Food Regulatory Update: Bioengineered Disclosure Coming to a Food Label Near You; Menu Labeling Rule Goes Live Today, May 7th – Are You in Compliance?

by Saul Ewing Arnstein & Lehr LLP

On May 4, 2018, the U.S. Department of Agriculture’s (USDA) Agricultural Marketing Service (AMS) published in the Federal Register a proposed rule that, if finalized, will provide a mandatory uniform national standard for disclosure of information to consumers about the bioengineered (BE) status of foods.  More specifically, the proposed rule would require food manufacturers and other entities that label foods for retail sale to disclose information about BE food and BE food ingredient content.  Under the proposed rule, regulated entities would have three choices for BE disclosure: (1) food package text disclosure; (2) food package symbol disclosure; or (3) electronic or digital link disclosure.  The proposed BE symbols being considered are available here.  While AMS uses the phrase bioengineered food, some in industry and certain media outlets refer to BE food as genetically engineered, genetically modified, or containing genetically modified organisms (GMOs).

By way of background, on July 29, 2016, Public Law 114-216 amended the Agricultural Marketing Act of 1946 (7 U.S.C. § 1621 et seq.), as amended (amended Act), by adding Subtitles E and F.  Subtitle E of the amended Act directs USDA to establish the National Bioengineered Food Disclosure Standard (NBFDS) for disclosing any BE food and any food that may be BE.  Subtitle E also directs USDA to establish requirements and procedures necessary to carry out the new standard.  Importantly, Subtitle F addresses Federal preemption of State and local genetic engineering labeling requirements, and also specifies that certification of food under USDA’s National Organic Program (NOP) (7 C.F.R. Part 205) shall be considered sufficient to make claims about the absence of bioengineering in the food.

Scope of the Proposed Rule

The proposed rule, if finalized, would generally apply to food that is intended for human consumption.  However, the amended Act includes two express exemptions to the BE disclosure requirement, which the proposed rule incorporates: food served in a restaurant or similar retail food establishment and food produced by very small food manufacturers (i.e., those with annual receipts of less than $2,500,000).  The amended Act also prohibits a food derived from an animal to be considered a BE food solely because the animal consumed feed produced from, containing, or consisting of a BE substance.

Bioengineering, BE Foods, and Disclosure Threshold

The amended Act defines "bioengineering" with respect to a food as referring to a food:

a.    that contains genetic material that has been modified through in vitro recombinant deoxyribonucleic acid (DNA) techniques; and
b.    for which the modification could not otherwise be obtained through conventional breeding or found in nature.

7 U.S.C. § 1639(1).

AMS is proposing to directly incorporate this statutory definition into the definition of "bioengineered food" without further interpretation of what "bioengineering" means, thus punting one of the more controversial aspects of the proposed rule.

With regard to the amounts of a BE substance that may be present in food in order for the food to be a BE food, AMS is considering three alternative proposals:

  1. The first proposed alternative would establish that food in which an ingredient contains a BE substance that is inadvertent or technically unavoidable, and accounts for no more than five percent (5%) of the specific ingredient by weight, would not be subject to disclosure as a result of that one ingredient.  Any other use of a food or food ingredient that contained a BE substance would be subject to disclosure.
  2. The second alternative proposal would establish that food, in which an ingredient contains a BE substance that is inadvertent or technically unavoidable, and accounts for no more than nine-tenths percent (0.9%) of the specific ingredient by weight, would not be subject to disclosure as a result of that one ingredient.
  3. The third alternative proposal would establish that regulated entities could use a small amount of BE ingredients up to a certain threshold, such as five percent (5%) of the total weight of the product, without being required to include a BE disclosure on a product label

Proposed Effective and Initial Compliance Dates

Any final rule resulting from the proposed rule would become effective 60 days after the date of the final rule's publication in the Federal Register, with a compliance date of January 1, 2020, and with a delayed compliance date of January 1, 2021 for small food manufacturers.  The proposed compliance date of January 1, 2020 is intended to align with the U.S. Food and Drug Administration’s (FDA or the Agency) final rule to extend the compliance dates for the changes to the Nutrition Facts and Supplement Facts label final rule and the Serving Size final rule from July 26, 2018 to January 1, 2020 for manufacturers with $10 million or more in annual food sales.

Submitting Comments on the Proposed Rule

The deadline to submit comments on the proposed rule is July 3, 2018.  Due to the congressionally-mandated timeline for the rulemaking, it is unlikely that AMS will extend the comment period, so it is important that interested parties file comments in a timely manner.  If you would like to submit comments on the proposed rule – which would pose significant compliance challenges and require considerable financial commitment – please contact the author or the attorney at the firm with whom you are regularly in contact.  Participating in the docket is important, not only to ensure that AMS is aware of industry feedback and concerns, but also, to potentially preserve a legal challenge to the final rule (if any).  Given the Supreme Court’s 2000 ruling in Sims v. Apfel regarding issue exhausting (i.e., raising an issue with a government agency before raising it in litigation), and some case law requiring issue exhaustion in notice-and-comment rulemaking (e.g., the D.C. Circuit’s 2005 decision in Advocates for Highway and Auto Safety v. Fed. Motor Carrier Safety Admin.), parties affected by the BE food rule should consider submitting comments to AMS if there is a chance they plan to later challenge the rule in court.

Menu Labeling Rule Now Live – Are You in Compliance?

After repeated delays, litigation, and attempted congressional intervention, FDA’s Menu Labeling Rule is now live.  By way of background, the Agency’s Menu Labeling Rule (discussed here) requires restaurants and "similar retail food establishments" (e.g., convenience stores and grocery stores) that are part of a chain of 20 or more locations and that sell similar menu items to post on menus and menu boards: (1) calorie information; (2) a statement on suggested daily caloric intake; and (3) a statement that written nutrition information is available upon request (and provide such information upon request).

Despite the Agency issuing multiple guidance documents on the topic, including its Supplemental Guidance for Industry, released today, there are still many unanswered questions and the burdens on industry to comply with the Rule’s highly nuanced requirements remain.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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