Friday, 29 September 2017

Guidelines on food products of dual quality published (though mainly on the UCPD)

Remember Jean-Claude Juncker's State of the Union address? Not too many probably recall that it also referred to some consumer issues, which, admittedly, are less captivating than broad institutional reforms. One of the consumer topics which made its way to the speech and has also attracted a fair deal of media attention is the apparent divergence in the quality of some products sold under the same brand in different Member States. The issue appears to particularly affect the CEE food markets, where prices are also comparably lower. Earlier this week, the Commission published a Notice on the application of EU food and consumer protection law to issues of dual quality of products in the food sector. The notice contains guidelines aimed to help national authorities in their assessment, carried out on a case-by-case basis, whether marketing and sale of double quality products is in line with EU law. 

Here are the main take-aways:
  • Business operators are generally free to market and sell goods with different composition or characteristics in different countries - also under the same brand. The problem arises when  the marketing of identically branded goods of different quality is liable to mislead consumers.
  • The notice theoretically covers three acts - General Food Law Regulation No 178/2002, Food Information Regulation No 1169/2011 and Unfair Commercial Practices Directive 2005/29/EC - but in fact only elaborates on the latter. This is somewhat perplexing given that Food Information Regulation provides not only for a set of information duties, but also for a general principle according to which food information must not be misleading. Further notice on this particular act is expected to follow shortly.
  • To give it credit, the Commission attempts to explain the interplay of the UCPD with food law to some extent. It cites the lex specialis principle set out in Article 3(4) of the UCPD, according to which in the case of conflict between the Directive and other EU rules regulating specific aspects of unfair commercial practices, the latter shall prevail and apply to those specific aspects. It further recalls that information required by sector-specific law in relation to commercial communications is considered "material" under the UCPD. This, of course, also applies to the information requirements set out in the Food Information Regulation. The omission of this information is thus considered misleading to the extent that it is likely to affect the transactional decision of the average consumer (e.g. cause him or her to buy a product that he or she would not have bought otherwise). The interplay of the UCPD with Article 7(1) of Food Information Regulation is not clarified, though.
  • The notice goes on to explain that also where all required information particulars are provided, the marketing of goods with the same packaging and branding but with different composition and sensory profile can be contrary to the Directive. This can be the case when it is demonstrated that:
    • consumers have legitimate specific expectations from a product compared to a "product of reference" and the product significantly deviates from these expectations;
    • the trader omits or fails to convey adequate information to consumers and they cannot understand that a difference with their expectations may exist;
    • this inadequate or insufficient information is likely to distort the economic behaviour of the average consumer.
  • Overall, the relevant assessment can be summarised as follows:
    Flowchart included in the Commission Notice
  • Competent authorities (i.e. national authorities responsible for food law and for consumer protection, if they are separated, as well as competent authorities from different Member States) should cooperate with each other. As regards cross-border cooperation, enforcement efforts should be coordinated under the CPC framework (pursuant to Regulation No 2004/2006, currently under review).
  • Parallel EU-level actions include: 1) dialogue with the industry, consumer organisations and national authorities, 2) exploring possibilities of improving transparency and clarity of the exact content of food products (with a code of conduct for producers as one of envisaged options) and 3) developing guidelines for a common testing methodology to gather evidence and facilitate the assessment of particular cases.
Let's see whether this set of measures will ensure that Slovaks get more "fish in their fish fingers", Hungarians more "meat in their meals", and Czechs more "cacao in their chocolate". Or at least more transparency on each of those vital matters!

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