Trend Watch 2013: Nutrition Labels, Food Safety, and the Farm Bill

Proposed Rules Meeting

Exporters and importers should plan for major changes in FDA regulations for nutritional labeling, health claims, food safety and the import of olive oil in the coming year. The agency is under intense pressure by consumer advocacy groups and the media to implement the Food Safety Modernization Act (FSMA) and revise its standards of the Nutritional Labeling and Education Act (NLEA). It is likely, that exporters and importers will face greater scrutiny of their products at the border, the warehouse and the stores by FDA inspectors and consumers alike and the trade partners are well advised to plan for rigorous record keeping and potential recalls.

Here is an overview of five recent developments. Upon request, we will provide updates, in-depth analysis, and regulatory insights.

FDA may consider changes to NLEA standards of calories and serving sizes
In a recent letter to Food and Drug Administration chief Margaret Hamburg, the Center for Science (CSPI) in the Public Interest urged the agency to revise its serving-size regulations. The nonprofit consumer group advocates increasing the Reference Amounts Currently Consumed (“RACC”), which were established in the 1970s and may not reflect current consumer eating behavior. Moreover, CSPI wants FDA to take enforcement action against manufacturers who “understate the serving size for single serve products so that the actual consumption of sodium, fat or calories per serving is not revealed.” Recent USDA mandated changes to the nutrition labels on meat now show portion sizes and how many servings are in a package to help people make better caloric choices. On the flip side, recent studies claim that some nuts, seeds and vegetables contain less up to 20% fewer calories than stated in the RACC and that labels should be changed accordingly. The Almond Board of California is petitioning the FDA already to reduce the reference amount for almonds. FDA may look at a complete overhaul of the NLEA over the next two years.

Fortified Foods get a closer scrutiny
The Food & Drug Administration currently examines how consumer perceive the nutritional value of fortified foods. In 2004, the agency issued a set of principles for the fortification of food based on the belief that “random fortification of foods could result in over- and under-fortificaton of consumer diets and create nutritional imbalances in the food supply.” The fortification of fresh produce, meat, poultry, fish, sugar, candies, snacks and carbonated beverages is considered “not appropriate.” Exporters should expect greater scrutiny of claims and ingredients used in fortified food products

EU organic labels now permitted in the US and Canada
One positive breakthrough in the attempts to harmonize transatlantic standards and regulations is the agreement on organic food labels between the US and the EU. As of August 2012, EU organic symbols now suffice to declare a product organic. Previously, an organic food product had to comply with USDA standards to be labeled “organic” or carry he USDA organic seal. This agreement will reduce costs for exporters and their US trade partners . However, country-specific organic labels, such as the German Bio-Siegel, are not included in the agreement . That means, food products certified only according to German Bio-Siegel norms can still not be declared “organic” in the US.

FSMA Inspection fees and importer verification
It is not a secret that the implementation of the Food Safety Modernization Act by the FDA has slowed significantly over the last months. This is primarily due to the lack of sufficient funding and the unavoidable lengthy legal review of each new regulation. So far, the FDA has done a great job to keep all constituents informed about the progress of the FSMA implementation and to minimize the effects on international trade. However, mandated recalls of domestic and imported food products have increased dramatically, as have detentions of container at the border. Exporters and their importers are well advised to jointly plan and implement record keeping of HAACP procedures, potential recalls, and supplier verification mandates. At some point over the next year, FDA inspectors will control the offices or facilities of importers and exporters. The first visit is free, but any re-visit due to careless mistakes can be very costly. A third-party audit and certification based on Global Food Safety Initiative standards (such as IFS) may reduce the frequency of inspections or the risk of failing an inspection of production facilities, importer offices, warehouses and logistics providers.

The Rise of “Nanny State” Nutrition Laws
While it may take a while, before federal FD inspectors knock on the door, local and state agencies may act sooner. Over the past years, county and state legislatures have passed laws regulating what can be served in restaurants and supermarkets. A recent article in the Washington Post reported on a forced recall of completely safe white tuna salad. The problem: the salad contained partially hydrogenated vegetable oil. This oil contains trans-fats. And these are outlawed in Montgomery County, the largest county in Maryland. A consumer complaint lead to the inspection and the retailer was forced to pull the products off the shelves. In New York, a recent decree bans the sale of super-sized soft drinks in Manhattan. In the state of Washington, local taxes on sweets and soft drinks may come into effect over the next years. Exporters and importers need to be aware that “nanny laws” (regulations for the sake of consumer protection) may differ from state to state or between counties in one state and that consumers and local health inspectors increasingly look at the legality of labels.

New Farm Bill may mandate new standards for imported olive oil and honey
Both houses of the US Congress still have not passed the US Farm Bill 2012 into law. Although the US Senate passed their version, as did House of Representative’s agriculture committee, the full House of Representatives has yet to vote on the bill. One of the more contentious issues: a marketing order for olive oil. According to Section 10010 in the Farm Bill, olive oil may soon be included in import controls under the Agricultural Adjustment Act. That means that olive oil imports not conforming to certain US standards may be rejected at the border. What these standards will be is yet to be determined. Along the same lines, section 10008 requires research into the establishment of a standard

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