Advertising Compliance and Food Packaging

Food packaging’s advertising claims are designed to entice consumers to buy their products and drive sales. As there is a direct correlation between consumer preferences and sales figures, companies are constantly modifying their advertising claims in an attempt to satisfy evolving consumer trends. For example, the recent social trend towards living a healthy, active and balanced lifestyle has led to the emergence of health advertising claims. Such claims are engineered to inform consumers of the superior health benefits and components of one product over another. You may have noticed catchphrases on your food packaging, such as ‘low fat’, ‘sugar-free’, ‘low in salt’, ‘healthy’ and ‘low calories’. Businesses are entitled to make health claims in their advertising – provided they comply with Commonwealth and state Food Standards legislation, the claims are true and can be substantiated by evidence.

Food Standards Legislation

The Food Standards Australia New Zealand Act 1991 (Cth) contains the Australia and New Zealand Food Standards Code (‘the Code’) and governs food packaging and labels. Relevant state legislation also applies, such as the Food Act 2003 (NSW) and the Competition and Consumer Act 2010 (Cth) (‘CCA’) (formerly the Trade Practices Act 1974 (Cth)). Traders and businesses should refer to these guidelines, codes and pieces of legislation to reduce their risk of breaching the food standards legislation and consumer law.

Food advertising claims can be classified into various categories including, but not limited to:

1. Standard claims;
2. Health claims;
3. Endorsement claims;
4. Nutrition claims;
5. Certification and organic claims; and
6. Puffery.

We will examine each of these claims below.

Standard Claims

A standard claim is one that implies that the product is of a particular grade, quality, value or style. When making such a claim there is an objective component that you must be able to back up with evidence. Otherwise, your representation may amount to a misrepresentation or falsehood.

Another example is that a food item is ‘fresh’. That is, the food has retained its original properties, is otherwise unimpaired, has not deteriorated via a process of manufacture, is not canned, frozen and has not otherwise been preserved. The term ‘fresh’ further suggests that the food has been offered for retail shortly after it was harvested, picked or otherwise prepared or produced. Food that has been pre-cooked or frozen for an extended period would not satisfy the definition of ‘fresh’. As such, a fresh food claim on a frozen food package may be misleading or deceptive.

Food is sometimes advertised using numerical figures. For example, ‘100% organic ingredients used’ suggesting that the food has been wholly constituted from the stated ingredients. Purity or wholeness is considered to be ‘a state of being free from extraneous matter of a different, inferior or contaminating nature’. Take care to avoid making such claims if you can’t support them with evidence.

Health Claims

A health claim is one that states, suggests or implies that a food product or a certain property of the food product has, or may have, a positive health effect (section 1.2.7.2 of the Code). When we speak of a positive health effect, we are referring to an effect on the human body, including one that is physical, mental, functional and physiological. The Code prescribes the high and general level health claims that producers can make regarding food products and/or ingredients contained in them. Schedule 4 also outlines the form such claims must take. If the Schedule doesn’t contain a term or phrase, a claim cannot be made. Interestingly, however, ‘healthy’ does not appear in the Schedule.

Fat-free claims, on the other hand, do appear in the Code. According to the Schedule, a product can be labelled as, for example, 85% fat-free, only if the food meets the conditions for a nutrient content claim about low fat. A food product can claim its low fat if it contains no more fat than 1.5g/100ml for liquid foods or 3g/100g for solid foods. Also, for food to be claimed as being a certain percentage fat-free (e.g. 85%), it must be at least 85% fat-free. Again, in this particular instance, proving the claim with evidence is key to compliance.

Low in sugar claims follows similar guidelines. A product may be labelled as being low in sugar if, and only if, the food contains no more sugars than 2.5g/100ml for liquid foods or 5g/100g for solid foods (Schedule 4).

Endorsement Claims

An endorsement claim asserts that a particular person or entity endorses the food. Food suppliers are allowed to make or include an endorsement on a food label if they keep the required records and make such records available on request (section 1.2.7 – 24 of the Code). Namely, a food supplier must retain proof or evidence of the following:

• Permission, which clearly shows that the endorsing body has consented to the endorsement;
• The entity giving the endorsement has a nutrition or health-related function or purpose e.g. The Heart Foundation;
• The endorsing body is a not-for-profit entity; and
• The endorsing body is not commercially or otherwise related to the food supplier (section 2.7-24(5) of the Code).

Nutrition Claims

A nutrition claim is one that represents, states, suggests or implies that a food product has particular nutritional properties and includes a reference to:

• Energy, salt, sodium or potassium;
• Amino acids, carbohydrates, cholesterol, fat, fatty acids, fibre, protein, starch or sugars;
• Vitamins or minerals;
• Any other nutrients; and
• Biologically active substances (section 1.2.8).

A nutrition claim must be stated together with a statement about what form the food takes unless it is the same as when it is sold (section 1.2.7.11 of the Code). Where a nutrition claim is made about food, a nutrition information panel must be included on the food packaging (section 1.2.8(3) of the Code). The manner and form of the nutritional properties must adhere to section 1.2.7 and Schedule 4 section 4 – 3 of the Code.

Certification and Organic Claims

Sellers of food are entitled to make organic claims via certification marks if they meet the compliance standards of the body charged with managing the certification mark. As a general comment, consumers would expect food which has been labelled as organic to be free of synthetic fertilisers or herbicides. There is a voluntary Australian standard for growers and manufacturers wishing to label their products organic without a certification mark. This is the Australian Standard 6000-2009 for Organic and Biodynamic Products. The standard provides a useful starting point when determining if a product is organic and whether you can advertise it as such.

Puffery

At times, businesses will use wildly exaggerated claims about a product. The claims are such that no reasonable person could treat them seriously or find them misleading and deceptive. The practice of making such wild exaggerated claims is known as puffery. Puffery can relate to almost anything including the attributes or characteristics of food products. Consumers cannot reasonably rely on puff statements. Mere puffs, such as ‘super duper tasty’ or ‘the greatest jam in the world’ do not breach the food standards provisions.

Key Takeaways

Any and all advertising claims on food packaging must be capable of being substantiated. The type of evidence required to verify a claim will depend on the circumstances of the case. In particular, great care should be taken when making an endorsement claim, or if you compare your product against key industry players or market leaders. Large entities or wealthy individuals are more likely to institute legal proceedings on the grounds of defamation, or that an advertising claim is misleading or deceptive.

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If you would like to know more about food packaging and advertising claims, get in touch with our advertising and consumer lawyers on 1300 544 755.