RPC Bites #23 - Northern Ireland Protocol breakthrough, victory for the UK organics sector and eco faux pas for Gousto

17 December 2020. Published by Ciara Cullen, Partner and Ben Mark, Partner

Welcome to RPC Bites. Our aim in the next 2 minutes is to provide you with a flavour of some key legal, regulatory and commercial developments in the Food & Drink sector over the last fortnight… with the occasional bit of industry gossip thrown in for good measure. Enjoy!!

Access the full edition of RPC Bites here.

Northern Ireland Protocol breakthrough  

On 8 December 2020, Michael Gove confirmed (via Twitter) that the UK had reached an agreement with the EU, which resolves outstanding issues on the implementation of the Withdrawal Agreement as it relates to Ireland and Northern Ireland (NI) and the Good Friday Agreement. 

Whilst the final text is yet to be confirmed, the updated NI Protocol Command Paper and Draft Decisions of the Joint Committee are available here.

In summary: 

  • Tariffs will be payable on goods moved from Great Britain (GB) to NI if they are considered 'at risk' of subsequently being moved into the EEA;
  • However, food products imported to NI by an 'authorised' trader for the sole purpose of the sale of food to an end-consumer (e.g. in NI supermarkets) are not considered 'at risk' and not therefore subject to tariffs;
  •  Businesses that meet the NI establishment criteria and which undertake to bring goods into NI solely for the sale to, or use by, end-consumers can apply for 'authorised' trader status;
  • Goods originating in NI will not be subject to tariffs when imported into GB;
  • 'Authorised' traders will benefit from a 3 month ‘grace period’ to comply with certification requirements for products of animal origin, composite products and plant products and / or a 6 month 'grace period' for chilled meats; and
  • Under the 'Movement Assistance Scheme' for agri-food traders who will need to comply with SPS checks (such as Export Health Certificates), there are assurances that "the UK Government will take care of reasonable costs".

With such a short period of time now left until the transition period expires, food and drink businesses selling products in NI should prioritise registering with the Trader Support Service and the Movement Assistance Scheme (if relevant), to the extent that they have not done so already. Businesses should also consider their eligibility for 'authorised' trader status and make applications. Read more

Victory for the UK organics sector

The organic sector can breathe a sigh of relief (for now) as the EU Commission has confirmed that the EU will recognise the UK's six organic certification bodies, for 12 months after the Brexit transition period expires on 31 December 2020. This is a crucial result for the sector, which exports an estimated £225 million worth of organic produce to the EU each year. 

Whilst not the full mutual equivalency that UK producers had been hoping for, the decision certainly provides some comfort in the short-term, allowing the UK sector to continue to enjoy access for another year. In the absence of recognition, the sector risked losing its status in the EU and Northern Ireland – two of its most important markets.

Businesses so far reluctant to set the wheels in motion for the new labelling requirements for organic products exported to the EU can now do so (whilst not forgetting other EU labelling requirements – see Issue 18!) However, this isn't the end of Brexit uncertainty for the organic sector: It remains to be seen whether a deal can be reached on full mutual equivalency beyond 2021. Read more

Eco faux pas for Gousto

Meal kit subscription service, Gousto, has been reprimanded by the Advertising Standards Authority (ASA) for the marketing of its Eco Chill Box. Gousto described the Eco Chill Box as "100% plastic-free" and "100% recyclable" on its website blog. However, rival recipe box service, Hello Fresh, challenged the claims, identifying them as misleading and unsubstantiated due to the low-density polyethylene plastic ice pack included in the Eco Chill Box, which can only be recycled at specific local authority facilities.

Gousto meanwhile argued that the claims were not misleading as the Eco Chill Box and the ice packs within it were discrete and therefore the composition and recyclability of the ice packs was irrelevant. The Eco Chill Box in and of itself was "100% plastic-free" and "100% recyclable" as described. 

The ASA disagreed with Gousto's explanations, ruling that the ad breached the CAP Code rules on misleading advertising, substantiation and environmental claims. The ASA took the view that consumers would interpret the Eco Chill Box as including its components, especially those which necessitate the cooling function of the box. As a result, Gousto's ads have been amended to remove the offending claims and to explain exactly how the Eco Chill Box (plastic ice pack included) can be recycled. 

Concern around 'greenwashing' is a hot topic for regulators, with the Competition and Markets Authority (CMA) launching an investigation into whether unsubstantiated claims are misleading (see our article on the topic here). In September 2020, the ASA issued another ruling on environmental claims, upholding complaints against carbon footprint claims used in an advert for Quorn Thai Wondergreens (see Issue 18 of RPC Bites). Read more

Something to wine about? EU introduces mandatory calorie labelling on wine

In August 2020, as part of its strategy to combat obesity, the UK Government announced its intention to consult on plans to provide calorie labelling on alcohol before the end of 2020 (reported in Issue 14). The Government now appears unlikely to meet this deadline.

However, in the meantime the European Parliament and Council of Ministers have voted to approve an amendment to the Common Agricultural Policy (CAP), requiring kilocalories to be displayed on all wine packaging. Whilst the implementation date is yet to be confirmed, this will mean that UK wine producers will have to include kcals on their labelling, if they wish to export their products to the EU and / or NI. Commercial decisions will therefore need to be made regarding the cost of utilising different labelling for the UK and EU markets.

Interestingly, the amendment to the CAP only covers wine. None of the reports on the UK Government's proposed consultation on alcohol labelling suggested that the scope would be so narrow.  

We will provide updates on any UK consultations on alcohol labelling in future issues of RPC Bites. Read more

Californian company receives regulatory approval for lab-grown meat

The race to produce the world's first commercially available cultured meat products has thrust Californian company Eat Just, Inc into the spotlight. Cultured meat is more commonly known as 'lab-grown meat' and refers to the cultivation of animal cells in-vitro. 

The Singaporean Food Agency has recently approved the sale of Eat Just's chicken bites, which contain cultured chicken. The product will be sold in a single restaurant at a much higher price than typical chicken, but companies worldwide will be monitoring public reaction given that over two years of testing, funding and review has gone into its development (see Issue 15 for details of KFC's collaboration on 3D printed chicken nuggets). 

Health benefits, sustainability and animal welfare have all been cited as marketing draws for cultivated products. Whilst at this stage, the production process uses a significant amount of energy, Eat Just expects this to improve once production is scaled up. Read more

Government guidance makes scotch eggs the star of the show

As the UK adjusts to the new tier system, which permits restaurants, pubs and bars to re-open in tier 1 and 2 areas, debate has erupted over what is meant by the term 'substantial meal'. Pubs in tier 2 areas cannot sell alcoholic drinks, unless they are served as part of a 'substantial meal'. 

Enterprising pubs have sought to maximise business after George Eustice's comments on the once unassuming scotch egg. On 30 November 2020, the Minister for Environment, Food and Rural Affairs told LBC radio that scotch eggs would be considered a 'substantial meal' for the purpose of serving alcohol in tier 2 areas.  

Manufacturers of scotch eggs have since seen sales soar, as have supermarkets. For pubs that do not offer restaurant services, the Minister seems to have offered a (much-welcomed) method of providing drinks to customers, whilst complying with local restrictions. Read more

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