Food & Drink update – November 2015Print publication
Richard Naish of the Walker Morris Food & Drink Group presents a round-up of some recent legal developments in the sector.
Sentencing Council Guidelines
The Sentencing Council published its Guidelines for “Health and safety offences, corporate manslaughter and food safety and hygiene offences” on 3 November. The Guidelines will come into effect on 1 February 2016 and will apply to any case heard on or after that date, regardless of when the offence occurred.
The Guidelines are virtually certain to mean higher fines for companies in the sector that are found guilty of food safety offences and, in the case of larger companies, the fines could be very high indeed. The Guidelines also increase the likelihood of custodial sentences for individuals (and for longer terms).
The Guidelines apply to a wide range of food safety offences, including putting unsafe food on the market, inadequate traceability, food recalls and withdrawals, failure to adopt systems based on Hazard Analysis Critical Control Point (HACCP) principles and misleading consumers through labelling, advertising and preparation of food.
The list of mitigating features does not now include evidence that the business or individual has effective food safety and hygiene procedures in place. If a business has failed to establish a due diligence defence, evidence of its systems and procedures will no longer be considered a mitigating feature.
The Guidelines can be accessed here.
The Department for Business, Innovation and Skills (the BIS) has reported on whether there is a case for giving businesses a right to seek civil injunctions against “copycat packaging”. Following its review, the BIS has concluded that there is little clear evidence that the use of similar packaging is causing any significant consumer detriment or hindering competition or innovation and that there would be risks in changing the status quo and granting civil injunction powers. The ministerial statement highlights the arguments that were put forward by brands and retailers in favour of and against the injunctions.
The Government has published its guidance on how to comply with the Modern Slavery Act (the Act). Annexe E, in particular, offers tips on how businesses should go about auditing their supply chain, carrying out due diligence and training staff. A company will fall within the scope of the Act’s reporting requirements if it satisfies two tests:
- a turnover test – does the turnover of the company amount to £36 million or more? This includes turnover of subsidiary undertakings, wherever those subsidiaries are located; and
- a jurisdiction test – the must “carry on business” (or part of its business) in the UK. It need not be incorporated in the UK. There is no de minimis exception, so that if the organisation carries on any part of its business, however small, in the UK it will be subject to the reporting requirement (subject to meeting the turnover threshold). An overseas parent company may be caught if it has subsidiaries incorporated in or trading in the UK but this will depend on the degree of independence the subsidiary has from the parent.
That modern slavery is a troubling issue for the sector is borne out by a report published in October by the Ethical Trading Initiative and the Ashbridge Centre for Business Sustainability at Hult International Business School, which found that 71 per cent of respondents to the survey (of brands and retailers) believed there was a likelihood of modern slavery occurring in their supply chains, particularly in high-risk sectors, such as fresh produce. The survey suggested that relationships with suppliers are not close enough to eradicate slavery in the supply chain and that the audits currently carried out are ineffective.
A ruling by the Advertising Standards Authority (ASA) in October is a reminder for Food and Drink businesses to take care with the language used in advertisements. The ASA upheld a complaint against Iceland Foods in respect of a range of frozen bake-off loaves that it was marketing as part of its Power of Frozen campaign. The ASA ruled that the claim “our stone baked bread is made from the best wheat, sourdough, water, salt and amount of yeast” in the context of the depiction of the baking process and which suggested the bread was homemade was likely to be understood to mean the stone baked products included only the ingredients referred to and, as such, was likely to be misleading as the bread contained additional ingredients. The ASA ordered that the advertisement should not be shown again.
Advertising to children
The Committee of Advertising Practice is embarking on a consultation concerning the adoption of new rules governing the non-broadcast advertising of foods high in fat, salt and sugar to children. The Committee is currently talking to key consumer, campaigning, public health and industry organisations and intends to launch a public consultation in the New Year.
The Food (Waste) Reduction Bill has received its first reading in the House of Commons. Its second reading is scheduled for late January next year. The Bill contains a number of quite draconian measures to tackle food waste, including requiring businesses to donate unsold food and to publish accounts of food waste created throughout the supply chain. The Bill also sets targets for the reduction of food waste. The Bill is a “10-minute bill” and, as such, is unlikely to become law, but “10-minute bills” often serve to keep the issue in the spotlight and may presage Government legislation later on.
EU protected food name status
Applications for EU protected food name status can be tracked on the DEFRA website but there have been a number of very recent applications, including for Welsh Cider, Conwy Mussels and London Cure Smoked Salmon. We have written previously on the benefits of Protected Food Name status.