Essay: Misbranding of Food – Indian Laws and Regulations

ABSTRACT
This report titled as ‘Misbranding of Food: Indian Laws and Regulations’, an analysis tries to understand the concept of Misbranding of Foods in India using the modern statute Food Safety and Standards Act, 2006, and relevant rules and Regulations. Which was fully implemented on 2013 by way of multiple amendments to food safety, labeling and packaging regulations, as were new draft guidelines on labeling of imported products compliance with International standards, the Food Safety and Standards Authority of India (FSSAI) undertook to harmonize food safety regulations with Codex Alimentarius.
This paper upon examining the provisions tries to understand what is the meaning of Misbranding as per the definition as per act and practical sense, what act construed it is offence to what extend the activities are punishable, what is the maximum punishment for this kind offence. Whether the punishment really making any sense in practice.
The term Misbranding in Food business broadly refers to any activity leads to misrepresentation, fraudulent, deceptive, and dishonest or unfair trade practices which leads cause confusion and mislead the consumer towards a wrong choice of any article of food or simply we can say activities of food business operator not complied with the FSS Act, 2006 and its rules and regulations. However the definition not enough to cover all the Food misbranding activities of Food business operator.
Chapter 1 of this report tries to give a broad idea of food businesses in India and the terms like Brand, Misbrand, Label etc., and problems faced by Food business operator and problems faced by Consumers in India also examines with the legal and institutional framework setup to deal with Misbranding of food allied with relevant other laws in India and which law is good for whom to deal with the concept of Misbranding of food, in theory as well as in practice.
Chapter 2 in depth analysis of the provisions and what may be the impacts in market specifically among food business operator and Consumer and how it adversely affects those groups and hence, adversely affects the confidence among players.
Chapter 3 highlights the importance of effectively dealing with Misbranding of food in light of effective implementation of provisions and empowering consumers to tackle the issues. After analysing all those issues suggests some way forward and highlights a need for amendment in the current legislature and institutional set-up. One of the way suggested is to create and increase awareness among the players such as food business operator small level and among consumers, including setting up of proper regulatory body to control advertising agencies and to stop misleading advertisements and promotions, including getting premarket approval of a product, label and contents of advertisements and proper implementation of food recall and review.
Finally, Chapter 4, concluding with future scope of work based on the observations made by this report. It is important to maintain a balance among players, taking into account the interest of consumers, of food business operator and of the general public interest in fair and honest play in the market by way of enforcement of law.
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3 METHODOLOGY
3.1 OBJECTIVE OF STUDY
The overall objective of the project is to analyse and understand the provisions and market situation regards Misbranding of Food in India and suggest an efficient approach to tackle the same
3.2 HYPOTHESIS
There is a need to highlight the issues pertaining to Misbranding of Food in India in light of the present institutional set up in India and to suggest effective and efficient policy actions by the government.
3.3 SCOPE AND LIMITATIONS
Given the lack of effective time in hand for finalizing the report, the scope is limiting to FSS Act and rules, import regulation, labeling regulation, with some other relevant provisions in other statutes and relevant judicial interpretations.
3.4 RESEARCH METHODOLOGY
The research methodology adopted in the dissertation is Doctrinal. Research is analytical and descriptive since because of the new primary act was fully enforced in 2013 and rare availability of judicial interpretations with new primary act. Few statistics have been examined to understand and analyse the concept of Misbranding of Food in India. Uniform Footnoting style has been used throughout the dissertation.
Bare provisions and some relevant judicial interpretations of the act used as a primary source of tools taken in the project preparation. Various reports and newspaper articles are referred as secondary source of tools.
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4 INTRODUCTION
It is important to look at some statistical data before getting into the details of this subject. The annual GDP in 2010 was at ever highest 8.5 percent and then slipped to a ten-year low of 5 percent in 2012 and then dipped again to 4.4 percent in 2012. The major challenges to the economy being depreciation of rupee and stubborn inflation nevertheless India are projected to become world’s largest economy by 2025 .
India stands second in terms of food production in the world and fifth in terms of producing, growing, consuming and exporting. This particular sector is on its path in gaining lot of importance because of ever growing population and increase in consumer demand.
Huge investment opportunities has been opened up in food processing and equipment industry including food processing, packaging, canning, preservation and specialty processing after this rise.
The forecast given by Indian Council Agricultural Research estimates that this sector will reach $194 by the end of 2015 and the demand for processed food is expected to increase to about 8.5% by the end of 2017 . The main reason cited behind this rise is increase in per capita income, rising disposable income of middle class families, increased urbanisation, developing middle class families, households with dual incomes, changing demographics, Increase in media penetration has led to dramatic changes in lifestyle and food habits of people and in turn led to a boost in demand for processed food, beverages (alcoholic & non-alcoholic), snacks, etc.
When it comes to food shopping Indian consumers still have very traditional habits, they use a variety of small stores such as bakeries and butchers including push cart vendors. On the other hand most of the dry goods and household items are purchased from kirana stores, which are typically family-owned outlets found on almost every street corner and they also offer home delivery. Though in the beginning there was not any great acceptance and penetration of American and other foreign packaged food products since Indians generally prefer fresh products. But however as a result of recent developments and change in lifestyle there is increase in acceptance of packaged ready-to-eat food products is increasing especially among younger consumers and urban middle class.
Typical imported food items that can be spotted in retail stores in major cities include dry fruits and nuts, cakes and cake mixes, pastries, chocolates and chocolate syrups, seasonings, biscuits, canned fruit juices, canned soups, pastas, noodles, popcorn, potato chips, canned fish and vegetables, ketchup, breakfast Cereals, and fresh fruits such as apples, pears, grapes and kiwis . The change in food eating habits and increasing heath awareness among consumers it depends upon various factor, factors like Age, gender, educational level, awareness, income level etc. safety of the food is very important factor to the consumer, food industry and economy. For example Consumers often compare prices of food items in the grocery store to choose the best value for money.
Having said that one of the other important detail consumers will look at is the food label on the product. For an instance a person with high blood pressure would like to choose products that have less salt (sodium) content. Hence for example, if he/she wants to buy tomato soup they would indeed take a look at the food label of the available products to compare the nutrition information to choose one with the lowest salt content. The business operators also provide specific information or specific nutritional value pertaining to the product.
Primarily the content information available on the label itself serves the purpose of comparing the products easily so that people can choose right kind of food product to meet their needs of finding right food for their special diets, increase or decrease intake of specific nutrients.
So it becomes clear that people do take a look at the food label and pays attention to the information given by the business operators or manufacturers through various means. If we look at the majority of products it definitely will bear claims of “zero trans fats, hundred percent natural, anti-oxidant rich, sugar free, etc. Now the important question that arises in our minds is whether all this information provided and claimed is actually true or not, the answer to this is only negative because unfortunately many of these labels are false.
To keep a check on this the FSS Act has come up with set of guidelines to be followed by the food manufactures while providing information regarding the claims in their labels and advertisements. But still many companies do not follow these guidelines given and choose to provide false or misleading claims in their food labels thereby cheating the consumers into buying their food products.
We are here not trying to curtail the right of food business operator to express detailed information of their product, but only to highlight the fact that as food business operator have the right to express detail of their product the consumer also have the right to receive the product information to make informed decision while purchasing the food products by looking at the nutritional facts, quantity, price, amount of calories and product comparison to choose the right brand.
Hence if false information is provided in those food labels or in Advertisements it will amount to misleading of consumer. As result the consumers’ needs and expectation are not met and it injures the consumer hardly. This misleading and false information about the food products makes them misbranded.
Before getting into the implications of misbranding we should understand the term ‘Brand’ first. The term brand means the “name, term, design, symbol, or any other feature that identifies one seller’s product distinct from those of other sellers”
They are used in business, marketing and advertising. Though the term brand as such is not defined in any legislation anywhere in the world but the definition of label mentions it means brand. The Trademark Act defines Mark which includes both the brand and label. But under Trademark legislation in case of misbranding it only gives remedy to the trademark owner to sue the infringing party, the consumer is the ultimate loser because he does not get any remedy on being misled by this infringing label.
Three major legislation defines the term ‘misbrand’ and few other legislation contains terms that are relevant to misbranding. Those include
1. FSS Act
2. Drugs and Cosmetics Act
3. Insecticides Act
4. Under legal metrology Act, 2009, the name is counterfeit/noncompliance of standard
5. Under the consumer protection Act, 1986, it is an umbrella act, in addition to and not in derogation of the provisions of any other law the remedy given in any other act defect or deficiency/ spurious good /unfair trade practice.
6. Under the Competition Act, it is called as unfair trade practices.
In the year 2013 Food Safety and Standards Act, 2006 was fully implemented and the Food Safety and Standards Authority of India (FSSAI) undertook to harmonize food safety regulations with that of Codex Alimentarius. Series of amendments and changes to food safety, labeling and packaging regulations were published including new draft guidelines on labeling of imported products . Still the statistics puts the picture in different way
‘ One third of the industry is unaware about the FSSA (therefore ignorant about the rules there under. These will need to be mandatorily implemented in the near future.)
‘ 86% of the industry appreciates the consolidation and unification.
‘ 10% of the respondents look forward to further unification (to avoid duplicate requirements like BIS, Agmark, etc with FSSA)
‘ 92% of industry hopes for International harmonization (new rules under FSSA with internationally accepted standards like Codex, amongst which the most important issues are food categorization system, food additives and labelling.)
‘ Industry feels that they are not adequately represented in the authority (looks forward to increased representation.
‘ 25% of all the respondents felt that it is critical that FSSA issues guidance notes and FAQs along with legislation (for consistent interpretation and ease of implementation).
In my work I have attempted to address the above identified issues and attempt to clarify to what extent the legislation relating to misbranding is being implemented and various other legal issues relating to Misbranding in food market
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5 STATUTORY PROVISIONS AND INTERPRETATIONS
The objective of the FSS Act 2006 on Misbranding of food is towards food safety and the elimination of deceptive marketing practices of their sales.
CONSUMERISM
Consumer awareness is growing at an increasing rate in India. In recent years a growing public concern on consumer protection has been observed in India and around the word. A social movement has indeed started that energizes consumers, promoting consumer awareness and educates consumers about their fundamental rights. This is called consumerism. It is a movement that protects the rights and powers of the consumers at large with regard to:
A consumer who buys any goods for consideration and
A consumer who hires or avails of any services for consideration, as defined by s 2(d) of the Consumer Protection Act, 1986.
The basic rights of the consumers, as propagated by the advocates of consumerism, are as follows:
Right to safety- the right to protection against the marketing of products that are hazardous to health and life.
Right to be informed- the right to be protected against fraudulent, misleading or grossly misleading with respect to the goods, advertising or other practices and to provide the facts needed to make an informed choice.
Right to choose- to be assured of satisfactory quality and services at fair prices
Right to be heard- the right to be assured that consumer interests will receive full and sympathetic consideration in the formulation of government policy and the fair expedious treatment in its administrative tribunals.
Right to seek redressal – against the unfair trade practices or unscrupulous exploitation of consumers.
Right to consumer education- develop on products and services and provide them with the skills to use the product information and protect their rights in general on the market. For the proper functioning of the legal system, it is necessary that knowledge of the existence of a legal remedy should be widely disseminated that people in general are aware of their rights. By increasing information to the right and remedy of the consumer will be better empowered to pursue its remedies. The application of this requirement to provide consumer education is the main task of the government and other authorities established for the people.
UNFAIR TRADE PRACTICE/ COMPETITION
For the purposes of promoting the sale any practice that injures public interest or the interests of all consumers, in person or in general. The main issue addresses the false representation made by the FBO for goods or services, or misleading representation about the usefulness of goods or services. On 1984, by amendment of the MRTP Act it included provisions to address unfair trade practices. The Sachar Committee addressed the issue and stated that,
Advertisement and sales promotion have become well established modes of modern business techniques. That advertisement and representation to the consumers should not become deceptive has always been one of the points of conflicts between business and consumer.
The Sachar Committee, therefore, recommended that a separate chapter discusses various unfair trade practices, so that the consumer, manufacturer, supplier, operator and others in the market can easily identify practices that are prohibited. Countries like India, a large number of consumers are illiterate, uninformed and unaware of their rights as consumers. Very often witness a large number of non-essential, substandard products, adulterated, unsafe and less useful products being pushed through by unscrupulous traders by unfair trade practices and deceptive methods. Subtle deception, half-truths and misleading omissions flood the media and advertising instead of the consumer is to provide accurate, relevant and useful information about the products, they are often exposed to information is factious, tending to their purchasing decisions bad. Transparent information is missing and needs to be a goal to be chased.
It is natural and viable to get buyers attention through mass media. So that way manufacturer can effectively compete with competitor at the same time the consumer is aware of relative merits and demerits of the goods and services available to him. This process is important for FBO to make profit, the dissemination of information intended to guide consumer choice cannot be performed not to choose their product. The need for expert guidance in acquainting the consumer with products and persuading him in his economic choices in terms of advertising has grown into 11.8% in 2013 to INR 917 billion. The sector is projected to grow to 15.2% to reach INR 1785.8 billion by 2018. The recent survey indicates past Food and beverages industry occupies first place in advertising on TV as 14% of Share in 2012. Ready to eat food companies are the major player in infotainment channels focused on sub-genres help them reach a targeted audience.
If a little information is dangerous, mis-information can be disastrous. For example, when a goods are praised to the point of untruth, or a competitors goods are falsely disparaged and the competitor then replies in kind, the result is not informed, intelligent choice, but rather its perversion; there is no ‘choice’ when selection is a function of competing untruths deceits, and misleading comparisons. Production is no longer regulated by consumer choice, and business success is no longer measured by consumer satisfaction. Moreover, the use of such deceptive techniques is not uncommon in the advertising field. The profit motive can be a powerful inducement to the destruction of principle, and control over consumer choice is a tremendous weapon in the arsenal of the un principled.
5.1 GENERAL
Indian government’s most recent update was on the realization and implementation of laws on food safety, standard and safety. The act of creating a statutory body called The Food Safety and Standards Authority of India, officially repealing the regulatory framework established by the eight existing food laws, consolidated to Food safety and standards rules and Regulations 2011 (hereinafter referred as ‘FSS Rules’ and ‘FSS Regulation’ respectively) on Auguest 5, 2011 India fully implemented the Law on Food safety and standards 2006 (hereinafter ‘FSS Act’).
On day to day life everyone come across lots of advertisements and mostly every day consumers are buying something for their personal needs. Most people are attracted by advertising and package which includes the label, even an educated consumer does not regularly check the label or packaging before buying anything, if the consumer is uneducated much worse; the consumer has reason to believe what the seller is saying. The FSS Act and FSS Regulations provides guidance for manufacturers and importers of food to how to make claims about their products. Some companies deliberately refuse to follow these guidelines, and some because of the ignorance of uneducated traditional food makers have failed to follow these guidelines. As a result many consumers have failed to identify the product identity or misled by the information mentioned in the article or deceptive claims which leads to the consumption of unsafe food inviting unwanted risks .
5.1.1 Food
Before entering into the subject, it is necessary to have an idea about food and misbranded food. Food was defined under Section 3(1j) of FOOD SAFETY AND STANDARDS ACT, 2006. It defines as
‘Food’ means any substance, whether processed, partially processed or unprocessed, which is intended for human consumption and includes primary food to the extent defined in clause (zk), genetically modified or engineered food or food containing such ingredients, infant food, packaged drinking water, alcoholic drink, chewing gum, and any substance, including water used into the food during its manufacture, preparation or treatment but does not include any animal feed, live animals unless they are prepared or processed for placing on the market for human consumption, plants, prior to harvesting, drugs and medicinal products, cosmetics, narcotic or psychotropic substances :
Provided that the Central Government may declare, by notification in the Official Gazette, any other article as food for the purposes of this Act having regards to its use, nature, substance or quality
The simple definition of Food is too wide, it includes all the substance in any form whether solid or liquid or gas or vapor, the only requirement is to be intended for human consumption. The definition also expressly certain categories of food and also included some specific categories of food like technologically improved consumables such as primary food , genetically engineered or in part, packaged drinking water, etc. this are all inclusion because of judicial interpretations of PFA Act. It gives wider power to state to declare any article as food for the purpose of this act.
5.1.2 Misbranded Food
The other part of the title is misbranded food, it is defined under Section 3 (zf) of FOOD SAFETY AND STANDARDS ACT, 2006. It defines as follows
(zf) ‘Misbranded food’ means an article of food ‘
(A) If it is purported, or is represented to be, or is being ‘
(i) Offered or promoted for sale with false, misleading or deceptive claims either; (a) Upon the label of the package, or (b) through advertisement, or
(ii) Sold by a name which belongs to another article of food; or
(iii) offered or promoted for sale under the name of a fictitious individual or company as the manufacturer or producer of the article as borne on the package or containing the article or the label on such package; or
(B) if the article is sold in packages which have been sealed or prepared by or at the instance of the manufacturer or producer bearing his name and address but –
(i) the article is an imitation of, or is a substitute for, or resembles in a manner likely to deceive, another article of food under the name of which it is sold, and is not plainly and conspicuously labelled so as to indicate its true character; or
(ii) the package containing the article or the label on the package bears any statement, design or device regarding the ingredients or the substances contained therein, which is false or misleading in any material particular, or if the package is otherwise deceptive with respect to its contents; or
(iii) The article is offered for sale as the product of any place or country which is false; or
(C) if the article contained in the package ‘
(i) contains any artificial flavoring, colouring or chemical preservative and the package is without a declaratory label stating that fact or is not labelled in accordance with the requirements of this Act or regulations made thereunder or is in contravention thereof; or
(ii) is offered for sale for special dietary uses, unless its label bears such information as may be specified by regulation, concerning its vitamins, minerals or other dietary properties in order sufficiently to inform its purchaser as to its value for such use; or
(iii) is not conspicuously or correctly stated on the outside thereof within the limits of variability laid down under this Act.
If we see the definition the first proposition that is sub clauses is misrepresentation made through label or advertisement to promote sales. Misrepresentation may be providing false information or providing unscientific claims. It may extend to using the reputation of another article of food which is belong to the property of others or for the purpose to cheat consumer arm extend to cheat regulator also. Instead provide regulatory complied product, FBOs creating a fictitious company to offer poor regulatory complied products to get unfair advantages. This unfair advantage activities tends to imitate or resembled manner likely to deceive another article of food, which may be plain use of label of another article of food or conspicuously labelled to imitate the true character of another article of food. In some cases FBOs are providing false or misleading material particulars like pure product, high content product, false ingredient information, unscientific claims. To get benefit out of geographical origin of a particular product or to mislead the attention of regulator FBOs claim/mentioning false origin of product.
To avoid all those problems some FBOs not even label their products or not fully complied with the Act. In some cases without a declaratory label stating the fact that the used artificial flavoring or coloring or chemical preservatives to influence the consumer mind or extending the life time of product unscientifically or violating the provisions of the act. Failed to sufficiently inform the actual use or potential problem/value after use of such products. Concluding the definition anything mentioned or not mentioned in the label of the product or in advertisement which is not complied with the law will makes the product as misbranding and misleading advertisement will make FBOs punishable under Misbranding offence.
After reading the definition four things are clear, that if the products are in prepackage labelling will determine the misbranding offence, if the products are not packed presentation will determine the particular activity is offence or not. Third thing is article of food will be considered misbranding if there is any misleading information present in the advertisement.
5.2 FOOD LABELING AND PRESENTATION AS WELL AS ADVERTISING AND UNFAIR TRADE PRACTICE
The PFA Act makes a clear distinction between adulteration of food and misbranding of food . The current law attempts to broaden the scope of how the adulterant is defined. This simply means that any material that is or could be used for the manufacture of food unsafe or sub-standard or misbranded or containing extraneous matter. In general, any adulteration lack real strength, purity and quality of a product, Misbranding focuses on representations made by the food business operator on the label or labeling, advertising, misrepresentation or erroneous information made by any manufacturer or any one.
Under Indian law section 23 of FSS Act takes care of packaging and labeling of foods and section 24 of FSS Act takes care of restrictions of advertisement and prohibition as to unfair trade practices. Where the section 48(2) (a) (ii) constitute an offence that failure to provide information to the consumer, including the information on the label or other information and other information generally available to the consumer more specifically adverse health effects, not only probable, immediate or short-term or long term effects but also on subsequent generations. Thus labelling must not mislead to a material degree as to the characteristics of the foodstuff and, in particular the nature, identity, properties, composition, quality, quantity, durability, the origin or provenance, method of manufacture or production, further misleading food claims are prohibited.
The basic regulations in respect of labeling is from FSS (Packaging and Labelling) regulation, 2011 and for import products FSS (Food Import) Regulations, 2013 are the governing regulations as amended. The provision that deals with restriction or what may appear on food label is given under section 23 of FSS Act, 2006. The main objective of labeling regulation is to protect the consumer from false/misleading or misrepresentation of information.
Label or Advertisement
The making of misbranding an offense is primarily to prevent false or misleading claims made through label or advertisement by the FBO. ‘Labelling’ is defined under Section 3(z) of FSS Act,2006 means ‘any tag, brand, mark, pictorial or other descriptive matter, written, printed, stencilled, marked, embossed, graphic, perforated, stamped or impressed on or attached to container, cover, lid or crown of any food package and includes a product insert’. The definition suggest that any matter of information given which are in form visually recognizable representation. A label would not include a verbal statement but section 3(b) of FSS Act, 2006 defines Advertisement it includes any audio or visual representation even includes smoke and gas. It suggests that even if a FBO shows smell of food product that can be misleading the consumer may constitute an offense. It should also be borne in mind that the subject mentioned above is also capable of becoming the mark. For all practical purposes, we can assume that any false or misleading with respect to food for human consumption statement may constitute an offense of false labeling or misbranding.
False or Misleading description
Likely to mislead
The representation of food product may literally true but practically false because of the non-representation of information or incorrect information as result of which consumer is likely to mislead to choose a particular food product. The standard is the information provided by the FBO must be appreciable by an ordinary prudent man. If the information given is of too technical in nature then it may lead an ordinary prudent man think of the product as something which is extraordinary in nature and induced them to buy the particular product or mere causing confusion in the minds of consumers will also constitute an offence of misbranding.
As indicated above, a label or advertisement may be misleading in nature even if it contains a statement of the exact facts of the composition of the food. However information on the label or advertising must comply with the regulations. The misleading may be due to the product name, instruction of use, background illustration, process, treatment etc. a label states that 100% fruit bulb, attempt to misuse of traditional food names and terms may constitute an misbranding offence. In conclusion, even if the information given in the label or advertisement was factually correct but the normal consumer will most likely to get misled then it will also constitute as an offence.
The in-depth discussion is as follows.
5.2.1 Label of the Package in general
If the article of food is misbranded means, the representation made through label of the package, offered or promoted for sale with false, misleading or deceptive claims upon the label of the package. The essential purpose of food labels is direct communication to consumers to make them aware of the product information. It helps to ensure fair play between food business operators and consumers. It allows consumers to differentiate products from other players to make informed purchasing choices.
As per the Labeling regulation, the information needs to be easily understandable by the consumers, helps to choose the product based on comparison and helps to prevent the circulation of mislabeling of food label which ultimately violating regulatory provisions and misleading the consumers.
5.2.1.1 Rectifiable and non-rectifiable labelling for imported food
As per guidelines issued by the FSSA Authority, On October 13, 2011, the Food Safety and Standards Authority of India (FSSAI) published ‘ad-hoc guidelines related to imported food clearance process by FSSAI’s Authorized Officers.’ According to the guideline absences of the vegetarian/non-vegetarian logo, and name and address of importer, are considered ‘rectifiable labelling deficiencies’ which may be dealt with via sticker labels in the customs bonded warehouse at the port.
However, the absence of name and address of the manufacturer, the list of ingredients, production date, best-before or expiry date; batch or code or lot number; net weight or volume; or nutritional information, if any, is not rectifiable with sticker labels.
Furthermore, on December 21, 2011, the FSSAI issued a corrigendum on Food Safety and Standards (packaging and labelling) Regulations, 2011. According to this corrigendum, wholesale packages are no longer exempted from labelling requirements. Wholesale/bulk shipments arriving in India will now have to be labelled with:
List of ingredients,
Date of manufacture/ packing,
Best before date/expiration date,
Vegetarian logo/non-vegetarian logo,
Lot Number or Batch Number or Code Number,
Name and address of importer and manufacturer,
Country of origin
5.2.1.2 Label of Package in Imported food
Pursuant to section 23, the food business operator must follow the manner as may be specified by regulations providing information labeled shall not contain any statement, claim, design or device which is false or misleading in any particular concerning the food products contained in the package or concerning the quantity or the nutritive value implying medicinal or therapeutic claims or in connection with the place of origin of food products. Promote the information on the package label of package including the shape, appearance or packaging, the packaging materials used or even the arrangements in the display should not mislead the consumers.
According to section 48 (2) (a) (ii) information provided to the consumer, including information on the label, or other information generally available to the consumer concerning the prevention of adverse effects on a specific food or category of food, not only probable, immediate or short-term or long-term effects of that food on the health of a person who consumes article of food, but also on future generations. Further, such food will be called as unsafe or injurious to health which will be interpreted as an offense and shall be punishable under the FSS Act.
As per section 52, any article of food for human consumption which is misbranded, person liable to a penalty up to 3 lakhs rupees and Adjudicating officer may issue a direction to the person found guilty and such article of food either the person allowed to rectify the mistake or the article of food shall be destroyed.
According to section 61, it prescribes punishment for false information it says that if a person knowingly provide false or misleading information will be punishable with imprisonment up to 3 months and also with fine may up to 2 lakhs. Exception or defense which may or may not allowed. As per section 80(B)(2)(a) defense of due diligence may be accepted if the commission of offence was due to an act or default of third person or reliance on information supplied by another person.
5.2.2 Food Presentation
According to the FSS Act, every FBO shall ensures the label and presentation of food should not mislead the consumer. It is an offence of misbranding if the person manufacturing, distributing, selling or exposed for sale or shipment or delivery to an agent or broker for the sale of packaged food products or the food product are not marked and labeled in accordance with the regulations or the food presentation is likely to mislead the consumer as to the nature or substance or quality of the food. ‘Presentation’ is not defined under FSS Act. But under section 23(2) of the FSS Act refers labeling and presentation of food, includes their shape, appearance or packaging, the packaging materials used, the manner in which they are arranged and the setting in which they are displayed, and the information which is made available about them through whatever medium, does not mislead consumers. One example of misleading presentation may be artificially flavored fruit product being packed in fruit-shaped containers.
5.2.3 Through Advertisement
If the article of food is misbranded through means of advertisement, the representation made, offered or promoted for sale with false, misleading or deceptive claims through advertisement. ‘Advertisement’ means any audio or visual publicity, representation or pronouncement made by means of any light, sound, smoke, gas, print, electronic media, internet or website and includes through any notice, circular, label, wrapper, invoice or other documents.
Commercial advertisements are coming under freedom of speech and expression guaranteed under Constitution of India with reasonable restrictions. FSSAI has the authority to exercise the reasonable restriction on behalf of the interest of consumer and regulate unfair trade practice in the food sector.
Section 24 of the Act prohibits unfair trade practices through advertisement and advertising should be in accordance with the law, rules and regulations. Subsection 2 of Section 24 discusses on two dimensions, one is in the interest of potential customers and the other is unfair trade practice. Unfair or deceptive trade practice includes false statements on the standard composition, quality, quantity or special quality, misrepresentation, false advertising representation on the usefulness and providing a state guarantee on the effectiveness does not rely on a justification adequate or scientific. The burden of proof is shifted to the person who raises the question whether the defendant has proven that the information provided on the basis of scientific justification.
Section 52 prescribe the punishment for misbranded food and Section 53 of the act prescribe about penalty for misleading advertisement, any person not only publisher but also a party to the advertisement, who made false claim which is likely to mislead shall be liable to pay Rs. 10 lakhs at maximum. Claim the accuracy of the information contained in the label or advertisement relating to any article of food shall be determined by the court of law.
Section 80 of the act says Defence may or may not be allowed relating to the publication of advertisement. it is a defence for a person to prove that the person carried on the business of publishing or arranging for the publication of advertisements and that the person published or arranged for the publication of the advertisement in question in the ordinary course of that business. Defence will not be applicable on three conditions except, either if the person reasonably known that the publication of an advertisement was an offence or the person informed by the relevant authority about the offence or the person is a food business operator.
5.2.3.1 Control of Misleading and Comparative Advertisement
It is to ensure that adequate and effective means exist to combat against misleading advertising and compliance with the provisions on comparative advertising in the interests of consumers as well as competitors and the general public. Needless to say, frivolous and vexatious complaints are expressly excluded from consideration.
Currently there is no legal framework for to regulate advertising standards in India. FSS still has not come up with regulation but they are in progress. But “code for self-regulation in Advertising (ASCI Code)” created by Advertising Standards Council of India (ASCI) widely accepted by the individuals and corporates because of wide industrial consultation. The purpose of this code is to control the content of advertisement and not to hamper the sale of products which may found offensive. ASCI Code will be guiding only to the Advertisers and Advertising agencies and media. The ASCI Code makes it clear that it does not seek to replace the other legal provisions that might affect advertising. Its purpose is only to complement such laws.
Advertising Standard Council of India and Food Safety and Standards Authority of India are working to regulate food and beverage advertisement in India. FSS authority is heading towards making mandatory to submit scientific proof of claims before advertising. Failing which may lead to heavy penalties and ban of article of food. It is mandatory to taken care of illiterate persons as well. Because of simple reason that an average rural person may not good enough to read and understand the nutritional information on the pack, but he can see and hear claims made on the television.
On October 6, 2009 FSS authority of India came with the concept note on guidelines to the “Code of self-regulation in Food Advertisement”(COSRFA) . The definition of the Directive suggests that any commercial communication by a Food Business Operator to the public other than through a label which is published or broadcast or disseminated using or distributed in any medium in India for payment or other valuable consideration to promote directly or indirectly the sale and consumption of food and beverages in any manner. One of the main objective of FSS Act is that laying down science based standards for articles of food and to regulate food business . The same has been taken into account in the COSRFA. A food Business Operator (FBO) has the freedom to claim the quality of food. But that should have a strong and genuine scientific basis. The claim made by the FBO must be understood by the average consumer, acting reasonably and able to interpret health or nutrition claims and the same must not mislead consumers as encouraging excessive consumption of particular food.
Another important factor need to be consider is this ‘age group of an Audience’ different class of people like urban people, rural people, literate people, illiterate people, and children etc., FBO should not misuse the lack of knowledge, expertise or experience and always obligated to provides truthful informations.
On July 2010, 7 food majors pledged their commitment on responsibility of food advertisement and market to children. This is the first time food business operator has come up with such a unique self-regulatory compliance in India. The main purpose of this self-regulation is for commitment to child health and marketing of children’s products. The reason is being driven by the increasing focus on obesity in children and allegations on unlimited consumption of fast food and drinks are some of the factors leading to it.
According to regulatory guidelines of these companies cannot advertise food and beverage products to children under 12 years in television, print or online, with the internet, except for products that meet specific nutrient criteria based on scientific evidence and dietary recommendations. For this pledge, “advertising to children under 12 years” means advertising to media audiences where at least half are children under the age of 12. The reason may be fixing the age bar to avoid capability of decision making of children. As per contract the children’s may not capable of reasonable decision making for their choice up to the age 18.
The following table , will give an idea about some renowned brands and how their products violates the section 24 and provisions of FSS (Packaging and Labelling) Regulation, 2011.
S. No. Name of the product Details of violations for which prosecution cases are filed under Section 53 of FSS Act, 2006
COMPLAN The claim on the advertisement of the product that one can grow two times after taking Complan is misleading and violates Section 24 of FSS Act, 2006.
COMPLAN
MEMORY The declaration, viz;
(i) Complan with Memory chargers,
(ii) 5 Brain chargers,
(iii) helps to improve memory
are misleading and violates Section 24 of FSS Act, 2006.
The product label shows the pictures of students with books which will mislead the public that after taking this health drink they will become good in studies.
BOOST The claim that ‘Boost provides 3 times more stamina than sadharan chocolate drink’ is misleading and violates Section24of FSS Act, 2006. The producer has not submitted any specific study on this product to substantiate their claims.
HORLICKS The claim on the advertisement of that after taking Horlicks, children become ‘taller, stronger, sharper’ which is misleading and deceptive in nature. It violates Section 24 of FSS Act, 2006.
EMAMI-
HEALTHY
AND TASTY
SOYABEAN OIL
The label contains a logo/picture in which it is written ‘7 stage European refining technology, ‘Suraksha Shakti’ which are violating Clause 2.3.1.5. of FSS (Packing and Labelling) Regulations, 2011.
SAFFOLA The use of heart symbol and the claim ‘the heart of a healthy family’; Saffola encourages you and your family to take care of your heart by using less oil and low saturated fat diet, and ‘use of word losorb technology’ etc. on the advertisement are misleading in nature.
ENGINE MUSTARD
OIL Claims like ‘health and vigour’ and ‘cholesterol 0g’ on the advertisement are misleading in nature
KELLOGS
SPECIAL K:
The claim that ‘research shows that people, who eat low fat breakfast like Kellogg’s Special K, tend to be slimmer than those who don’t’
is misleading and deceptive in nature.
BRITANNIA
NUTRICHOICE
BISCUITS
The claims on advertisements like:
1. No added sugar
2. Complex carbohydrates
3. Diabetic friendly
are misleading ad violates Section 24 of FSS Act, 2006.
NUTRILITE Claims like :
‘ if you are not taking a truly adequate and well balanced diet the nutrilite daily may be convenient once a day choice for supplemental nutrients you have been looking for’
‘Each tablet supplies 13 vitamins, 11 minerals and phytofactors plant compound from nutrilite’s exclusive plant concentrate. Nutrilite exclusive nutria lock makes tablet easier to swallow’
-are misleading and deceptive in nature.
BRITANNIA VITA
MARIE
Claims like :
1. Heart friendly
2. Helps reduce cholesterol
are misleading as per section 24 of FSS Act, 2006.
According to the article the study found that the FBO’s scientific study report does not contain important truth about the results and mislead the consumer. An analysis conducted by the Indian Academy of Pediatrics reveals the fact regarding the food of the child “Pediasure” reveals that:
‘As regard the advertisement of the product ‘Pediasure’ in the print and electronic media , , the information brochure provided to the medical practitioners, and the labelling information on the product tin, the manufacturer (Abbott nutrition) makes following health claims about the product: scientifically formulated to provide complete and balanced nutrition; clinically proven to provide catch-up growth; clinically proven to reduce sick days; supports brain development; and, enhances height, weight and immunity.
The manufacturer quotes some studies in support of these claims. An analysis of these studies reveals that out of the four quoted studies:
‘ Three studies, apart from having sub-optimum study designs, involved an explicit conflict of interest as Abbott or Ross company employees are investigators in these studies , (the manufacturer has not disclosed this fact in the advertisements, product information for medical professionals and product labels).
‘ The fourth one dealt with the relative contribution of growth deficiency and psychosocial factors to cognitive development in toddlers with infantile anorexia and has no reference to the product ‘ direct or indirect. Still quoted as “supports brain development”.
Thus, it is amply clear that in spite of a regulatory mechanism in place to look into the issue of health claims in our country, multinational nutrition companies are openly flouting the rules. This is high time that regulatory bodies should take appropriate actions to stop misleading health claims. Indian Academy of ‘Pediatrics’ should take a lead in highlighting such issues as its constitution mandates it to act as an advocate of the children of this country.’
5.2.3.2 Misleading advertisement and false representation
Any statement which is not true either because it hides acts which are important or suggests falsehood would be a false statement. Similarly, where statements given in such a phraseology or context may give rise to two meanings, one of which is false, would be misleading. Both are sought to be covered under this clause. For the purpose of this clause, it is not necessary that the person making the statement knows that the statement is false.
5.2.3.3 Corrective advertisement
In re Parle Beverages Pvt. Ltd., the commission has given direction to respondent that they will have to issue corrective advertisement in as many newspaper as in which the impugned advertisement was issued so that the injury caused to the pubic be reversed. There is no provision in the MRTP Act or seeking prior approval of the commission as to the contents of advertisement, which may be issued by a business concern for the promotion of the sales of its products .
In re Hindustan Proteins Ltd., respondents marketed product known as “Uncle Chipps ” with the representation that these chips contain 15% less fat than the standard wafers and this constituted an unfair trade practice under section 36A (1)(i) and (iv) of MRTP Act. A comparison with what has been described by the respondent as standard wafers is itself misleading, because admittedly there are no such standard wafers. If a consumer is misled into believing that the goods marketed by the respondent contain lesser fat than the wafers which are called standard wafers than such an unfair trade practices must be held to be prejudicial to the public interest. In such a case, the consumer is lulled in to believing that he is consuming a product which is less harmful and has more benefits than the standard product of this type. Respondent was directed to cease and refrain from such representation.
In re keep Fit Foods Pvt. Ltd., engaged in sale of wheat flour under the name ‘Good Health’ laudatory references on the nutritious quality and contents of their products (e.g., Enriched with Proteins, Vitamins and Minerals, so every puri, roti, paratha is extra nutritious; with protein that helps build up body and muscles; vitamins that are so good for all round health; and minerals that keeps him going strong etc. etc.) without disclosing the names of various constituents and their ration to the total weight, particularly when many chemicals like Niacin, Thiamine, Riboflavin, Calcium Carbonate, Ferrous Sulphate, Soyabean atta and vitamins etc. are claimed to have been added to normal wheat flour, was a clear case of misrepresentation.
“The false representation in cases of service that it is of a particular standard, quality or quality. If a hotelier advertises that the services therein are of comparable level, quality or quality available in a 5 star hotel, it would be a misrepresentation if in fact the service provided does not correspond to 5 star hotels.’
5.2.4 Unfair Trade Practice
The reference of this term is taken form Section 24. The term not defined in the FSS Act, 2006. It is the obligation of the seller if promoted or otherwise represents, it must give truthful information. This obligation also requires that the representation must avoid half-truths. Sometimes, a statement may be literally true, but can be misleading. An advertisement maybe misleading because the advertisements are composed or purposely printed in such a way to mislead the consumers. A representation containing the effect of misleading the consumer by using the tricky language. A related issue is the obvious exaggeration or ‘puffery’. Regulation does not generally prohibit puffery because it is an integral part of the sale since the beginning of time. Some examples of puffery might be:
‘this model is 2 ?? times better than last year’s model’
‘you will have the ring of confidence if you use this product’
‘our restaurant is famous for serving the best food in town’ or
‘freshest taste ever’.
These types of representations are vague or absurd or obviously an exaggeration. On one hand this type of puffery helps to promote the business and the comparative will destructive to consumer confidence and individual business. For the purpose of preventing or prevent vigorous competition and aggressive advertising. For example, the detailed comparative advertising can be a very effective tool to inform consumers of new and better buying opportunities. As long as the words should not mislead the consumers. The means by which unfair trade practices committed are as varied as the number of products and services in a market, but of course the favorites have stood the test of time:
Those are packaging and labelling, in-store advertising, sales talks, testimonials by trusted or influential people, for example celebrities, experts, ‘satisfied consumers’ advertising in print, on radio and TV.
The reason is obvious, it is to influence the consumer to buy something he / she will not otherwise buy, pay more for the product / service or otherwise change the form of a store or consumer form one shop or a product / service to another. The opportunity arises most often at the point of sale or sales approach, for example by referring. As a generalization of misrepresentation at point of sale are more likely to be on the characteristics of goods or services that the consumer cannot easily determine for him / herself. Because advertising is often perceived from goods and series can affect almost any characteristic of a good or service. Prohibitions on Unfair trade practices are just one form of regulatory response to consumer problems in the market place. Regulatory responses include (but not limited to):
mandatory performance standards including product safety, technical performance (for example efficiency), packaging (for example specified units of weight, size or other important characteristics)
mandatory information provision requirements, for example pricing, quantity, quality, origin or ingredients
mandatory minimum qualifications for the provision of certain goods or services (often founding in licensing regulations)
Prohibition on very specific conduct, for example not selling food past it ‘used by date’.
Competition law (Yes I’ve included it here because we should remind ourselves that the market based consumer solutions flowing from competition often produces the fastest and most comprehensive consumer outcomes.)
5.2.5 Advertisement and unfair trade practices
In director General of Investigation and Registration v. Investwell Publishers (P) Ltd. , the commission observed that there are five necessary ingredients of an unfair trade practices as per section 36A of MRTP Act. These are:
There must be a ‘trade practice’ within the meaning of section 2(u) of the MRTP Act;
The trade practice must be employed for the purpose of promoting sale, use, supply of any goods or the provision of any services; The trade practice should fall within the ambit of one or more of the categories enumerated in the section; The trade practices should cause loss or injury to the consumers of goods or services; and Additionally, the trade practices should involve making a statement whether orally or in writing or by visible representation.
It may be noted that after amendment of this section by MRTP (Amendment) Act, 1991, it is no more necessary to prove loss or injury to the consumer.
In addition to unfair trade practices are widespread in India, another large area covering most of the above areas are where UTPs are widespread and flourishing is the arena of misleading advertisements. The influence of advertisements on consumer choice is undeniable. Advertisements play an important role in gaining undivided attention of target audience, making them interested in the offering, creating desire for the products and services and help in brand building and creating the image. It is this fact that makes it imperative that advertising must be fair and truthful. Misleading and false advertisements are not just unethical; they distort competition and of course, consumer choice. An advertisement is called deceptive when it misleads people, alters the reality and affects buying behaviours. False and misleading advertisements in fact violate several basic rights of consumers: the right to information, the right to choice, the right to be protected against unsafe goods and services as well as unfair trade practices.
Consumers are misled by advertisements in various forms. In general, the material facts, the actual terms and conditions of the Offer are hidden in the fine print. Some of the unacceptable use of disclaimers and small print include conditions in obscure locations of the advertisement or text that is too small or text flashed on the screen for a moment or voiceovers that are too quick or too quiet.
Unfair Trade Practices are not limited to positive and significant representations. Sometimes consumers can be misled by the way things are said (eg: fine print) or what is not said (i.e. misleading by silence). Businesses may use disclaimers in their advertising (such as ‘conditions apply’ or asterisks) as long as they are accurate, clear and highly visible. To avoid misleading statement as asterisks and fine print must be large enough to be part of the general public perception of advertising. It is not acceptable for them important facts’the real terms and conditions of the offer’are hidden in fine print. The advertiser must clearly draw public attention to significant terms and conditions. Some examples of unacceptable use of disclaimers and fine print include: 1. conditions in obscure locations of the advertisement; 2. text that is too small; 3. text flashed on screen for only a moment; 4. Voice-overs that are too quick or too quiet.
Generally unfair trade practices do not impose on businesses a positive obligation on companies to disclose. However, there may be circumstances where the seller has put the buyer in a position where he / she knows that the consumer has been misled, but does nothing to dispel this misunderstanding. The so-called “manufacture confusion” increases from becoming a problem. This is illustrated in the rapid expansion options contact mobile phone. In many countries, the number of options and their complexity is such that many consumers become confused and respond to information overload ignoring cost information which should be at the center of their purchasing decisions. My own observations lead me to conclude that this sector is not yet adequately addressed by the legislature.
The advertisements can be misleading in many ways, such as:
5.2.5.1 Advertising contents carrying inappropriate information
The use of untrue testimonials to convince buyers, citing misleading prices or disparage a competitor’s product in a misleading way are some examples of misleading advertisements.
5.2.5.2 Advertising contents with safety issues
Sometimes companies advertise products highlighting health cures and proprietary food of dubious effectiveness and health gadgets unknown values do not worry about the impact it can have on the health of the user. These products pose a health hazard grave. Tempted by such an advertisement, claiming to increase the height of a person, Nadiya, a student of class VIII was admitted to the hospital for surgery on July 24, 1996, for increasing her height. The surgery was performed and a ring fixator was fixed on her legs which was to be adjusted every six hours. However, after the surgery, ironically, the left leg was shorter by half an inch than the right leg and, therefore, Nadiya could not walk and was bedridden till March 1998. The Commission held the hospital and the doctors negligent and deficient in their services and directed them to pay Rs. 5 lakh.
5.2.5.3 Advertisements violating consumer’s right to choice
When material facts which were likely to influence the buying decision are not disclosed, the advertisement becomes deceptive. For example, in several advertisements it is stated that “conditions apply”, but these conditions are not specified. However the advertisement was subject to conditions which were mentioned as footnote in small font, namely, prices were valid in Delhi and NCR under exchange only and actual products may differ from those indicated in the offer. Such advertisements mislead the consumer by concealing important information from them.
5.2.5.4 Advertisements offering sale, bargain price or free gifts with no intention to comply with such offer
When a company allows the publication of any advertisement whether in any newspaper or otherwise, for the sale or supply to a market price that is not intended to be offered for sale or supply at market prices or offers gifts , price, etc., with the intention not providing them as offered or the company creates the impression that something is being given or offered free of charge when it is fully or partly covered by the amount charged in the transaction as a whole, such company engages in unfair trade practices.
The arena of misleading advertisement is largely unregulated due to the absence of specific legislation against unfair trade practices part. The process of regulating the advertisement can be divided into three areas:
5.2.5.4.1 Self-regulation by the advertising industry
This self-regulation is provided by the advertisers themselves in a broader perspective, as their duty towards consumers. Various organizations are involved in this self-regulation, including: (a) agencies within an individual company, eg. Mudra an advertising agency of Reliance has its own code of practice; (b) advertising trade associations such as ASCI, Advertising Association of India, Indian Newspaper Society, Press Council of India (PCI), Prasar Bharati, etc; (c) Individual media and media group such as All India Radio Code for commercial advertising, which although per se is only persuasive and not binding.
However, it should be noted that the decision of the self-regulating agencies have suggestive value only and are not binding. Also organizations such as the ASCI, PCI, beyond a point, will always remain pro-advertising agencies and would not want to harm its own industry by taking strong measures and cut down on the revenues coming to the advertising agency by such advertisements. Similar views were echoed by the President Consumer India during CUTS’ meeting with her.
In addition to this, the former head of the Department of consumers in the state of West Bengal, who also worked in the field of unfair trade practices, especially misleading advertisements for many years and now wants to face the media agencies/newspaper groups directly, informed CUTS during a meeting that newspaper groups are very strong and influential and it is difficult to tackle them or raise a voice against them. In addition, an important member of Consumer Affairs, Department of Consumer Affairs, Ministry of Consumer Affairs, Food and Public Distribution believes that ASCI has no adequate consumer representation. In addition, no government agency is also working in this field.
5.2.5.4.2 Externally imposed regulations either by the aggrieved party themselves or by the policing authorities
This regulation is done by consumers who either individually or collectively seek action against the defaulting advertisers either by writing to companies which carry the deceptive aadvertisement or through consumer organisations. The success rate of this mode is very low and most of the time upon failure, the consumer takes the legal route.
Offences and penalties
1. As per section 57 penalty or possessing adulterant, whoever holding adulterant by himself or on behalf of any other, imports or manufactures for sale, stores, sells or distribute any adulterant shall be liable for penalty of not exceeding 2 lakhs if such adulterant in not injurious to health and not exceeding 10 lakhs if such adulterant is injurious to health.
2. As per section 58, if no specific penalty was prescribed under this act for the violation of this act shall be liable to pay fine that may extend to 2 lakhs.