Another step against ‘palm oil-free’ labels – Members of the European Parliament call for a ban of certain misleading ‘free from’ labels
On 1 March 2018, the European Parliament’s Committee on Economic and Monetary Affairs (hereinafter, ECON) submitted its draft report for a European Parliament Resolution on the European Commission’s (hereinafter, Commission) annual ‘Report on competition policy’ to the European Parliament’s plenary. In the context of the adoption of the report by the Committee, it reportedly rejected an amendment tabled by an Italian Member of the European Parliament (hereinafter, MEP) that aimed at obliging “advertisers to declare or list only the characteristics of the ingredients actually present in the product and exclude those that are not contained therein unless the presence or absence of certain ingredients is related to congenital diseases”. While this report might not be the most pertinent choice to advance this issue, the struggle against anti-competitive, misleading and illegal ‘free from’ claims and labels, such as ‘palm oil-free’, has finally reached the European Parliament.
Every year, the Commission publishes a ‘Report on Competition Policy’, which provides detailed information on the most important policy and legislative initiatives, and on decisions adopted by the Commission in the application of EU competition law during the previous year. The Commission report is composed of two documents: 1) A Communication from the Commission; and 2) The Commission Staff Working Paper, describing the developments in more detail. Typically, the European Parliament uses this opportunity to comment on the Commission report through a resolution. The European Parliament’s ECON Committee is responsible for the preparation and consolidation of the resolution, in cooperation with further Committees of the European Parliament.
On 31 May 2017, the Commission had published the 2016 issue of the ‘Report on Competition Policy’. On 23 October 2017, the European Parliament’s Rapporteur for the Resolution, Ramon Tremosa i Balcells, submitted his draft report to the ECON Committee. The report will form the basis for the Parliament’s future resolution. On 28 November 2017, the Rapporteur published the amendments to the draft report. As Amendment 278, MEP Fulvio Martusciello of the Group of the European People’s Party, submitted the following addition to the report: “(protection of consumers against misleading or suggestive advertising) Calls on the Commission to oblige advertisers to declare or list only the characteristics of the ingredients actually present in the product and exclude those that are not contained therein unless the presence or absence of certain ingredients is related to congenital diseases”. On his website, MEP Martusciello noted that it was a joint initiative with MEP Alberto Cirio and published a joint statement. The two MEPs noted that the “the events of recent years related to some food products have made it clear that the large retail chains now tend to promote products by advertising not the ingredients they contain, but those they do not contain”. MEPs Martusciello and Cirio consider this to be a “very ambiguous practice that confuses the consumer and leads to deceptive purchases”. More specifically, the MEPs singled out ‘free from’ labels, such as ‘palm oil-free' or ‘GMO-free’, calling them “deceptive”. As MEP Martusciello notes on his website, his proposed amendment appears to have been adopted with 28 votes for it, 22 against it, and 5 abstentions. Reportedly, however, the amendment appears to have been eventually rejected by the Committee, when it voted on the adoption of the draft report on 21 February 2018. The consolidated draft of the report has not yet been made publicly available. The European Parliament’s plenary is scheduled to debate the report and vote on the Resolution on 16 April 2018.
Within the EU and beyond, there is an ongoing trend to label foodstuffs as ‘free from’, which is understood by many consumers as implying that these products constitute a healthier choice. An increasing number of products is labelled and marketed with the ‘salvation-promising’ word ‘free’: ‘lactose-free’, ‘fructose-free’, ‘gluten-free’, ‘GMO-free’ and ‘palm oil-free’. While certain ‘free-from’ claims are certainly beneficial for a range of consumers, such as those related to allergens or certain intolerances, others appear to be purely based on marketing priorities and campaigns. This has become a real trend in food marketing, suggesting that, as soon as something new appears, the food industry exploits it and helps spreading its supposed benefits, whether real or not. For a while, many food products were marketed as “light”, these days, products are increasingly labelled with ‘free-from’ claims. Food business operators and retailers are exploiting consumer’s concerns and fears, which are often based on rumours circulated about certain products, substances and ingredients.
Indeed, consumers in the EU do appear to be receptive towards such ‘free from’ claims and labels. A recent study, entitled ‘European consumer healthiness evaluation of ‘Free-from’ labelled food products’, tested four different ‘free-from’ labels, namely ‘lactose-free’, ‘gluten-free’, ‘GMO-free’, and ‘palm oil-free’, using different product categories on which these claims and labels typically appear. The study came to the conclusions that: 1) Products with a ‘free-from’ label are considered healthier than products without such a label; and 2) The strongest effects occurred for ‘GMO-free’ and ‘palm oil-free’ labelling. Noteworthy is that the study also confirmed an increased consumer willingness to pay a price premium for ‘free-from’ labelled products. The study showed that, in particular, French respondents were the most receptive to ‘palm-oil free’ and ‘GMO-free’ claims, and attributed this to French public debate and negative media coverage. Food labels are poised to influence and shape consumers’ food shopping behaviour. This change of behaviour must clearly be factored in when assessing the relevance and legality of certain ‘free from’ claims.
‘Free-from’ or ‘negative’ claims can be defined as claims indicating that certain ingredients, nutrients or substances are not present in a foodstuff. Legitimate uses of regulated negative claims in the EU, based on Regulation (EC) No 1924/2006 on nutrition and health claims, include some nutrition claims, such as ‘sugar-free’, ‘salt-free’, and ‘saturated fat-free’. Additionally, specific EU legislation exits for specific substances, such as Commission Implementing Regulation (EU) No 828/2014 on the requirements for the provision of information to consumers on the absence or reduced presence of gluten in food concerning ‘gluten-free’ claims. Certain EU Member States, such as France and Germany, have legislated on ‘GMO-free’ claims. Furthermore, a number of products on the EU market bear claims such as ‘no additives’, ‘no preservatives’ and ‘no artificial colourings’. Such so-called ‘clean label’ claims may be made as long as they are true and the use of additives in such foods is legal.
Article 7(1)(c) of Regulation (EU) No 1169/2011 of the European Parliament and of the Council of 25 October 2011 on the provision of food information to consumers, (hereinafter, FIR) on fair information practices, provides that food information must not be misleading, particularly “by suggesting that the food possesses special characteristics when in fact all similar foods possess such characteristics, in particular by specifically emphasising the presence or absence of certain ingredients and/or nutrients”. On the basis of Article 7(1)(c) of the FIR, voluntary information provided by food businesses on food products must not suggest that the food possesses special characteristics when, in fact, all similar foods possess such characteristics, in particular by specifically emphasising the presence or absence of certain ingredients and/or nutrients. This provision of the FIR addresses the legal concept of ‘misleading advertisements with certainties’, which has so far been mostly applied in cases of so-called ‘clean’ labelling.
A particular case concerns the issue of labelling products as ‘palm oil-free’, the deceptive nature of which was also highlighted by MEPs Martusciello and Cirio. For a number of years, EU food business operators and retailers, particularly in Belgium, France, Italy and Spain, have been increasingly labelling a number of foodstuffs as ‘palm oil-free’ and continue waging related marketing campaigns with a denigrating agenda. This trend continues despite the arguably clear illegality of such labels within the EU (see Trade Perspectives, Issue No. 4 of 20 February 2015). Indeed, within the EU and since 13 December 2014, the FIR provides that the specific vegetable oils must be indicated in the list of ingredients (see Trade Perspectives, Issue No. 23 of 12 December 2014). The mere listing of the generic indication ‘vegetable oils’ is no longer sufficient. However, products claiming that they are ‘palm oil-free’ and containing instead sunflower oil, rapeseed oil or any other vegetable oil, now mandatorily indicated in the list of ingredients, are still promoted as something ‘special’. Compared to similar foods that possess the same characteristics (i.e., products containing sunflower oil or rapeseed oil, which is indicated by law in the labelling’s ingredient list), but without a ‘palm oil-free’ label, these ‘palm oil-free’ labelled products are in no way ‘special’. Any consumer is able to read in the list of ingredients whether a product does or does not contain palm oil, which can no longer be ‘hidden’ behind the generic term ‘vegetable oils’. Therefore, now that in the EU the specific origin of the vegetable oil used in any given foodstuff must be declared, ‘palm-oil free’ claims are arguably obvious, unnecessary, irrelevant and illegal pursuant to Article 7(1)(c) of the FIR.
The illegality of ‘palm oil-free’ claims and labels for other reasons has to be determined on a case-by-case basis. When made in a nutritional context, these ‘palm oil-free’ claims on foodstuffs are arguably not approved and, therefore, illegal nutrition claims under Regulation (EC) No 1924/2006. Similarly, in case of accompanying further nutritional or environmental allegations, they often appear to be unsubstantiated misleading generalisations, and could be considered misleading pursuant to Article 7(1)(a) of the FIR.
In general terms, not all ‘free-from’ claims and labels are misleading and some may be helpful for all or certain groups of consumers. MEP Martusciello did not call for an outright ban of all ‘free-from’ labels, but rightfully included an exception in his amendment, calling for a ban on ‘free-from’ claims “unless the presence or absence of certain ingredients is related to congenital diseases”. The exception of “ingredients related to congenital diseases” may be too narrow, which might have contributed to the rejection of the amendment. At the same time, the increasing number of such claims and the apparent illegality of, for example, ‘palm oil-free’ claims, continues to mislead consumers and distort their choices and competition. The consumer might consider to be purchasing something ‘special’, ‘better’ or ‘healthier’, while this is not the case. The recent introduction of a ‘palm oil-free’ trademark by the International Palm Oil Free Certification Accreditation Programme is poised to further aggravate this situation.
Despite the apparent setback through the rejection of the amendment supported by MEPs Martusciello and Cirio, the struggle against anti-competitive, misleading and illegal ‘free-from’ claims and labels continues. The Commission and EU Member States’ authorities must finally realise the damage that such claims and labels are responsible for, as recently underlined by the study on the effects of ‘free from’ claims on consumers. A better enforcement of the existing rules or even the amendment of relevant EU legislation, such as the EU’s Food Information Regulation, to make the ban of such claims more explicit, should be at the top of the agenda. Entire sectors, such as palm oil producers, are suffering under the illegal campaigns waged by some irresponsible EU food and retail businesses. All interested stakeholders should contribute to the debate on the issue and engage with the relevant interlocutors.
