Australia: 2016: Changes ahead for food businesses. Are you ready?

There are two key dates for food businesses under the Australian New Zealand Food Standards Code (Food Standards Code) in the new year.

Firstly, Food Standard 1.2.7 (which regulates the way in which businesses can make nutrition content and health claims on food labels and in advertising) becomes mandatory from 18 January 2016 following the conclusion of a 3 year transition period. No stock in trade period applies post 18 January 2016. Secondly, the revised Food Standards Code will apply from 1 March 2016 with no transition period applicable. Further changes are also likely in 2016.

18 JANUARY 2016

Food Standard 1.2.7 becomes mandatory

Food Standard 1.2.7 (Nutrition, health and related claims) becomes mandatory from 18 January 2016. This follows a 3 year transition period during which businesses have been able to choose between complying with transitional Food Standard 1.1A.2 or the new Food Standard 1.2.7.

Food Standard 1.2.7 allows businesses to make voluntary claims in relation to the nutrition content of food (e.g. "low in fat") as well as claims about the relationship between food and health (e.g. "contains calcium for strong bones and teeth").

There is no further stock in trade transition period which means that all stock on shelves must be compliant from 18 January 2016 onwards.

If they haven't already done so, businesses in the food industry should conduct a final review of all food packaging and advertising to ensure it is compliant.

1 MARCH 2016

Revised Code applies

The revised Food Standards Code was gazetted in April 2015 and becomes mandatory from 1 March 2016. The Revised Code (available here) is intended to be a structural revamp of the current code with no substantial changes to provisions that impose requirements or obligations. However, the introduction of the Revised Code will affect how the Code is applied and enforced on a state and territory basis.

Businesses in the food industry should ensure that they are familiar with the Revised Code in time for the 1 March 2016 deadline.


1. Health Star Rating System (HSR System)

The HSR System commenced on 27 June 2014 and is voluntary for the first five years. A review is scheduled to take place in June 2016. Under the HSR System, packaged foods receive a rating of ˝ a star to 5 stars based on a calculation which considers the food's nutrient and overall energy content.

Businesses in the food industry have started utilising the HSR System and in doing so have begun identifying and submitting potential anomalies within the HSR System to the Health Star Rating Advisory Committee (HSRAC) which is responsible for overseeing the implementation and evaluation of the HSR System. The outcome of the HSRAC's reviews thus far (as published in a Register of Potential Anomalies available here) has been to reject the majority of anomaly submissions made (12 submissions rejected out of a total of 13 submissions considered by HSRAC to date).

Businesses considering making an anomaly submission to HSRAC should review the register available on line and ensure they include technical information to substantiate their anomaly submission.

2. HSR System graphic to be exempt from certain nutrition content and health claim requirements

FSANZ Proposal P1037, which exempts the trade marked graphic used in the HSR System from nutrition content and health claim requirements under Food Standards 1.2.7 and 1.2.8, came into force on 7 December 2015. For example, under the exemption, use of the trade marked sodium nutrient icon (without the 'low' descriptor), will not trigger the nutrition content claim requirement to declare potassium in the NIP (which might be costly and a disincentive for industry to adopt the voluntary HSR System). Businesses using other non trade marked elements of the HSR System (such as the 'low' and 'high' descriptors, 'positive' nutrient icons and the energy icon when displayed without the star rating) will need to continue to comply with relevant claim requirements under the Food Standards Code (including under Food Standard 1.2.7). A transition period for the P1037 variations ends 17 January 2017, during which time a food product may comply with the Code as varied by P1037 or the Code in force prior to the P1037 variations (but not both).

3. Vitamin and mineral claims and sodium claims for foods containing alcohol

FSANZ Proposal P1038 also came into force on 7 December 2015. This proposal addresses two discrepancies which have arisen since the introduction of Food Standard 1.2.7. Firstly, when Food Standard 1.2.7 becomes mandatory on 18 January 2016, nutrition content claims about sodium and salt in relation to food containing more than 1.15% alcohol by volume will be prohibited. FSANZ identified soy sauce as a particular concern, as some fermented soy sauce products containing more than 1.15% alcohol by volume currently make sodium or salt claims. Secondly, Food Standard 1.2.7 has created a discrepancy in the conditions for nutrition content claims about vitamins and minerals between Standards 1.2.7 and 1.3.2 (Vitamins and Minerals).

Proposal P1038 ensures that nutrition content claims about sodium and salt in relation to food (but not beverages) containing more than 1.15% alcohol by volume continue to be permitted after January 2016. This will enable suppliers to continue to alert consumers to reduced or low sodium/salt varieties of these foods.

Proposal P1038 also ensures that vitamin and mineral content claims about foods fortified with vitamins or minerals that are affected by the discrepancy will continue to be permitted as they were before Food Standard Food 1.2.7 was originally gazetted.

4. Country of origin labelling

On 4 December 2015, the Australian government released a Consultation Regulation Impact Statement (RIS) on country of origin labelling (available here). The Consultation RIS examines the advantages, disadvantages and costs of potential improvements to the country of origin labelling framework. The Consultation RIS invites submissions on a number of key amendments to Australia's country of origin labelling requirements including:

  • replacement of the country of origin labelling requirements under the Food Standards Code with a Country of Origin Food Labelling Information Standard under the Australian Consumer Law;
  • changes to the Australian Made / Australian Grown certification trade marks; and
  • draft safe harbour defence amendments.

Businesses in the food industry should familiarise themselves with the proposed changes and consider making a submission on the Consultation RIS prior to the submissions deadline of 5pm (AEST) 29 January 2016.

5. Recent ACCC enforcement action

The ACCC has identified truth in advertising, particularly where misleading claims are made by large businesses, as a priority enforcement area for the ACCC. Recent action by the ACCC (including the issuing of infringement notices) within the food industry serves as a warning to industry participants that claims made on food packaging and in advertising must be accurate and not false or misleading. The ACCC has further indicated that fine print disclaimers should not be used to correct or qualify a prominent claim on packaging or in advertising that is false or misleading.

6. Review of the Australian Consumer Law in 2016

On 1 December 2015 the ACCC announced that a scheduled review of the Australian Consumer Law will take place in 2016 with a final report expected in March 2017.

The ACCC has also flagged some possible areas for review including the adequacy of the ACL penalty regime in achieving deterrence, the application of the ACL to the sharing economy and challenges around adopting trusted international product safety standards.

We will provide further updates on the 2016 ACL review and its implications for food businesses over the coming year.

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.

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