New and Old Rules in Food Labelling & Marketing: How Many Laps Left?

Ready, set, go!
 
On December 17, 2013, former Chilean President Sebastián Piñera, along with his Education and Health Ministries, announced the publication of the Food Labelling Law (N° 20606 of 2012) Rules, which specified the applicability, administrative measures, deadlines to adapt the labels and packages to the regulations, and other general provisions to execute the Food Labelling Law (FLL), Law 20606. The latter was in force since July 2012, still lacking the Rules that were to make it 100% effective.
 
The President reminded the audience(1) about the main objectives of the aforementioned FLL: that all marketing and publicity of packaged food containing high sugar, salt or fat levels must include a “positive lifestyle message”, such as “healthy eating and exercise is good for your health”; that all of the aforementioned foods must be specifically labelled, displaying high contents of fat, sugar, calories, or fats; and finally, that all publicity or marketing directed to children must mention that these foods are “unhealthy”.
 
Other relevant provisions of the FLL, affected more or less by the said Rules, are the proportions of potentially hazardous substances; the selling, marketing and promotion of highly caloric foods, including its prohibition to be sold in schools; the prohibition of the marketing of these foods to children under 14, and any kind of marketing and sales hooks, such as toys and other prizes.
 
As explained, the Rules as published made the FLL applicable, establishing the standards to be complied with. The “positive message” was indeed “healthy eating and exercise is good for your health”, which must be added to labels and audiovisual marketing. The warning system consisted of a geometric colour pattern.
 
However, last April, the new administration of Michelle Bachellet, represented by the new Health Minister Helia Molina, decreed that the Rules would no longer be in force, in order to be thoroughly revised and modified. According to press versions, the Rules will be delayed until at least June, 2015(2). What had happened?
 
Stop! False start…
 
All along the political spectrum, the “obesity epidemic” is recognised as a serious public policy issue. When the FLL was introduced in Congress, in 2007, by a group of legislators (representing both of the two coalitions, left and right, that has alternated power in the last three presidencies), obesity was revealed to be as prevalent as 8% in children under 6 years of ages, and an unprecedented 17% among first graders. Other health concerns, such as diabetes, were also considered.
 
The consensus was to legislate, as the (then) administrative provisions for labelling and marketing contained in the Food Sanitary Rules were insufficient to deal with the obesity problem. After an over-extended discussion in both Cameras, the Law was finally passed in 2012. However, key aspects of the law, such as the colour alerts on labels, and the proportions and quantities of “potentially hazardous” substances were left to a set of Rules to be drafted by the Health Ministry, which must have been in force in the following year, that is, in July 2013.
 
Regardless of the delay, the Rules as published were criticised by some of its own creators. According to Senator Girardi(3), member of the coalition currently in power, and member of the commission that drafted the Law back in 2007, the Rules were “tailored for corporations (…). It only refers to industrialised foods, leaving out prepared and fast foods, which is aberrant”. Upon the announcement that a new set of rules was in the drafting, current Health Ministry’s consultant Enrique Accorsi stated that “the new Rules should be more strict and pedagogic regarding the warnings in the products, to facilitate the consumers’ understanding”.
 
As of May 2014, the new Rules draft has not been made public.
 
Distance to go
 
So what does the absence of Rules mean to the food industry? The current Law is still valid, though some of its provisions depend on the existence of valid Rules, such as:
 
a. The modifications needed to be made in the Food Sanitary Rules (general Rules for the food industry), including proportion, shape, size, colours, characteristics and contents of nutritional labels.
b. The concentrations and proportions of “potentially hazardous” substances in foods.
c. Which foods are to be considered high in calories, fats, sugars, salts or “other ingredients”, to be labelled as such. Also, the content, size, proportion, signs or drawings of the corresponding informative labels and warnings
d. The FLL estates that very marketing or publicity of foods in the media must bear a “message promoting healthy lifestyle” habits. The Rules are yet to determine exactly how this message will be advertised / scripted for printed and audiovisual marketing.
e. According to the FLL, very packaging or label of foods that contains soy, milk, peanuts, eggs, shellfish, fish, gluten or dried fruits must declare so; the Rules are yet to determine the characteristics of the said labels.
 
As current authorities have commented, the main reason for delaying the application of the Rules was that the “risk” nutrient levels for labelling a food product as “high” in fat, sugar, etc. were low when compared to actual standards; also, that the warning system was unclear and even confusing (to the consumers) on the actual nutritional value of some foods. The uncertainty that the Food Industry will fall into for the next 13 months may be counterweighted by a clearer set of Rules, which actually simplify the labelling and warning process for both the consumers and the producers. We will have to wait until the final lap to see.
 
Ariela Agosin is partner in at Albagli Zaliasnik, where she leads the Intellectual and Industrial Property group, along with Rodrigo Albagli. Between 2005 and 2010, she led the Miami Office. Likewise, during that time she was member of the board at the Chile-US Chamber of Commerce, based in that city. Her professional development has focused on international law, civil and commercial litigation, antitrust, unfair competition, advertising law, industrial and intellectual property, including trademarks, patents, copyrights, information technology, licensing, as well as litigation related to those practice areas and brand protection in general. She is currently (2014) the elected Regional President (Americas) for GALA, the Global Advertising Lawyers Alliance