With less than two years to go, businesses must change their food labels to comply with new law
In brief: Your label is your word. Businesses are now required to provide greater transparency and state the country of origin of the contents of their packaged food or face large penalties.
On 1 July 2016, the Australian Government introduced a new country of origin food labelling system. With less than two years to go, businesses must change their food labels to comply with the new law before it becomes mandatory on 1 July 2018. Those who fail to comply will face large penalties.
What you need to know
- The new law will come into force from 1 July 2018.
- The Country of Origin Food Labelling Information Standard 2016 commenced on 1 July 2016 and applies to food offered for retail sale in Australia, e.g. food sold in stores or markets, online or from vending machines.
- Food products sold in Australia will require labels that clearly show the percentage of the product made from Australian ingredients.
- Businesses need to check their supply agreements carefully to ensure changes are made to meet in-store deadlines.
- If businesses are found to be in breach of the new rules, they could risk facing penalties under the misleading and deceptive conduct provisions of the Australian Consumer Law set out in Schedule 2 of the Competition and Consumer Act 2010 (Cth), which can be up to $1.1 million per contravention.
The new Standard
If you are a food producer, or are importing and/or distributing food into Australia using country of origin labels that state the product was made in a particular country, you now have just over 12 months to ensure your products comply with the new Country of Origin Food Labelling Information Standard under the Australian Consumer Law (ACL). ACL requirements will come into force from 1 July 2018.
The Country of Origin Food Labelling Information Standard 2016 (Standard) commenced on 1 July 2016, under the ACL, which means that by now, businesses are almost half way through the two-year transitional period during which both new and old laws apply.
What do the new labels look like?
Under the new law, food products sold in Australia will require labels that clearly show the percentage of the product made from Australian ingredients. To assist businesses with the new labelling requirements, the Government has set up several websites to use as reference resources, including:
- Department of Industry: Information about the new labels http://www.foodlabels.industry.gov.au
- ACCC: General information about country of origin labelling https://www.accc.gov.au/consumers/groceries/country-of-origin
- ACCC Guide for business: country of origin food labelling https://www.accc.gov.au/publications/country-of-origin-claims-and-the-australian-consumer-law
Are there any exceptions from the country of origin labelling?
The new law applies to food intended for retail sale in Australia, e.g. food sold in stores or markets, online or from a vending machine. The law does not apply to food sold for immediate consumption in places like:
- take-away shops
- food provided by caterers
If you are in the business of food, then now is the time to conduct a review of your entire branding and labelling to ensure these are fully compliant. As the Government continues to campaign the new Country of Origin food labelling laws, consumers are becoming more knowledgeable and expect information on food labels to be accurate. The potential for a surge in regulatory action, deceptive food labelling claims, advertising lawsuits, and subsequent brand damage could become a real threat to your business.
There is no time like the present to conduct an audit of all of your packaged food branding and labelling to determine whether your labelling is "consistent, compliant, and protected". If you would like any further assistance on determining your packaging compliance, or would like any assistance with your company's branding do not hesitate to contact me.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances. Madgwicks is a member of Meritas, one of the world's largest law firm alliances.