Australia: The debate over the appropriate use of the term - natural - in food labelling continues…

Last Updated: 14 March 2016
Article by Georgina Hey

Food labelling has long been a vexed question in many countries for governments, consumers, food producers and retailers alike. In Australia, the regulation of food labelling was substantially overhauled by the Food Standards Australia New Zealand (FSANZ) Code in 2013, with the 3 year phase in period for these changes recently ending. The difficulty that has been felt in applying the Code is clear from the considerable debate over the changes and their application, as well as the various calls for an extension to the 3 year transition period. Importantly, although the Code covers nutritional and health claims, it does not extend to regulation of the terms such as 'natural' in food labelling.

In the US, recent debate and uncertainty over 'natural' food labelling claims has been extensive. Cases have arisen (some commentators say as many as 200 in the last few years) against food manufacturers in relation to 'natural' claims being used on products containing arguably unnatural items such as genetically modified foods and artificial additives. The courts have gone so far as to previously ask the US Food and Drug Administration (FDA) to specifically address these concerns. While these previous requests were denied, in response to consumer petitions, the FDA is now taking submissions on the definition for and use of the term 'natural' on food labels. The issue has been so vexed, that late last year the FDA announced their intention to extend the period for comment by several months to May 2016.

The purpose of this article is to consider the ongoing debate regarding food labelling in Australia and the US because it is likely to continue. Any food labelling claims of 'all natural', and indeed any nutrition and health claims, will continue to be attractive to food manufacturers and retailers as health and nutrition continues to become increasingly important to consumers in the US and Australia. Therefore, debate over these claims, their underlying requirements and definitions as well as how they can be policed, will continue to be at the fore of considerations by regulators, consumers, food manufacturers and food retailers alike.

US consultation

In the US, the FDA has a "longstanding policy concerning the use of 'natural' in human food labelling". The position is that the term 'natural' is considered to mean that 'nothing artificial or synthetic' (including colour additives) has been added to or included in a food product. This position seems clear and simple, but it has proven to be woefully inadequate for the purposes of determining 'natural' claim disputes.

The FDA has now noted that the rapid changes to the food ingredient and production landscape has meant the application of this policy is no longer clear. In addition, this policy was not intended to address food production methods (including the use of pesticides) or food processing or manufacturing methods (which now extend to increasing use of thermal technologies, pasteurisation, irradiation and a growing list of new technologies). The existing policy also doesn't extend to the question of whether the term 'natural' can describe a nutritional or health benefit (being the claims currently strictly codified under the FSANZ in Australia), and this is where many ongoing claims have arisen.

The general result from this, not only in the US but also in Australia, has been for consumers to (at worst) be confused as to the food labelling claims being made, or (at best) be mistrusting of these claims, even when they are made legitimately.

Consequently, the FDA is now considering and seeking comments on:

  • Whether it is appropriate to define the term 'natural';
  • If so, how the term and acceptable use of 'natural' should be defined; and
  • How this acceptable use of 'natural' on food labels can be determined by the FDA.

The final question above really highlights just how complicated this issue is in practice, when a large, well-funded and long established body such as the FDA is struggling with how it can not only define, but also police the use of this specific term.

Current position in Australia

The FSANZ Code sets out the legislated food standards (Standards) in Australia. The Code heavily regulates nutrition content claims and health claims on food labels and in advertisements. Claims made about non-nutrient characteristics of food (for example 'pure', 'fresh' or 'natural') or process claims (for example 'pasteurised' or 'halal') are not regulated by the Code.

As a result, in Australia we now have a very clearly defined and regulated regime in relation to health and nutrition content claims. These can only be made if they are based on food-health relationships that have been substantiated according to the Standard. These are ranked as high level health claims (which refer to a nutrient or substance in food and its relationship to a serious disease or to a biomarker of a serious disease, for which only 13 pre-approved claims exist), and general health claims (which must only refer to the nutrient or substance in a food and its effect on a health function and must not refer to a serious disease, for which there are more than 200 pre-approved claims). Businesses may also self-substantiate a specific health claim to the satisfaction of FSANZ. Although this could extend to use of 'all-natural', for example, as part of a health claim, this has not yet occurred. These health and nutrition claims therefore are restrictively defined.

By comparison, use of 'natural' has not been strictly defined. Use of the term 'natural' in food labelling must be regulated by the Australian Consumer Laws which is administered by the ACCC. This requires that labels are not false, misleading or deceptive. This is a negative test. Consumers, manufacturers and retailers alike are left without a guide as to what the use of the term 'natural' actually requires. The ACCC have issued some general guidelines in relation to the use of certain food descriptors, including use of the term 'natural', pointing to ordinary dictionary meanings. The ACCC has noted by way of guidance that "consumers may view what is 'natural' differently to manufacturers and food technologists' and consequently, when using the term, 'thought should be given to what the consumer would think'.

However ultimately the ability to make any such claims (or to be stopped from doing so) must be assessed on a case by case basis.

So what do food manufacturers and retailers in Australia need to take from the US review?

Australian manufacturers and retailers should watch the FDA decision with interest. This is because if, and then how, the term 'natural' and its use is defined in the US, will increase the guidance on appropriate use in Australia.

In addition, FSANZ has looked to overseas governing bodies, including in the US, to develop the Australian Code and Standards. Therefore, if there was a combined call for further action from consumers and regulators to codify use of 'natural', it is possible that regulators will look to introduce clearer guidelines or even codes, to regulate wider food labelling terminology beyond the nutrition, health and related claims that are currently codified under FSANZ.

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Georgina Hey
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