Crunching numbers - Mandatory calorie laws come into force
The Calorie Labelling (Out of Home Sector) (England) Regulations 2021 (the Regulations) are now in force.
Qualifying businesses will now be required by law to display kilocalorie information at the point of choice for consumers. The repercussions for non-compliance range from investigation notices and penalty fines of £2,500, to criminal proceedings for subsequent non-payment or non-compliance.
The Regulations constitute a watershed moment in the UK Government’s healthy eating policy and should be considered closely alongside the guidance to ensure that the finer details and exemptions are accounted for when implementing changes.
1. Qualifying Businesses
For the purposes of the Regulations, a ‘qualifying business’ is one with 250 or more employees which sells non-prepacked food or drink suitable for immediate consumption by purchasers. Examples of such businesses include restaurants, pubs, fast food outlets, home delivery services and third-party apps selling in-scope food. Also included are cafes and takeaways within larger shops/venues and contract catering services (for example – at events and canteens). Some specific businesses will be exempt, including educational, medical, and social care institutions.
The Regulations have been carefully drafted to bring contemporary business structures into their scope. For instance, when determining whether a franchise is a qualifying business, the total number of employees in the franchise is considered, as opposed to the number of staff employed by each individual franchisee. Similarly, companies serving as ‘remote providers’ of food by way of online food delivery services, are responsible (irrespective of size) for displaying kilocalorie information on food that is offered by the qualifying businesses using their platforms, websites, applications, etc. While calorie labelling is not required in establishments when food is provided ‘in-house’ (including exempt businesses above), the Regulations will apply to a qualifying external business providing catering at another establishment.
2. Foods in scope
Assuming the provider is a qualifying business, the Regulations will apply to foods which are available for immediate consumption, i.e. offered for sale for consumption on the premises of sale or offered for sale for consumption off the premises of sale, without any need for subsequent preparation by the consumer, and are not “pre-packed” (defined separately in Retained EU Regulation 1169/2011). This would include food without packaging, food packed on the sales premises following consumer requests and food prepacked for direct sale.
Some everyday examples of foods in the scope of the Regulations include:
- Bakery items such as pastries and sausage rolls;
- ‘Build your own’ sandwiches;
- Hamburgers, fries and onion rings; and
- ‘Pick and Mix’ sweets
Certain foods such as fresh fruits/vegetables are exempt if they are not added to other food or sold as an ingredient in food consisting of more than one ingredient. A similar exemption will apply to fish, meats, and cheeses if they are not added to other food or sold as an ingredient in food consisting of more than one ingredient. Therefore, foods like sliced ham and rotisserie chicken sold for consumption off-premises do not need to be calorie labelled. Contrastingly, fish sold as part of a sushi platter will fall within the Regulation’s scope. Another notable exemption deals with food provided in specific contexts, including in the course of a charity’s activities, food provided to educational institutions for students under 18 years of age and food provided (not for payment) to patients at a hospital. Businesses will also be relieved of the exemption for seasonal menu items provided for less than 30 days a year, where changes to calorie labelling may be administratively unworkable or disproportionate, particularly where that item is a result of unexpected surplus or diverted food waste.
3. Information displayed
A qualifying business offering in-scope food must display, at the “point of choice”, the following:
- The energy content of each food item, measured in kilocalories;
- The portion size to which the calorie information relates; and
- That “adults need around 2000 kilocalories per day”.
That “point of choice” will be where the customers choose what food to buy, principally a physical or digital menu (including third-party delivery app and online menus) or display in the premises themselves, and the information must be easy to read and not hidden or obscured.
Further precise detail on the format and frequency of that information should also be considered, depending on the point of choice material. For example, a children’s menu will need calorie information but will not need the statement that adults need around 2000 kilocalories per day as their calorie needs are less. Otherwise, that statement should ordinarily be on every page of a menu and in a prominent position to be read at the point of choice.
A business may also provide, at the request of a customer, a menu without the above information, though cannot do so by default.
While enforcement will be at the discretion of the of the relevant authorities, the new Regulations outline a framework of penalties in the event of businesses failing to comply.
Enforcement officers are encouraged to engage in conversation with qualifying businesses in the first instance, to resolve potential non-compliance. If the officer has reasonable grounds for believing that a business is non-compliant, they are authorised to issue an improvement notice which effectively provides an opportunity to secure compliance. Failure to comply with an improvement notice constitutes an offence under the legislation for which the authority may impose civil sanctions by way of a £2,500 fine as an alternative to criminal prosecution. In the event that a fine is imposed, the enforcement authority will retain the right to bring criminal proceedings against a non-compliant business. It is anticipated that in practice, criminal prosecution will serve as the last resort in instances of continued/rampant non-compliance and/or non-payment of fines imposed.
A common concern in the industry is that the new Regulations will serve to exacerbate the rise of operating costs for qualifying businesses as well as prices for consumers at a time when the perfect storm of supply chain shortages, rising energy costs and the long-lasting effects of the pandemic, continues to take its toll on the hospitality sector. This is not only due to the costs and time required to precisely calculate the caloric composition of each item on the business’ menu but also the costs involved with re-creating menus, boards, online platforms, websites, etc. in order to accurately display this additional information. One obvious way to mitigate such costs would be for businesses to factor in their “calorie counting” at the product development stage.
Businesses will be anxious to ensure that calorie information is accurate. Retained EU Regulation 1169/2011 requires average values based on one or a combination of the manufacturer’s analysis, a calculation from known average values or a calculation from generally established and accepted data (for example the McCance and Widdowson’s Composition of Foods dataset). Government guidance suggests that a tolerance of plus or minus 20% may be an acceptable margin of accuracy and should be considered by enforcement officers in the context of the food served, including the reasonable accuracy of serving sizes.
There are also wider supply-chain considerations, as businesses in the industry rely on information, including calorie content, throughout, including from other suppliers where the food is not produced by the business itself. Retained EU Regulation 1169/2011 requires suppliers to provide sufficient information to the business to enable the provision of mandatory information to the consumer, now including calorie information. Working closely throughout the supply chain to ensure the accuracy of that information, and to agree how that is calculated and provided, is vital for ensuring compliance.
Some in industry question whether calorie labelling will meet its stated aim of enabling and encouraging customers to make healthy choices. There is a debate to be had as to whether calories are the right focus of attention at the heart of a healthy eating strategy instead of focusing on a balanced diet taking a holistic view of the nutritional value of foods - including vitamins, fibre, salt and fat content - where focus on calories alone may see consumers ditching nutritionally balanced foods perceived as unhealthy due to their calorie content in favour of a lower number of "empty" calories. From a commercial perspective, there is also the concern that this will lead to a decline in sales of certain menu items which have higher calories than others. This remains a space to be closely watched.
6. Future developments
Up until now, nutritional information needed only be displayed on pre-packaged food products. The rationale behind the new legislation is that the more information available to consumers, the more likely they are to make health-conscious decisions when purchasing food for immediate consumption.
By way of guidance published last year, Public Health England recommended that businesses providing food in the out of home sector:
- Reduce portion sizes, salt, sugar and frying practices;
- Promote healthier options; and
- Procure healthier ingredients.
Further legislation in this area, which might be considered even bolder than the current Regulations, is anticipated. For example, the Government confirmed in July 2021 that promotional restrictions on retail food and drink high in fat, salt and sugar (HFSS) will take effect this October. Legislation has also been laid before Parliament which if passed, would ban paid advertising of HFSS food and drink on television between 21:00 and 05:30.
Whilst details are awaited, it is apparent that the direction of travel will be for individual businesses to discourage the promotion and sale of unhealthy foods and encourage healthy alternatives, arming customers with the information necessary to make that choice. However, that comes at a cost, and the impact is awaited.