4 August 202311 minute read

Food and Beverage News and Trends - August 4, 2023

This regular publication by DLA Piper lawyers focuses on helping clients navigate the ever-changing business, legal and regulatory landscape.

Government of Canada announces plans to create vaccine bank for foot and mouth disease in animals. The Federal, Provincial, and Territorial Ministers of Agriculture have jointly committed to establish a Foot-and-Mouth Disease (FMD) Vaccine Bank to combat Canadian outbreaks of this highly contagious virus. FMD strikes cows, pigs, sheep, goats, and other animals with divided hooves; it causes enormous production losses and hardships for farmers and ranchers and has serious economic impacts: even detecting a single case can halt a country’s international trade in livestock. An FMD outbreak could cost the Canadian economy an estimated $19.4 billion to $65.2 billion. Canada’s 2023 budget has committed $57.5 million over five years to the FMD Vaccine Bank, with $5.6 million to the Canadian Food Inspection Agency to establish the vaccine bank and to develop FMD response plans. Canada currently has access to the North American Foot and Mouth Disease Vaccine Bank; the dedicated Canadian vaccine bank will expand Canada’s prevention and mitigation sources and increase the number of readily available vaccines for Canadian producers. Canada has been FMD free in animals since 1952 and the US has been FMD free since 1929.

FDA again refuses to ban phthalates in food-contact applications. On July 21, the FDA denied a citizen petition filed by Earthjustice to ban eight specific ortho-phthalates from being used in contact with food. Phthalates, often called plasticizers, are frequently used in food packaging, as well as in products like shampoos and vinyl flooring. Research has linked phthalate exposure to a host of concerns, among them attention-deficit hyperactivity disorder, breast cancer, infertility, obesity, altered reproductive development, and male fertility issues. In 2022, the FDA considered a petition to ban phthalates in food-contact applications, but rejected it. The agency said in its current announcement that it had evaluated the petition for reconsideration of its earlier refusal to ban phthalates and that it has “concluded that it does not provide a basis for modifying the FDA’s response to the original citizen petition.”

CFIA launches consultation on origin labelling of foods imported from a contested territory. The Canadian Food Inspection Agency (CFIA) is seeking consumer feedback on how to label the origin of imported food from a contested territory. A contested territory is defined as an area outside Canada subject to competing claims of control by third parties. All food sold in Canada must be labelled in a manner that is not false or misleading, pursuant to subsection 5(1) of the Food and Drug Act. The CFIA is launching a consultation to clarify whether having the origin label display the geographic region or territory where a food was produced would be in compliance with Canadian labelling regulations.

FDA enters into key agreement with Indonesia about imported shrimp. On July 10, the FDA took a major step to help ensure the safety of shrimp sold in the United States, signing a confidentiality commitment with the Fish Quarantine and Inspection Agency of the Ministry of Marine Affairs and Fisheries of the Republic of Indonesia. The commitment, which will allow the exchange of confidential information, including inspection records, sample findings, and other nonpublic documents, is being seen as an important step to prepare Indonesia for participation in a three-country pilot program designed to ensure the safety of shrimp exported to the United States. Congress recently mandated that FDA develop and implement options for regulating shrimp imports, including imports from the three largest exporting countries by volume over the previous three calendar years. Currently, these countries are India, Indonesia, and Ecuador.

Nutrition experts provide input to FDA on front-of-pack label testing. On July 17, several nutrition authorities and major food-advocacy groups, among them the American Heart Association and the Center for Science in the Public Interest, sent a letter to the FDA urging it to take additional steps in its attempt to consumer-test front-of-pack food labels. The groups, for example, urged the agency to use an exclamation point icon or to use the term “ATTENTION!” in order to attract the interest of food purchasers. “These attention-grabbing features would contribute toward the study’s goals of identifying a scheme that allows consumers to quickly evaluate the healthfulness of products,” the groups said. They noted that their understanding is that the FDA is not considering proposing a warning label or a warning icon in its labeling proposals.

Update to the Safe Foods for Canadians licensing guidance. The Canadian Food Inspection Agency (CFIA) has updated the guidance relating to amending a Safe Foods for Canadians (SFC) license when there is a change in activities, food commodities, or establishments. If an SFC licence holder intends to conduct activities with respect to a food commodity that has not been entered in its application, that new food commodity must be added to the scope of the license. To amend the license, all relevant Safe Foods for Canadian Regulation (SFCR) requirements must be met. In addition, the license holder must have a written preventative control plan that is updated to reflect these changes, and the license holder must comply with record-keeping requirements. The update provides additional information regarding requirements for a licence holder when selling their business or if there is a change in business structure. Annex A was also updated with examples for sub-commodities under manufactured foods, to assist the license applicant in the correct selection of food commodity and sub-commodity for their business.

Minister of Health: Notice of Intent to permit vitamin D fortification of yogurt and kefir and to expand the dairy-related FOP label exemption. The Minister of Health has published a Notice of Intent to inform regulated parties and other stakeholders of the proposal to permit vitamin D fortification of yogurt and kefir (a fermented milk drink) and to expand the eligibility for the dairy-related exemption from the front-of-package (FOP) nutrition labelling requirement by lowering the calcium threshold. According to blood status data from the latest Canadian Health Measures Survey (2012-2019), 20 percent of Canadians are not getting enough vitamin D. Health Canada amended the Food and Drug Regulations in 2012 to increase the amount of vitamin D required in milk and margarine, but it has also been determined that additional food sources of vitamin D are needed. Dietary intake modelling of the impact of adding vitamin D to yogurt and kefir found vitamin D intakes improved, without posing a risk of excess consumption of the vitamin.

In addition, Canada requires FOP nutrition symbol labelling for prepackaged products containing nutrients of public health concern (eg, saturated fat) at or above specified thresholds. Many dairy products are significant contributors of saturated fat and sodium; however, they are also important sources of calcium. To mitigate the concern that FOP nutrition labelling could negatively impact calcium intakes, the regulations include an exemption for cheese or yogurt. The types of foods eligible for the exemption remain the same as those currently set out in the Food and Drug Regulations and apply to prepackaged cheeses or yogurts made from dairy products, kefir, or buttermilk. With the new lower calcium threshold, however, a greater number of products will be exempt.

Comments on these proposals may be provided by email or in written format to Health Canada’s Bureau of Nutritional Sciences until August 28, 2023.

FDA on sesame labeling issue. On July 26, the FDA largely denied a petition filed by the nonprofit Center for Science in the Public Interest which had asked the agency to take a strong stand against companies that may be intentionally adding sesame to their products to comply with a new FDA allergen labeling requirement. “We are aware that some manufacturers are intentionally adding sesame to products that previously did not contain sesame and might be doing so for reasons related to allergen cross-contact controls,” the agency wrote. “Although FDA does not encourage the addition of sesame as an ingredient to a food when sesame is not normally an ingredient used to make the food, a company’s decision to add sesame and then declare it on the label as required is not violative.”

Bill C-280, Canada’s Financial Protection for Fresh Fruit and Vegetable Farmers Act, moves ahead. Bill C-280, the Financial Protection for Fresh Fruit and Vegetable Farmers Act, has passed the second of three readings in the House of Commons. Bill C-280 would amend the Bankruptcy and Insolvency Act as well as the Companies’ Creditors Arrangement Act to establish a deemed trust mechanism for fresh produce sellers. This would secure payment for sellers in the event that a purchaser of perishable products becomes bankrupt, is subject to a receivership, or otherwise applies to the court for approval of a compromise or an arrangement. Farmers usually do not collect payment until the products are sold farther down the supply chain; the bill addresses a number of economic risks farmers regularly face in growing, harvesting, packing, and marketing fresh fruits and vegetables. The perishable nature of fresh produce as well as the industry’s typically longer payment terms can leave sellers unable to recover losses when faced with buyer bankruptcy. The Bill is modeled on the US Perishable Agricultural Commodities Act (PACA), providing that perishable fruits and vegetables, as well as the proceeds of that sale, are to be held in trust by the purchaser for the supplier. The Fruit and Vegetable Dispute Resolution Corporation has also stated that the financial protections established by the Bill may “open the door” to the reinstatement of preferential treatment under PACA for Canadians selling produce into the United States. Preferential treatment had been in place prior to 2014, when it was rescinded by the US due to a lack of reciprocal protection in Canada.

Court rejects claim concerning prep time of macaroni and cheese. On July 27, the US Court for the Southern District of Florida dismissed a proposed class action that had alleged that Kraft Heinz & Co. is misleading consumers by promising on the package that the preparation time for a cup of microwavable Velveeta macaroni and cheese is only 3 ½ minutes. The court said that the plaintiff, consumer Amanda Ramirez, lacked standing to pursue the case or to force Kraft Heinz to change its packaging. Ramirez had said that the packaging, which noted that the macaroni and cheese would be “ready in 3 ½ minutes,” did not include the time needed to remove the lid, add water, and stir in a cheese sauce pouch. But the judge ruled that Ramirez had never alleged that she could not eat the Velveeta Shells & Cheese she bought, or that she had even tried to cook the product, or that it was “so flawed as to be rendered useless.”

Study says it may be preferable not to label meat-free menu offerings as vegetarian or vegan. A study conducted at the Massachusetts Institute of Technology and published in the journal Appetite concludes that vegetarian and vegan labels on menu foods probably do more harm than good in terms of consumer sales. The study concluded that meat eaters are significantly less likely to choose food items when they are presented as vegan or vegetarian. When meatless menu foods were not labeled vegan or vegetarian, about 10 percent more test subjects opted for a meatless meal. Further, the study found that when such labels are absent from menus, vegans and vegetarians will not accidentally pick food options containing meat. “Our studies find that vegetarians and vegan labels effectively deter consumers from choosing these options,” the researchers said. The experiment “suggests these labels should be removed from menus to normalize and encourage vegetarian and vegan eating.” According to the researchers, this could serve as an “extremely simple and low-cost means for restaurants and other institutions to reduce their environmental impact, with minimal changes to menus, and without impacting consumers’ freedom of choice.”

Ultra-processed foods and diabetics. A new study suggests that for people with Type 2 diabetes, the negative effects of a diet rich in ultra-processed foods may outweigh the benefits of following a Mediterranean diet. Ultra-processed foods are products that have been heavily processed and contain significant amounts of sodium, added sugar, and saturated fats as well as chemical additives. The study, conducted in Pozzilli, Italy, found that diabetics who ate high amounts of ultra-processed foods had a higher risk of death from any cause, and specifically from cardiovascular disease, compared with those who ate the smallest amount of ultra-processed foods – regardless of overall diet quality. Previous studies have shown that the consumption of ultra-processed foods may lead to Type 2 diabetes, but no study had looked at the effect of such foods on people who already have the disease. Those with Type 2 diabetes, the study concluded, should not only consider the sugar, fat, and fiber in their food, but should reduce or cut out ultra-processed foods. The study, “Ultraprocessed food consumption is associated with all-cause and cardiovascular mortality in participants with type 2 diabetes independent of diet quality,” appeared in the American Journal of Clinical Nutrition on July 26.