Spot the difference: Eastern Europeans say brands sell them sub-standard products

Eastern Europeans are convinced they’re being ripped off. In one of the most unusual political rows to emerge in recent years, they’ve accused multinational food and drink manufacturers of selling them sub-standard versions of well-known brands. The sense of grievance has not only persuaded some MEPs to back Eastern European consumers, but has now reached the upper echelons of the EU itself.

A study commissioned by MEP Biljana Borzan from the Croatian Food Agency in September found strawberry Activia yoghurt sold in Croatia contained less strawberry than the German product while Coca-Cola contained high fructose corn syrup. Another study by the Slovakian Agriculture Ministry found an orange drink made by the Rewe Group and sold in Slovakia did not contain any orange juice, unlike the product sold in Austria, and had more additives and stabilisers.

The list of studies goes on. In February 2015, the University of Chemistry and Technology, Prague were commissioned by another MEP, Olga Sehnalová, and reported similar findings. When the Hungarian Food Safety Authority studied 96 products in February and March this year, from Kinder Schoko-Bons to Heinz Tomato Ketchup, it reported much the same.

One perception is that Eastern European countries end up with inferior products because they are less affluent. But it’s not as straightforward as that. As Borzan’s study showed, 16 products cost more in Croatia than Germany, including a version of Hipp babyfood found to be inferior that was 54% more expensive, Nutella, 28% more expensive, and Haribo ‘Happy Cola’, unhappily enough, 39% more expensive.

Even where there were negligible differences, the same study found significant price variations. Eastern or Western Pepsi and original flavour Pringles used the same ingredients, although both were much more costly in Croatia. Pepsi was 36% more expensive and the Pringles were 110% more expensive. No explanations for the disparity has come to light.

Politicians have been quick to capitalise. Czech agriculture minister Marian Jurecka said in February that Eastern European countries were perceived as “Europe’s garbage can”. An aide to populist Hungarian prime minister Viktor Orbán chose the same month to say that dual-quality food was “the biggest scandal of the recent past”, while Bulgarian prime minster Boyko Borisov provided the most headline-friendly summation of supposed dual standards in May this year when he talked of ‘food apartheid’.

Their words are finding a ready audience. Food quality was an issue exploited by Czech prime minister designate Andrej BabiŠ at the national elections in October.

A survey by the Czech Agriculture and Food Inspection Authority (SZPI) in October and November 2015 found 88% were annoyed by the practice of brands providing products of different composition supposedly to suit local tastes, with 77% of people saying they disagreed with the narrative from brands; 51% of consumers thought the companies were explicitly trying to save money, which makes it clear why BabiŠ saw considerable political equity in positioning himself as an opponent of dual quality.

Borzan rejects the common explanation that brands regionalise their offerings. “Perhaps some products are made to suit the taste of local consumers, but then you come to the example of Hipp babyfood found not to contain omega-3 oil in Croatia, [while] German examples did have it. Who did they ask - the babies?

“Around 50% of the products were of a different quality. Some were big differences, but even the smaller ones can feel humiliating. Coca-Cola, for instance, makes use of a sweetener, but the price is the same. Activia yoghurt has more strawberries in Germany but more sugar in Croatia. That has negative effects on health.”

Since the brands print the ingredients on the packaging, they are not technically doing anything illegal, but Sehnalová takes issue with this idea, suggesting consumers do not want to spend hours in supermarkets reading labels and wondering what E450 and E452 might do if they happened to be ingested.

“Nobody stands there reading labels,” she says. “If you were to check every product you bought, you would spend ages in the shop. Consumers expect quality from branded products and that isn’t always being fulfilled. Even if producers say they are not the same product, and that we are not comparing the same thing, you need to look at the advertising and at the packaging. The consumers see them as the same.”

This becomes even more simple in Biljana Borzan’s striking formulation. “You don’t have both products in front of you,” she adds, simply. “You don’t have a Croatian one and an Austrian one. Declaring the ingredients is fine, but you don’t know that there is a better product in Austria and that you’re being sold the inferior version.”

The idea that products from different countries are allowed to seem the same leads back to the EU’s Unfair Commercial Practices Directive. All manufacturers of products in the EU must abide by this legislation, which provides for member states to act against companies that use marketing to unfairly align products that appear similar but contain inherent differences.

A commercial practice is misleading if it ‘deceives or is likely to deceive the average consumer, even if the information is factually correct… and causes or is likely to cause him to take a transactional decision he would not have taken otherwise’.

Such is the line EU Commissioner Vera Jourová is pursuing. “We say for the first time clearly: this is unfair commercial practice,” she told The Guardian in September. “In many cases, yes, I am convinced [the law has been broken] because there is manifest cheating.” Jourová’s vehemence even persuaded Jean-Claude Juncker to include the issue in his state of the union address on 13 September.

“There can be no second class consumers,” Juncker said. “I will not accept that in some parts of Europe people are sold food of lower quality than in other countries, despite the packaging and branding being identical.” He called for the subject to be seen as “a competition issue” and pressed for the Unfair Commercial Practices Directive to be invoked.

Not surprisingly, the brands have defended their reputation (see box). “We seem to be accused and declared guilty before anyone has made a case against us,” says Florence Ranson, the communications director of FoodDrinkEurope, the representative body of European food and drink companies.

“The labelling rules are being respected and as far as we are concerned there is nothing illegal going on. Earlier this year, the [European] Commission said that they recognised that as well, but now seem to have changed their stance.”

Ranson finds partial vindication in the methodology of some studies. The one conducted in Prague used luncheon meat made by the Tulip company of Denmark, called ‘luncheon meat’ in the Czech Republic market and, confusingly, ‘frühstückfleisch’ (or breakfast meat) in Germany. Here the similarities end, because the main ingredient in Germany is pork, and in the Czech Republic the more dubious-sounding ‘mechanically separated poultry meat’.

Many of the Eastern European studies found soft drinks manufacturers were using glucose fructose syrup to replace sugar or supplement it in drinks sold in these markets as a way of cheapening production costs

Inferior? No, says Tulip. “These are two different products for two different markets,” claims Nick Purnell, Tulip UK communications manager. “In comparing them, you’re comparing apples and oranges, because they’re two entirely different things.” A lack of understanding of the niceties of the European luncheon meat trade does not, however, invalidate all the studies completed in the various countries, especially when only minor cosmetic and linguistic differences exist between the packaging of different products.

Jourová’s spokesman Christian Wigand makes it clear that the EU does not intend to take legal action over the labelling issue. At least, not just yet. “We do not have robust scientific evidence,” he says. “Once we have the necessary evidence, companies should be given a chance to proactively address the issues. There has been constructive dialogue with food manufacturers and retailers. We have been discussing information on product differentiation and whether this goes beyond current labelling obligations.”

Recipe assimilations

Some brands have also been changing their ways. One of the most high-profile is Hipp babyfood. Following claims in the Borzan-funded study that the Croatian iteration of its rice, carrots and turkey recipe was different from the German version, it felt compelled to state that there was a 97% similarity between the range in the two countries and that the Croatian version was on sale in Germany.

However, it added: “within the scope of a continuous revision of our assortment, we have already undertaken recipe assimilations for all our national and international ranges”, claiming “very few remaining recipes have yet to be adapted and will soon be found in the trade with 100% composition all over Europe. The product Hipp Rice, Carrot, Turkey is one of them.’

Bahlsen, the company behind Choco Leibniz, in July this year also directed its factory in Poland, responsible for Central and Eastern Europe, to make the distinctive biscuits to the same recipe as the German factory. “We perceive one of the components of the globalisation process is the constantly increasing expectation towards the manufacturers that products meet the same standards,” the press release noted.

A one-day summit on dual food quality in Bratislava on 13 October suggested there has been a decisive change in the way the EU views this issue. The official statement reiterated that the European Union would make €1m funding available for the development of a harmonised testing approach led by its own Joint Research Centre, which will finally produce the ‘robust scientific evidence’ Christian Wigand wants.

Even Florence Ranson agrees. “We want valid, harmonised tests,” she says. “Our sense is that some of the tests that were done at local level either didn’t have the right methodology or weren’t comparing like with like.”

To introduce a legal metaphor, the major brands are currently out on bail, having created some considerable doubt as to their guilt, and are awaiting a date for the court hearing.

Only time will tell whether more of them, like Hipp and Bahlsen, have a get out of jail card.