Fighting Food Fraud: Is the Law Fit for Purpose? Maree Gallagher Food Lawyer, Dublin 25 June 2014
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1 Fighting Food Fraud: Is the Law Fit for Purpose? Maree Gallagher Food Lawyer, Dublin 25 June 2014
2 What is Food Fraud? Currently no EU law definition of the term Deliberately placing on the market, for financial gain, foods that are falsely described or otherwise intended to deceive the consumer UK Food Fraud Task Force 1
3 What is Food Fraud? Different types of food fraud include adulteration counterfeiting substitution deliberate mislabeling of foodstuffs Consumers are entitled to receive adequate, safe, sound and wholesome food 2
4 Food Fraud Is a Crime 3
5 The problem is. Detection Deterrents 4
6 Top 10 foods susceptible to fraud 1. Olive Oil 2. Fish 3. Organic Foods 4. Milk 5. Grains 6. Honey / Maple Syrup 7. Coffee / Tea 8. Spices 9. Wine 10. Fruit Juices 5
7 Vino Tinto // Vino Finto (Red Wine // Fake Wine) October 2013 Members of an Italian family were arrested for selling 400 bottles of cheap Italian wine as fabulously expensive Romanee-Conti from Burgundy, netting well over $2 million in the scam May Italy 30,000 bottles of cheap table wine falsely labelled as prized Brunello, Chianti Classico and other premium wines - US and elsewhere Many victims/purchasers don t want to co-operate in the investigation; they would prefer to sell their fake wines rather than lose money 6
8 The Law While the general requirements of EU food law include the aim to prevent fraudulent or deceptive practices; the adulteration of food; and any other practices which may mislead the consumer, the focus since mid 1990s has primarily been on food safety FBOs legal duty to ensure food is safe, and they are subject to hygiene, labelling and traceability requirements Labelling law - consumers must not be misled. It also requires ia. that, in general ingredients are listed in descending order of weight 7
9 Enforcement The responsibility for enforcing food law lies with EU Member States who carry out official controls of the supply chain Duty of national authorities monitor and verify that the relevant requirements are effectively applied, complied with and enforced across the EU Problem is there are differing approaches across the EU to the detection and deterrence of food fraud» Detection» Deterrents 8
10 Horsemeat Horse DNA first detected in early 2013 by Irish FSAI in frozen beef burgers. It was subsequently found in beef-labelled ready meals in the UK and throughout Europe. Some products were found to contain up to 100% horse DNA 9
11 Was it legally unsafe? Tests carried out in the wake of the scandal revealed that public health was not at risk and that this was a case of food fraud rather than food safety However, EU law states food shall be deemed to be unsafe if it is considered to be: (a) injurious to health; (b) unfit for human consumption Would a consumer consider a horsemeat burger labelled as beef to be unfit for consumption? Many did.. 10
12 Lessons Learned Complexity of the meat supply chain and the need to adapt official controls to meet this reality Extensive outsourcing and the widespread involvement of intermediaries revealed Need to improve cross-border cooperation among national enforcement authorities In anti-food fraud activities the need to mobilise not only food inspection services but also other law enforcement agencies (e.g. police, customs) and judicial authorities 12
13 EU Action - March 2013 Commission 5-point Action Plan to address shortcoming identified in Europe s food supply chain: 1. Coordination: Encourage cooperation between enforcement authorities and ensuring the rapid exchange on information on intentional violation of food chain rules, promoting the involvement of Europol in investigations; 2. Testing Programme: The Commission recommended and co-financed a EU-wide testing program to assess the scale of the horsemeat issue; 3. Horse Passport: Tighter controls on horse passports and a proposal to transfer the issuing to a sole competent authority in each Member States were proposed after weaknesses in the system were highlighted by the fraud 4. Financial Penalties: Proposal that financial penalties for intentional violations of food chain rules are at a sufficiently dissuasive level i.e. higher than the economic gain expected from the fraud. 5. Origin labelling: Plans to introduce more effective labelling rules and exploring the extension of mandatory origin labelling rules. 13
14 EU Action July 2013 EU Food Fraud Network comprising of representatives from the Commission and Member States (plus Iceland, Norway and Switzerland): national contact points designated by each Member State to ensure cross-border cooperation forum for discussion on the coordination and prioritisation of action at EU level on food fraud matters Development of a dedicated IT tool, similar to the RASFF, which enables the members of the network to rapidly exchange information and data on potential cases of cross-border fraud 14
15 New Legislative Proposals 6 May 2013, EC proposed Reg to strengthen the agri-food chain in Europe re: food fraud, national enforcement proposed: performance of regular unannounced official controls directed at identifying intentional violations impose financial penalties to offset the economic advantage sought by the perpetrator of the violation Proposal would give Commission more powers to: require Member States to carry out controls and tests within a coordinated control plan of limited duration to ascertain the extent of specific shortcomings along the food chain; and establish permanent specific control requirements in relation to specific sectors and/or newly identified risks which emerge along the food chain or which emerge from new patterns of production or consumption of food Commission study 2014 on the legal framework that currently governs the fight against fraudulent and deceptive practices 15
16 Is enough being done? Lack of prosecutions in relation to horsemeat scandal demonstrate that the current enforcement of food law is not fit for purpose Effectiveness of coordinated official controls, increased random testing and tougher financial penalties remains to be seen What can be done to ensure penalties are effective, proportionate and dissuasive? Look to Competition Law penalties levels of fines Need for specialist knowledge: Forensic training for law enforcers? Creation of an independent, dedicated EU Food Fraud Unit perhaps as part of FVO? 16
17
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