The era of nudging: EU’s proposals for mandatory front-of-pack labeling

As part of the EU Farm to Fork Strategy for a sustainable food system under the Green Deal, the European Commission agrees that nudging is necessary to guide the consumer to healthier and more sustainable food choices. This has translated into two impact assessments for mandatory front-of-pack (FOP) labeling. Various EU Member States and individual food business operators are however not waiting for harmonized EU FOP labeling and adopted the nutri-score (guiding health choices) and/or eco-score (guiding sustainability choices). This blogpost shows how these initiatives fit into the current and upcoming legal framework.

 

Nutri-score

Nutri-score is a five-color nutrition label demonstrating the overall nutritional value of a food product front-of-pack. It allows consumers to compare various foods in a simple and fast way. The label is based on a scale of 5 color and letters, from a dark green “A” for the most healthy choice to a red “E” for the least healthy choice. Simply put, the algorithm behind nutri-score allocates positive points for favorable dietary components (fruits, vegetables, pulses nuts, fibers and proteins) and negative points for energy and unfavorable dietary components (saturated fatty acids, sugars and sodium). The total positive points are subsequently subtracted from the total negative points. The lower the score, the better the letter/color grade.

 

Fighting nutrition-related non-communicable diseases

The aim of nutri-score is to nudge the consumer into healthier food choices, and to stimulate the food industry to reformulate their recipes. This way, nutri-score should contribute substantially to a reduced burden of nutrition-related non-communicable diseases such as diabetes, cardiovascular diseases and some types of cancer.

 

Legal basis

From a legal perspective, nutri-score qualifies as voluntary food labeling in accordance with article 36 FIC Regulation. Food business operators that opt for using nutri-score are however obliged to use it for all foods they place on the market to avoid cherry picking. Moreover, a green “A” or “B” score additionally qualifies as a nutrition claim under the Claims Regulation. Since the claim is not listed in the annex to the Regulation, Member States adopting the nutri-score are subject to the notification procedure of article 23 of the Claims Regulation.

 

Algorithm changes

Countries that implemented nutri-score (France, Belgium, Luxembourg, Germany and Switzerland) or are willing to use it (Netherlands and Spain) join forces to ensure that nutri-score is in line with the national dietary guidelines. To coordinate such, the abovementioned countries established a Steering Committee and Scientific Committee in February 2021. The Steering Committee is composed of two representatives from national authorities in charge of the nutri-score implementation in each country; the Scientific Committee includes one or two independent experts nominated by each country involved. On March 7 last, the Scientific Committee published its interim report in which it proposes a methodology for modification of the nutri-score algorithm to handle problematic food categories (fats and oils, fish and seafood, whole grain products, salt, sugar, beverages, and dairy products). The Scientific Committee aims at providing a fully revised version of the nutri-score algorithm before the summer. The Steering Committee will have the final say in the recommendations proposed by the Scientific Committee and, where relevant, will elaborate a support document for food business operators to facilitate the appropriation of algorithm changes by the end of the year.

 

Developments at EU level

In the meantime, the European Commission held a public consultation to introduce standardized mandatory FOP nutrition labeling as part of the revision of the FIC Regulation within the EU’s Farm to Fork strategy. In its impact assessment, it listed five options:

  1. Baseline (“business as usual”) – it remains possible to voluntarily use a public or private, non-harmonized, FOP label.
  2. Nutrient- specific labels (numerical) – a harmonized FOP label such as the Italian Nutrinform Battery, providing numerical information on the content of macro nutrients and the energy value of a food, as well as the percentage of the daily refence intake that it makes up for.
  3. Nutrient-specific labels (color-coded) – a harmonized FOP label such as the UK Multiple Traffic Lights, which is similar to the numerical label but in addition uses colors to classify the content of nutrients as green, amber or red.
  4. Summary labels (endorsement logos) – a harmonized FOP label such as the Keyhole used in Sweden, which can be applied only to foods that comply with certain beneficial nutritional criteria.
  5. Summary labels (graded indicators) – a harmonized FOP label such as nutri-score, providing an appreciation of a product’s overall nutritional value through a graded indicator.

The harmonized FOP nutrition label as listed under 2 – 5 above could be either voluntary or mandatory, which is still subject to debate. The impact assessment also mentions the possibility of having a policy mix rather than using one preferred option. Next to the outcome of the public consultation, the European Commission will take into account the comprehensive review on FOP nutrition labeling schemes by the Joint Research Centre (2020) on EFSA’s recent scientific advise on nutrient profiling. A legislative proposal is expected in Q4 2022.

 

Eco-score

Eco-score can be seen as the equivalent of nutri-score in the field of sustainability. Just like nutri-score, eco-score is a French initiative. It shows the consumer the environmental impact of a food, using the same presentation as nutri-score in terms of colors and letters. The food’s environmental impact is measured in two steps. First, the environmental footprint is calculated using the Product Environmental Footprint (PEF) method, which is based on a Life Cycle Assessment (LCA). The PEF method takes into account 16 different impact categories, such as ozone depletion, land use and climate change. This eventually translates into a score between 0 and 100. Thereafter, bonus points can be added up or minus points can be deduced from this score. These extra points (positive or negative) are based on 4 additional criteria: (1) food production methods as measured through attributed third-party sustainability credentials such as organic certification, fairtrade or MSC, (2) recyclability of the packaging, (3) the provenance of ingredients, and (4) the stay-away from biodiversity-related issues such as overfishing and deforestation. The LCA takes place at product category level; the allocated bonus and minus points are related to the individual product.

 

Legal basis: currently no specific rules  

There is not yet a legal framework specifically dedicated to environmental claims, let alone a legal definition thereof. Environmental claims are currently enforced based on general rules, guidelines and self-regulation within the legal framework of unfair commercial practices and misleading advertisements, as discussed in our earlier blogpost. Interestingly, these different sources produce different definitions of environmental claims. The definition thereof in the Dutch Code for Environmental Advertising is for example very broad and includes the eco-score as a claim related to the environmental factors connected with the product. It is however questionable whether an eco-score “C”, “D” or “E” would fall under the definition of a ‘green claim’ under the EC Guidance on the Unfair Commercial Practices Directive. This latter guidance namely refers to a positive environmental impact (which products with lower scores have not) or a lower damaging impact on the environment than competing products. Since the eco-score algorithm is largely based on product categories rather than individual products, it is not necessarily suitable for comparisons between competing products such as for example different fruit juices. Assuming that eco-score does qualify as an environmental claim, the following question is whether it is in conformity with the applicable rules. These rules are however not black and white and leave room for interpretation, especially since the number of enforcement cases is still rather low.

 

Future situation: EU harmonization of eco-score?

The ambiguity illustrated above may be over with in the near future, since the European Commission is working towards the harmonized use of a sustainability label under its Farm to Fork Strategy and the transition towards a sustainable food system. In its impact assessment, it lists the following options:

  1. Baseline (“business as usual”) – No specific new actions, though existing initiatives on environmental claims will be continued, such as the upcoming legislation on the substantiating of environmental footprint claims by use of the PEF or OEF (organizational environmental footprint) method.
  2. Voluntary approaches – No legislative initiatives but guidance and private initiatives such as codes of conducts.
  3. Reinforcing existing legislation – Development of sustainability labeling provisions related to more than one sustainability component (such as environmental and social sustainability) through existing sector-specific legislation (for example fisheries marketing standards).
  4. Voluntary EU sustainability label – Development of a voluntary harmonized sustainability label, either applicable to all foods or to foods that meet a certain sustainability standard only.
  5. Mandatory EU sustainability label – Development of a mandatory harmonized sustainability label, either for all foods placed on the EU market or mandatory for EU produced foods and voluntary for imported foods.

A legislative proposal is expected in Q4 2023. Until July 21 of this year, it is possible to contribute through the public consultation.

 

Meanwhile in the Member States….

Member States seem not to be waiting for the legislative proposals of the European Commission. Instead, various Member States launched national initiatives on FOP sustainability labels and join forces to ensure that such labels will be implemented in a similar way throughout the EU. Taking the Netherlands as an example, the Ministry of Agriculture, Nature and Food Quality aims to implement a voluntary sustainability label for foods in the Netherlands by 2025. This goal forms part of the National Climate Agreement. Together with the food sector and other stakeholders, the Ministry is currently investigating how such a label for the Dutch market could look like. LCA’s based on the PEF-method are taken as a starting point for further development.

 

Conclusion

FOP labeling is a topic of conversation. Various initiatives on both national and European level are taking place simultaneously, in the hope that they will once come together as an EU harmonized label. We see different food businesses reacting to this situation differently. Where some opt for awaiting formal decisions at national level and instructions by the government, others are pioneering and experimenting with FOP labeling within the currently existing legal framework. Examples include the nutri-score pilot by Iglo and the full-fledged use of eco-score by Colruyt Group in Belgium. What about you? Are you a game changer or a laggerd?

Together with Lisa Gray from Iglo and Veerle Poppe from Colruyt Group, Jasmin Buijs presented this topic at the VMT Food Law Event on June 7 last.


This will change (soon): an update on environmental claims legal & policy framework

Many companies wonder what kind of environmental claim they can make for their product or packaging. Although there is no specific legal framework for this (yet), environmental claims fall under the general prohibition on misleading practices. Thanks to various developments at the European level, the legal framework for environmental claims is shaping up.  Below is an update of the latest developments.

 

New guidance on the Unfair Commercial Practices Regulation

At the end of last year, the European Commission published an update of its guidance on the Unfair Commercial Practices Directive (“Revised Guidance”). The guidance provides amongst others an interpretation of the general prohibition on misleading practices in the aforementioned directive. Although the guidance has no legal status, it concerns an authoritative document. Judges and regulators such as the Netherlands Authority for Consumers and Markets (ACM) regularly refer to it. With regard to environmental claims, the Revised Guidance continues the line as set forth in its previous version from 2016. At certain points the text has been more detailed and more extensive examples are provided. However, the Revised Guidance also highlights a number of new points. The most striking additions are as follows.

 

Use of logos and labels

Environmental claims must be presented in a clear, specific, accurate and unambiguous manner. Simply placing a logo on a packaging will generally be insufficient to meet the above requirements since the average consumer cannot be expected to be familiar with the meaning thereof. This is not surprising considering that there are more than 100 sustainability logos in the EU. To prevent misleading practices, the Revised Guidance prescribes informing the consumer on the meaning of the logo, whether certification is done by a third party or not, and where further information can be found. These requirements are not absolutely new since they can also be found in the Guidelines sustainability claims issued by the ACM and the Code for Environmental Advertising by the Dutch self-regulatory organization of advertising (of which an update is expected this year). What is more is that the Revised Guidance sets forth additional requirements in case private instead of public quality marks are being used. The European Commission therefore seems to hint at a preference for public quality marks (e.g. EU Ecolabel, the Nordic Ecolabel ‘the Swan’ or the German ‘Blue Angel’) over private quality marks and to aim at a reduction of the total number of such marks. In this context, the ACM calls upon companies to use existing quality marks instead of developing their own.

 

Use asterisk for reference to additional information

It follows from the above that environmental claims (including logos) sometimes need further explanation to be well understood by the consumer. This is especially the case for general terms such as “sustainable” and “good for the environment”. A clarifying text should be placed as close as possible to the general claim, preferably right next to it. Another place may be chosen if there is no room for this, such as on the back of the packaging on which the claim is presented. An asterisk can be used to make the connection between the main claim and the additional information. A similar suggestion is made in the ACM Guidelines sustainability claims. The Revised Guidance states that when there is no room to specify the environmental claim, the claim should in principle be omitted.

 

Sharing information with competent authorities, but not with consumers

Environmental claims should be based on evidence that can be verified by the competent authorities. Authorities requesting such evidence are expected to take into account confidential information of the company making the environmental claim (such as certain input data for an LCA). The Revised Guidance emphasizes that the Unfair Commercial Practices Directive does not contain an obligation to provide such evidence to consumers (upon request). The ACM however takes a different position on this matter in its Guidelines sustainability claims, referring to the Guidelines for Making and Assessing Environmental Claims (2000) of the European Commission. The ACM advises placing evidence that substantiates the claim on a website and referring to it on (the packaging of) the product concerned. It also states that consumers should be provided with more information about the evidence concerned upon request. This raises the question how to deal with confidential information. A practical solution is to remove confidential information (provided this does not render the information concerned practically illegible), or to make a summary of the evidence for the claim available as a ‘consumer version’.

 

Completed public consultation on bio-plastics

Bio-plastics are a hot topic these days. These include ‘bio-based’, ‘biodegradable’ and ‘compostable’ plastics. Where bio-degradable plastics degrade and eventually dissolve due to changes in their chemical structure, the idea behind compostability is that a soil improver remains after the composting process. In contrast, bio-based plastics are plastics made from components derived from natural materials (as opposed to fossil-based materials). Bio-based plastics are not necessarily biodegradable or compostable. The EU is investigating the following policy areas with regard to bio-plastics.

 

Sustainability of natural materials vs. fossil resources

Plastics based on natural materials are often advertised as being more sustainable than fossil-based plastics. The question is, however, whether such natural materials offer real environmental benefits beyond a reduction in the use of fossil resources. To measure those benefits, the environmental impact of the full life cycle of such materials needs to be considered. This includes amongst other things the origin of the raw materials used. The use of arable land to grow natural materials for bio-plastics while this land could have been used for food is for example not necessarily ‘sustainable’.

 

Effective biodegradability and its role in a circular economy

As far as biodegradability is concerned, it is being investigated whether and how plastics with this property fit into a circular economy. After all, there is little ‘circular’ about products that ‘dissolve’ in nature; reuse and recycling may offer better alternatives. It may at the same time be useful for certain product groups if they break down under specific conditions. An example of this could be agricultural film, which is not always removed completely after harvest and which is not easy to recycle after use due to contamination with soil. Similar questions arise with regard to compostable plastics. At best they break down into water and CO2, and therefore cannot contribute to soil improvement. Biodegradation of so-called compostable plastics could however also be useful for certain product groups. Think for example of compostable coffee and tea bags, which create a co-benefit when their use results into more coffee and tea being disposed in the green bin and subsequently composted.

 

Misleading practices

The prevention of misleading practices is also on the agenda. The European Commission recognizes that there is currently much confusion among consumers about bio-plastics. Stricter rules for the use of this and similar terms can prevent greenwashing. Moreover, it must be prevented that consumers interpret a biodegradability claim as a license to litter packaging with this characteristic.

From 18 January to 15 March 2022, a public consultation took place at European level concerning the policy framework currently being under construction. Publication of the policy framework is planned for this summer.

 

European policy framework PEF and OEF

Environmental footprint claims, just like other environmental claims, need to be supported by evidence. There is however no harmonized method for substantiating such claims. Having said that, EU standard methods for the ecological footprint of products (PEF) or organizations (OEF) do exist since 2013. These methods focus on the measurement of the environmental performance of a product or organization over its entire life cycle using 16 environmental impact categories, including climate change, ozone depletion and water use. The European Commission is currently exploring the possibilities of putting more emphasis on the use of the abovementioned methods for the substantiation of environmental claims. The outcome of this study was planned for the first quarter of this year, but is still pending.

 

Ecodesign

There is even more happening in the field of sustainability in Brussels. On 30 March of this year, the European Commission adopted a proposal for a revised directive establishing rules for sustainable products (“Revised Ecodesign Directive”). Sustainable products will become the norm, with reusability, recyclability and energy efficiency being key concepts.

 

Food products are excluded from this European proposal on sustainable products. It is also unlikely that the Revised Ecodesign Directive will set specific rules for packaging materials meant for food contact. The rules to be established for packaging materials will namely be introduced via product-oriented requirements for products that do fall under the Revised Ecodesign Directive.  This initiative nevertheless does mark a spot on the European sustainability horizon, which will also determine the direction for sustainability rules on packaging materials for foodstuffs.

 

Conclusion

Environmental claims are a topic of attention at national and European level. Food and food packaging businesses that make or wish to make environmental claims are therefore advised to keep an eye on current developments. Stay tuned!

 


Dairy under attack … and strikes back!

How to strike the right balance between freedom of speech and preventing unfair advertising targeting the dairy industry? This is the object of a Q4 2021 decision of the Appeal Board of the Dutch Advertising Code Committee, consisting of an advertising campaign on bus shelters in the Netherlands and a website campaign. If you are interested to know how broad the scope of “advertising” is and how a rather aggressive campaign was evaluated, continue reading. This post will be limited to the bus shelter campaign only since that already demonstrates the operation of the applicable legal framework.

Bus shelter campaign attacking dairy industry

The bus shelter campaign showed several very explicit pictures demonstrating the misery life of young calves. Under the title “Do you need help quitting?” information was provided on the consequences of the dairy industry for these calves. The text on the various posters in the bus shelters stated the question “Do you need help quitting?”, followed by the following texts:

  • Poster 1: “ “Dairy causes serious animal suffering. Calves are taken away from their mothers immediately after birth.”
  • Poster 2: “Dairy is deadly. On a yearly basis, 1.5 million calves are slaughtered for dairy”.
  • Poster 3: “Milk destroys more than you like. Calves are being fed artificial milk because the cow’s milk ended up in your cappuccino.”

The wording used above appeals to two well-known anti-smoking and anti-alcohol campaigns in the Netherlands, notably “quit smoking” and “alcohol destroys more than you like (your marriage for example).” The driver behind the anti-diary campaign is the Dutch organisation Animal & Law (“Dier & Recht”) that claims to be voice of the animals. This campaign was opposed by the Dutch dairy organization DairyNL (“ZuivelNL”), that aims to strengthen the Dutch dairy chain in a way that respects the environment and society. DairyNL considered this campaign misleading and therefore unfair.

Scope of the Dutch Advertising Code

The Netherlands knows a system of a self-regulation for advertising, embodied in the Dutch Advertising Code. Companies and other organisations can choose to submit to this system and the outcome (so-called recommendations) of cases based on complaints by whoever considers an advertisement misleading has a high degree of compliance (97 % in 2020). Animal & Law argued that their campaign was out of scope, as it did not envisage selling any products or services. Instead, it alleged to be a non-profit organisation that by public campaigns aims to improve the (legal) position of animals. Alternatively, it argued that if their campaign was captured by the scope of the Dutch Advertising Code, it would benefit from the principle of freedom of expression, as protected by the European Convention on Human Rights. Animal & Law overlooked however that the Dutch Advertising Code also captures ideas that are systematically recommended by an advertiser. The anti-dairy campaign by Animal & Law was found to meet this test. The Advertising Code Committee (“Reclame Code Commissie”) subsequently assessed for each bus shelter poster whether the information constituted misleading advertising.

Test for misleading advertising

The test applied is as follows: Advertising is unfair if it contravenes with standards of professional conduct and if it substantially disrupts or may disrupt the economic behaviour of the average consumer. One could consider this is exactly what Animal & Law was after and for a good cause. Under the Dutch Advertising Code however, aggressive advertising is at any rate considered unfair. Furthermore, all advertising containing incorrect or ambiguous information regarding specific aspects of the product at stake is considered misleading, if such information entices or may entice the average consumer to take a transaction decision (including refraining therefrom) that such consumer otherwise would not have made.

Poster 1

Just below the text “Do you need help quitting?” a milk carton is shown depicting a young calf being led away in a wheelbarrow followed by the text “Dairy causes serious animal suffering. Calves are taken away from their mothers immediately after birth.” All of this is depicted within a black framework, just like the health warning on a box of cigarettes. DairyNL argued, amongst other things, that according to the Netherlands Nutrition Centre, the consumption of dairy fits into a healthy diet, whereas the reference to quitting creates the impression dairy is very bad for human health. During the hearing, Animal & Law acknowledged that it is incorrect to state in general that dairy is not healthy. The Advertising Code Committee therefore considered the information re the quitting provided on poster 1 to be ambiguous and thus misleading. This results in unfair advertising.

Poster 2

This poster shows the same setting as poster 1, namely a milk carton depicting an earmarked calf surrounded by a black framework. According to DairyNL, in this context the text “Dairy is deadly. On a yearly basis, 1.5 million calves are slaughtered for dairy” can only be understood as a health warning. Furthermore, the absolute claim on the number of slaughtered calves creates the impression that this slaughter can only be attributed to the dairy industry, whereas it also serves meat production. Animal & Law had responded that calves are merely a by-product of dairy. It had used the warning that “dairy is deadly” to awaken the conscience of consumer. Obviously, the consumer understands the calf is going to die, not the consumer. The Advertising Code Committee considered this warning to be misleading, for the same reason as mentioned above. This part of the advertising was therefore considered unfair. The complaint regarding the slaughter was strikingly not addressed. I deduce therefrom that at any rate it was not concurred with.

Poster 3

On this poster, a calf is shown behind the bars of its small cage. DairyNL argued the setting of this poster (identical as described above) and the text “Milk destroys more than you like” links milk to two health hazard products, i.e. cigarettes and alcohol. DairyNL also argued that the claim “Calves are being fed artificial milk because the cow’s milk ended up in your cappuccino” creates the impression calves only drink artificial milk. Animal & Law refuted this complaint by explaining the claim does not state that calves only drink artificial milk. Animal & Law did not deny calves are being fed colostrum right after birth. However, this only takes 2 days, whereas the natural weaning period of calves amounts to 6 – 12 months. Here the Advertising Code Committee did not consider DairyNL’s  claim founded, as DairyNL did not dispute that after a few days, the calves are being fed artificial milk instead of cow’s milk.

Conclusion

So what is the result of all this and what can we learn from this advertising decision? If the campaign of Animal & Law was mainly after shock and awe, it certainly succeeded. The pictures of the calves shown in the context of health warnings for cigarettes did not miss their effect. Potentially, a number of consumers became aware of certain facts it did not realise before. But will these consumers say a definite no to dairy? That’s the question, as the campaign may also have a counterproductive effect. Personally, I expect the chances of a seductive dairy alternative much higher for inducing consumers to eat no more (or just less) dairy. The learning from this decision is that even if the freedom of expression is a major public good, it also has its limits. No purpose justifies providing incorrect or ambiguous information. This learning applies equally to those outlining the pro’s of dairy alternatives, but certainly also to those emphasizing the con’s of dairy.


Timmers Promotions