Retail Operations

By: Jennifer Hatcher, Chief Public Policy Officer, Senior Vice President, Government Relation and Public Affairs, Food Marketing Institute

Consumers ask a lot of questions about the foods they purchase. Today, food retailers answer questions from customers regularly ranging from “how do I cook this?” to “where was this product sourced?” FMI’s U.S. Grocery Shopper Trends research shows shoppers want to know where ingredients originate; how products travel through the food supply chain; details about the products packaging, and much more. This list is only likely to grow more complex in the future. 

With the support of FMI and many of our members, Congress passed Public Law 114-216 on July 29, 2016, which establishes a national standard that the United States Department of Agriculture (USDA) can use to put in place a bioengineering (BE) disclosure standard, rather than a confusing and expensive state-by-state approach. In order to implement the law, the USDA Agricultural Marketing Service (AMS) published a proposed rule in the Federal Register on May 4, 2018 and requested comments from a variety of stakeholders, which were due on July 3.  

With assistance from our members and industry partners, FMI filed comments on those aspects of the proposed rule most likely to affect food retailers, manufacturers, customers and the grocery supply chain. Under the proposed rule, a manufacturer has a variety of options for providing the disclosure, including on-pack text, a symbol and through electronic or digital disclosure, such as SmartLabel®. The final regulations will provide additional clarity and certainty on the specifics regarding the placement for disclosure.  

What Does the Proposed Rule Apply To?

By way of background, the proposed BE rule applies to FDA-regulated products subject to labeling requirements under the Federal Food, Drug and Cosmetic Act (FDCA), and in certain circumstances, USDA-FSIS regulated products. A few exceptions in the rule are very clear and others will need to be defined further.

Parts of the Proposed Rule that Affect Food Retailers 

• Voluntary Disclosure: While the law provides a standard by which food produced with bioengineering crops must be disclosed, FMI also advocated for the ability for food manufacturers and retailers to voluntarily disclose information above and beyond that which is required under the law that customers request. Specifically, for products that do not meet the definition of a “bioengineered food,” but may be derived from bioengineered crops, FMI urged AMS to provide a framework to ensure additional voluntary disclosures are permitted and consistent across the country. 

• “Food served in a Restaurant or Similar Retail Food Establishment: "Congress made clear that they did not intend for the law or proposed rule to prepared foods given the challenges and complexities associated with labeling these foods. For grocers, this varies significantly and include foods on premise to ready-to-eat items and foods requiring preparation. Therefore, our comments largely focus on consistency in this area of the proposed rule to ensure that customers have a similar experience whether they purchase a food in a restaurant or in a location like a supermarket. In particular, we asked FDA to clearly outline the foods served by similar retail establishments that are not intended to be labeled and provide additional detail on scenarios where food retailers or restaurants might be responsible for disclosure.
• Adequate Time for Compliance: Ensuring adequate time for implementation is another critical element to ensure both the packaging and supply chain teams can meet the compliance date. As such, FMI has requested that USDA-AMS establish in the final rule a compliance date of two years (24 months) after the effective date of the final rule to provide a more predictable implementation period in order to: prevent increased compliance costs, ensure that the supply chain can adjust, and to allow USDA, along with the stakeholder communities, to educate customers about BE disclosure and digital disclosure including SmartLabel®. 

While the timing for a final rule has not yet been determined, FMI will provide updates on new developments related to the rulemaking. Read more on FMI’s BE Comments here.