used as an ingredient. In December 2013 this report was published. The report weighs the need for the consumers to be informed, the feasibility of introducing mandatory COOL and provides a cost/benefit analysis including the impact on the single market and international trade. On the basis of the debate following this report, the Commission will consider what, if any, appropriate next step should be taken. Tabling a legislative proposal concerning COOL for processed meats is a possible outcome. What was in the report?
Brief description of EU supply chain of processed meats and traceability
The EU meat processing industry represents more than 13.000 companies (Food Business Operators, FBOs) being mainly SME’s (90%). Products range from relatively simple meat preparations, e.g. fresh meat with spices, to sophisticated multi-ingredient foods. SME’s tend to change their suppliers more times a year to guarantee an adequate level of raw material at an affordable price. When the FBO process meat into (multi-ingredient) foods, these are then further sold to retailers/catering/butchers. Because of the variety of suppliers the FBOs of (multi-ingredient) foods use and the relatively small quantities they order, the FBOs do not have enough bargaining power to impose origin requirements to their suppliers. The supply chain of processed meats is quite complex and lengthy. The more complex the cutting and processing stages and the more advanced level of processing, the more complex traceability becomes. The existing EU traceability systems are not adequate to pass on origin information because the legislation is primarily based on the need to ensure food safety. Information to consumers is becoming more important, but food safety is still the core of EU food law. (see Article 18 of Regulation 178/2002 and Commission Implementing Regulation 931/2011 on the traceability requirements for food of animal origin). Because of the structure of the supply chain, the absence of a significant B2B interest in origin information and the inadequacy of the current traceability systems, the implementation of transmission of origin information to the consumer will be challenging.
Consumer interest in COOL
Despite challenging implementation, no less than 90% of consumers demand COOL for processed meat, but price and quality of meat are considered more important factors affecting consumer choice. Consumers would specifically like to know the country where meat was produced. The high percentage of consumers that want COOL could partly be caused by the horsemeat scandal, given the fact that the survey for the report took place in the midst of this scandal. According to the report, the consumer wants to be informed about the origin of meat, but does not want to pay for the additional costs that would be incurred in providing that information.
The report is accompanied by a Commission Staff Working Document, which underpins the report. Further, an external study commissioned by DG SANCO by the Food Chain Evaluation Consortium (FCEC) has been undertaken. Results van be found here and here. The report describes three different scenarios:
- Maintain origin labelling on a voluntary basis (status quo);
- Introduction of mandatory labelling on the basis of a) EU/non-EU indication, b) EU/specific third country indication;
- Introduction of mandatory labelling indicating the specific EU Member State or specific third country.
For scenarios 2 and 3, different modalities of processed meats have been studied for the three main categories of the products concerned in an increasing order of processing. Scenario 2 is less informative than scenario 3, as scenario 3 provides more specific origin information. Please see below for a table concerning scenarios 2 and 3.
The scenarios examined
Scenario 1 would not raise any additional operational challenges but it would not provide a fully satisfactory solution to the consumer demand for origin information. In this respect scenario 2 and 3 would both be more desirable. However, scenario 2 would result in an increase in operating costs for FBOs up to 25% and may result in market segmentation and changes in international trade flows. It would also increase the burden on public authorities with 10-30%. Under scenario 3 the increased burden on public authorities is expected to be even higher along with an increase of 8-12% of the total production costs.
Table: Advantages and disadvantages of origin modalities under scenarios 2 and 3.
|Modalities under 2nd and 3rd scenario||Advantages||Disadvantages|
|Category I: Meat preparations/mechanically separated meat||Country where ingredient was wholly obtained or country of last substantial transformation (Customs Code)||– Provides meaningful information to the consumer;- Trimmings and fat could be used as ingredients, where origin is determined as the country of the last substantial transformation.||– Additional traceability systems;- Implementation could be challenging if multiple origins are involved;- Trimmings and fat are not likely to be used as ingredients in cases, where origin is determined as the place of minimum rearing prior to slaughter, given the challenges in storage/traceability.|
|Place of minimum rearing prior to slaughter + place of slaughter||– Places more emphasis on the provenance of the raw material where the ingredient was not wholly obtained in one country.||– Additional traceability systems;- Implementation could be challenging if multiple origins are involved;- Trimmings and fat are not likely to be used as ingredients, given the challenges in storage/traceability.|
|Category II: Meat products||Country where ingredient was wholly obtained or country of last substantial transformation (Customs Code)||– Places more emphasis on the place of processing where the country of last substantial transformation applies;- Technically feasible for FBOs;- More practical, if multiple origins are involved;- Trimmings and fat could be used as ingredients.||– Provides no information on the provenance of the raw material where the country of last substantial transformation applies.|
|Place of minimum rearing prior to slaughter + place of slaughter||– Places more emphasis on the provenance of the raw material where the ingredient was not wholly obtained in one country.||– Provides no information on the place of processing;- Additional traceability systems;- Particularly challenging where multiple origins are involved;- Trimmings and fat are not likely to be used as ingredients, given the challenges in storage/traceability.|
|Category III: Multi-ingredient foods with meat used as an ingredient||Country where ingredient was wholly obtained or country of last substantial transformation (Customs Code)||– Places more emphasis on the place of processing where the country of last substantial transformation applies;- Trimmings and fat could be used as ingredients.||– Provides no information on the provenance of the raw material where the country of last substantial transformation applies;- Additional traceability systems;- Particularly challenging where multiple origins are involved.|
|Place of minimum rearing prior to slaughter + place of slaughter||– Places more emphasis on the provenance of the raw material where the ingredient was not wholly obtained in one country.||– Provides no information on the place of processing;- Additional traceability systems;- Particularly challenging where multiple origins would be involved;- Trimmings and fat are not likely to be used as ingredients, given the challenges in storage/traceability.|
Final thoughts and more upcoming changes
The overall conclusion of the report is that consumer interest in COOL is strong, but this is not reflected in the willingness pay for the extra costs for FBOs and an additional administrative burden. Further, as set out in my previous post on this subject, COOL would not prevent fraud like the horsemeat scandal from happening again at all. While being informed about the origin of the meat, the consumer still risks receiving misleading information concerning the ingredient(s) itself. However, the horsemeat scandal did show that the current traceability systems are not adequate in case of incidents. In the aftermath of the horsemeat scandal, the debate concerning COOL might therefore give rise to changes to the traceability systems. More specifically, the discussion between the Commission, the Council and the Parliament concerning COOL may result in legislative changes that have an impact on your business. Aside the report discussed in this post, the Commission is also expected to adopt implementing rules on mandatory COOL for unprocessed meat of sheep, goat, pig and poultry, based on the New Labelling Regulation. Get informed and subscribe to updates from FoodHealthLegal (see section above ‘Tweets” on the right side of your screen) in order to stay posted!
Italy vs. Croatia
What’s in a name? With Croatia’s accession to the European Union as of 1 July 2013 the beloved Croatian wine called Prošek is not allowed to be marketed under the name ‘Prošek’ anymore. How come? The Italian wines marketed under the name ‘Prosecco’ enjoy the rights granted by the protection of Designation of Origin since 17 July 2009. Meanwhile, the Croatian Prošek wine, even though it has been produced since hundreds of years ago, enjoys no such protection or protection as a “geographical indication” protection, due to the failure of the Croatian national authorities to protect this name.
EC Regulation No. 1234/2007 (Single CMO Regulation) lays down the rules on the protection of “designation of origin” (DO) and “geographical indication” (GI) of wines marketed within the EU, independent whether they originate from an EU Member State or a third country. The DO or GI protection of wines originating from third countries (as Croatia was before joining the EU) is possible without going through the entire procedure set out in the Single CMO Regulation, provided that such protection is initially granted on national level (Article 118d). Croatian Prošek was not protected on national level and therefore could not obtain protection on EU level anymore.
No focus on protection of the names of local products
In order to convince the EU for its membership in the Union, Croatia had to solve several issues. Clearly, during that period there was no focus on protection of products, such as Prošek, on EU level. In fact, besides the Prošek wine, many other Croatian products (http://www.croatiaweek.com/no-croatian-products-with-european-protection/) lack protection on EU level. This might be the result of a weak IP protection policy, which maybe characterizes not only Croatia but also other western Balkan countries that aspire EU membership such as Albania, Bosnia and Herzegovina, Kosovo, Montenegro, Serbia and The Former Yugoslav Republic of Macedonia. This case should serve as a lesson to those countries so that they ensure that their products are properly protected before their eventual entry into the EU. See also this article.
Back to the bottles
Coming back to the Processo and Prošek dispute, why is it forbidden to use the name Prošek for Croatian sweet wine since 1 July 2013? Italian Prosecco producers claimed that the name Prošek is too similar to their already protected name. The name Prošek might therefore confuse those consumers who intend to buy Prosecco but end up buying Prošek. Such claims were followed by the threats of the Italian Prosecco wine producers about complaining to the EU authorities in case the Croatian wine producers would continue to market their wines under the name Prošek.
One could argue that the first paragraph of article 118j of the Single CMO Regulation allows the registration of a name that is wholly or partially homonymous with that of a name already registered. However, this argument will not be successful as the local and traditional usage and the risk of confusion are decisive factors in determining a permissible registration. The traditional usage of the name Prošek and this wine`s qualities and differences when compared to Prosecco may be found here, here and here. Looking at the differences between the sweet Croatian Prošek and the sparkling Italian Prosecco, I couldn’t help but wonder how a consumer would confuse a bottle of Prošek with a bottle of Prosecco.
Conclusion: take up that challenge!
The Croatian authorities gave the impression that they gave up trying to protect the name Prošek, without fighting for it. The threat of being sued for marketing the Croatian wine under the name Prošek does not necessarily mean that the European court would decide in disfavor of Croatia. The Court of Justice has to decide whether or not the names Prosecco and Prošek may co-exist (as in the similar case with the Hungarian “Tokaj” and the Italian “Tocai” (See joined cases C-23/07 and C-24/07, ‘Confcooperative Friuli Venezia Giulia and Others’).
The author is grateful to Arber Gjunkshi, paralegal at Axon Lawyers, for his valuable contribution to this post.