The coverage of the new rules is wide and will impact traditional fast food chains as well as café and coffee chains, bakeries, juice bars, and ice cream shops.
New legislation in NSWNew South Wales is the first to put the scheme into place, with the commencement of the Food Amendment Act 2010 (the Act) on 1 February 2011. The Act allows a 12 month implementation period so that heavy fines will kick in from 1 February 2012 for outlets in breach of the Act.
The new rules will apply to every 'standard food outlet' which is part of a chain with more than 20 outlets in New South Wales or more than 50 outlets throughout Australia and which sells standard food items. A 'standard food item' is an item of ready-to-eat food for sale that is sold in servings that are standardised for portion and content and which is:
1. listed or otherwise shown on a menu, or
2. displayed for sale with a price tag or label or an identifying tag or label, and
3. not pre-packaged.
The new laws will encompass all such businesses in the chain whether they are company owned or franchised, provided they operate under the same trading name.The Act requires affected food businesses to:
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legibly disclose the kilojoule content of each standard food item on all of their menus (including all electronic or printed menus on boards, posters, leaflets whether at the premises or otherwise available outside the premises such as on websites);
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legibly display the reference statement ‘The average adult daily energy intake is 8,700kJ’ on each menu board, display cabinet and printed menu; and
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place the above kilojoule information adjacent or close proximity to the name/price of the item and ensure that the information is at least the same font and size as the price of the item on the menu.
Categories of businesses exempted from the Act are convenience stores, service stations, catering businesses, restaurants with no takeaway services and retail food sold at health care facilities.
Supermarkets, cinemas and other businesses are affected to the extent they fall within the definition and sell standard food items.
What the new rules mean for youChains with outlets in New South Wales caught by the Act will need to prepare well in advance for the commencement of the new regulations on 1 February 2012.
Due to the significant time that is required for the design, manufacture and installation of new menu boards as well as implementing changes to all other forms of menus, websites and advertising and promotional material, the process will need to start as soon as possible in order to ensure that all outlets in New South Wales are compliant by February 2012.
Businesses that are expecting to increase their numbers to more than 20 stores in New South Wales or more than 50 stores nationwide by 2012 should consider changing their menus now. This will avoid the cost of redesigning all the menus later on down the track when the requisite numbers are reached.
For franchise systems, changes to fitout and signage must also be documented and updated in the Operations Manuals and the costs involved included in the disclosure document.
FAQs
The following sets of Q & A are informative of the implications of the Act.
The franchisee is responsible. Under the Act it is the “proprietor” of the food outlet that must ensure the display of the nutritional information in the prescribed manner and locations.
Q: Does the kilojoule information need to be displayed for food that is added to a standard food item for an additional price?
Only if the added food is a ‘standard food item’. This means any item of ready-to-eat food that is sold in servings that are standardised for portion and content and that is listed on a menu or displayed for sale with a price tag or label.
For example, if hot chips are added to a standard meal deal, then the kilojoule information is required to be displayed for the chips. However, extra cheese and sauces are only ingredients and are not ‘ready-to-eat’ food.
Q: How should the nutritional information be given for meal deals?
Under the Act, if a number of standard food items are shown for sale as a combination, the combination is to be treated as a single standard food item. Therefore for a meal deal (e.g. chips, burger and a drink), the total number of kilojoules for the whole meal should be displayed.
Meal deals sold in different sizes must be treated as separate standard food items. This means that the total number of kilojoules for each size must be displayed.
Where the customer significantly customises the meal deal (e.g. swaps chips for a salad), the meal need not be labelled as a whole. However each individual item must be labelled with the average kilojoule content to enable the customer to determine the total content of their order once the meal has been customised.
Q: What if the standard food item is not sold as a whole but in multiple servings?
Where the standard food item is intended for multiple servings (e.g. pizzas and large cakes), the business may disclose the suggested serving size in addition to the kilojoule content of the whole item.
Q: Are bakery products caught by the Act?
A whole loaf of bread or plain bread rolls are not caught under the Act as they usually require some further preparation prior to consumption. Filled or dressed rolls (e.g. cheese and bacon rolls or pizza rolls) are considered ready-to-eat food and must therefore comply.
Q: Are cake products caught by the Act?
Yes, whole cakes, whether baked on the premises or not, are required to comply. However cakes that arrive instore pre-packaged for sale or have a Nutrition Information Panel on them are not required to comply. Cakes that have ingredients changed as ordered by customers are not considered a standard food item and need not comply.
Q: Does the new Act apply to drinks?
The definition of a ‘standard food item’ under the Act does not expressly include drinks. However under the Australian New Zealand FoodStandards Code, it is implicit that food includes drinks. Therefore drinks which are prepared on the premises such as milkshakes will be caught under the Act.
Q: If my food outlet is not required to comply, can I voluntarily display the information?
Yes. However the information displayed must comply with the requirements outlined in the Act. Penalties apply for outlets that voluntarily display this information that does not comply with the requirements for food labelling.
SA and VIC not far behind – other States soon?
South Australia and Victoria are not far behind in implementing the scheme. New regulations under South Australia’s Food Act 2001 will be introduced in January 2012. Victoria will also mandate the display of kilojoule information by 2012, however the coverage will be narrower than the New South Wales Act as only businesses with 50 or more outlets in the State or 200 nationwide will be caught.
The new laws are one of the recommendations of the Review of Food Labelling Law and Policy (the Blewett Review) which was commissioned by COAG and the Australia and New Zealand Food Regulation Ministerial Council in 2009 and which handed down its final report in January this year. Accordingly it can reasonably be expected that similar legislation and perhaps more recommendations from the Blewett Review will be picked up by the other States and perhaps the Commonwealth.
Further, members of the Federal Government’s Food and Health Dialogue met last month to discuss the prospect of a national scheme. Members of the dialogue (which include various government, industry and public health groups) noted the work being undertaken through the Ministerial Council on the provision of point of sale nutrition information and will soon give their view on how best to promote national consistency in the roll out of any point of sale scheme.
Alignment with Overseas
The mandatory menu labelling scheme adopted here closely mirrors the new laws in the US which require restaurant chains, retail food establishments and vending machine operators with 20 or more locations to provide calorie information on menus and vending machines. This scheme commenced on 1 April 2011 and is part of the healthcare legislation introduced by President Barack Obama. It is based on a policy adopted by New York in 2006, and by California and Philadelphia in 2007.
Where to From Here?
Franchisees and franchisors as well as other proprietors of the food outlets caught by the current scheme should expect to incur significant costs in complying with the new regulations (and any future requirements) to develop kilojoule counts for all menu items and changing menu boards during the coming year.
Written by Corinne Attard, Special Counsel & Fiona Young, Solicitor.
For further information please contact:
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Tony Garrisson
Partner | Melbourne P +61 3 8644 3542
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Elisabeth Ritchie
Partner | Sydney P +61 2 9334 8649
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Peter van Rompaey
Partner | Melbourne P +61 3 8644 3506
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