Candy canes, biscuits, punch and gingerbread – the Christmas season beckons with all kinds of treats. They have one thing in common: sugar is the essential ingredient.
High-sugar products and, moreover, nutrition have always been politically charged. This is reflected in statements and well-intentioned proposals, but above all in concrete regulatory measures. In the upcoming year, changes will be made at both national and European level, especially in the area of consumer protection. At the EU level, the focus of legislators is also increasingly on sustainability in the sweets production chain. This article provides an outlook on the coming political developments for the sectors concerned at national and European level.
German national projects: Nutri-Score and reduction targets
The regulatory debate on sugar – and surely other ingredients – is expected to be kicked-off as early as mid-December 2022. According to the current internal cabinet schedule, the responsible Federal Ministry of Food and Agriculture (BMEL) will adopt the cornerstones for a “Roadmap to the Federal Government’s Nutrition Strategy” on 14 December. This strategy was agreed in the coalition agreement and should include new proposals in addition to existing measures (e.g. National Reduction and Innovation Strategy for sugar, fats and salt in processed food products). The final strategy is to be developed by the end of 2023, so that implementation may begin in 2024. It is very likely that sugar will feature prominently as an ingredient in processed food products.
This can be revealed with just one glance at existing political documents. For example, the current coalition agreement mentions two concrete fields of action regarding sugar, which are to be worked on: On the one hand, legislators jointly agreed on “scientifically based reduction targets for sugar, fat and salt, tailored to target groups” (p.44 ff.). Secondly, concrete work is to be done on restricting advertising for products with a high sugar, fat or salt content in the context of television commercials and advertisements in the online sector – provided that these are specifically targeted at under 14-year-olds (p. 45). In addition, the nutri-score is to be revised and evaluated (p. 45). At the same time, the ministry can refer to a resolution of the Conference of Health Ministers (GMK), which was passed by the responsible state ministers in June 2020 and also aimed at reducing the sugar content in the diet. The two points included in the coalition agreement also appeared in this resolution, along with other measures (e.g. adjustment of taxes). The BMEL can already draw on a catalogue of measures. With the previously mentioned National Reduction and Innovation Strategy for sugar, fats and salt in processed food products (NRI), the Ministry worked together with manufacturers and industry on voluntary commitments for the content of processed food products during the last legislative period. With the National Reduction and Innovation Strategy for sugar, fats and salt in processed food products (NRI) mentioned earlier, the Ministry worked together with manufacturers and industry on voluntary commitments on the content of processed food products during the last legislative mandate. First successes were achieved in the so far sole evaluation report on the strategy, such as the ban on added sugar in teas for infants and young children. As an outlook, the interim report should maintain and ideally strengthen the momentum taking place at the time.
A review is therefore useful in order to anticipate the regulatory topics and requirements that could be discussed in the political process outlined above. Although the process has already begun, it will only really gain momentum after the key points have been presented – i.e. in 2023. Here, companies and associations can contribute to the shaping of the German government’s nutrition strategy by means of the official participation formats, but also in supporting discussions, with their positions and arguments.
State of play in Brüssel
Beyond the federal level, a glance at Brussels is also worthwhile. Because there, too, efforts are being made to remove the hurdles to healthy eating. In addition, the European regulatory debate in the area of corporate due diligence in the value chain is gaining momentum.
Nutri-Score und Nutri-Profiles
In May 2020, the European Commission published the Farm to Fork Strategy as part of it European Green Deal with the ambitious goal to promote healthy diets. Part of this is a planned regulation to provide stricter rules for health information on unhealthy foods. This initiative on so-called nutrient profiles sets maximum levels for nutrients such as sugar, fat and salt in food, beyond which the use of nutrition or health information will be restricted or even banned. In concrete terms, breakfast cereals that exceed a certain sugar limit would, for example, no longer be allowed to advertise their vitamin or fibre content.
According to the strategy, nutrient profiles can serve as an effective tool to educate consumers to make more informed choices. The Commission also expects that the introduction of nutrient profiles will lead to a healthier composition of ingredients in food products. Similar arguments are also put forward by advocates of a multi-coloured nutri-score, which is not only being discussed in Germany: A total of seven European countries have endorse it and want it to be placed on more products: Belgium, France, Germany, Luxembourg, the Netherlands, Spain, and Switzerland. Consumer protection organisations such as the EU association BEUC also strongly support and demand nutri-score and nutrient profiles. The European Parliament is also very positive about the introduction of nutrient profiles, calling them “long overdue [and] still useful and necessary” as early as October 2021 in its Resolution on the Farm to Fork Strategy.
However, critics argue that simplified information labels could disadvantage certain food groups if health-conscious consumers avoid these products because of the food labels. Italy, for example, has always been vehemently opposed to the nutri-score – a point recently reiterated by the new Minister of Agriculture, Francesco Lollobrigida, at his first meeting of responsible EU ministers in Brussels on 21 November. While the roadmap for the proposal was already published by the Commission in December 2020, the draft legal act for a unified food labelling is still pending. Originally scheduled for the end of this year, it is now only expected in spring 2023.
Sustainability in the value-chain of sugary products
Regulatory measures affect manufacturers of sugar-containing products not only in the protection of the end consumer, but also at earlier stages of the value chain. In Germany, for example, large companies (3,000 employees or more) must follow the requirements of the Act on Corporate Due Diligence in Supply Chains (“Supply Chain Act”) from 1 January 2023. From 2024, this figure will be lowered to 1,000 employees (see blog article for more information on the German law).
At the EU level, measures analogous to the German Supply Chain Act form a regulatory framework that was established by the current European Commission and consists of three legislative proposals:
- Proposal for a Regulation on deforestation-free products
- Proposal for a Directive on corporate sustainability due diligence
- Proposal for a Regulation on prohibiting products made with forced labour on the Union market
With the goal of tackling global deforestation and forest degradation caused by the EU, the Commission presented a legislative proposal, the Deforestation Regulation, in November 2021 as part of the Green Deal. This planned regulation is intended to impose due diligence obligations on companies that put raw materials – including cocoa, palm oil and sugar cane – and some products made from them onto the EU market or export them from the EU. But what does this mean in concrete terms for manufacturers of products containing sugar and what for EU Member States?
Companies placing the above raw materials on the EU market would have to ensure that these products have not been obtained from land that has been deforested after 31 December 2020. They would also be required to analyse risks in their supply chain and take mitigation measures as part of their due diligence. The Commission plans a benchmark system that classifies producer countries into three risk categories – low, medium, high. Based on this classification, the scope of the due diligence to be carried out is to be adjusted.
The Council of the EU reached a General Approach on the Commission’s proposal in June 2022. So-called trialogue negotiations between the legislators started at the end of September but are turning out to be rather controversial.
Parallel to the Deforestation Regulation, the Commission presented the proposal for a directive on corporate sustainability due diligence in February 2021. This Directive imposes more general human rights and environmental due diligence obligations on companies, which are to apply to the value chain. Sweets and other sugary products are, like all food and beverages, defined as risk sectors in the Directive (see our specific blog article on the topic). The Deforestation Regulation thus imposes precise due diligence obligations in relation to deforestation, while the Directive on corporate sustainability due diligence creates a framework of more general obligations, whose scope also covers the value chain of sweets and other sugar-containing products.
The final piece in the triad is the Proposal for a Regulation banning products made with forced labour on the Union market. It was first published in September 2022 and is therefore still at the beginning of the process. Its risk-based approach aims at respecting human rights, it obliges all companies – including SMEs – to conduct due diligence in the area of social sustainability. According to the proposal, the ban applies to domestically produced products as well as imports and exports. Sweets as well as other sugary products could be affected by this planned legislation, as the raw materials needed for their production often come from countries with low labour protection.
The implementation of the proposed legislation would be a major step towards a healthier and more sustainable society. Legislators argue that informing consumer as much possible is essential for enabling them to make a healthy choice at the supermarket shelf. In the future, politics will set the course to achieve this goal – in Germany as well as at the European level. In order to react promptly and appropriately to the coming changes and to ensure a targeted orientation of the legislative proposals, it is essential for companies in the sweets and other affected sectors to keep an eye on all political levels.