Retailers and manufacturers should be wary of going along with what could be illegal proposals, says Charles Livingstone
In February, the Scottish government published the snappily titled Preventing Overweight and Obesity in Scotland: A Route Map Towards Healthy Weight. Its proposals include co-operating with retailers and/or producers on issues such as portion sizes, stocking policies, labelling and marketing, and are backed by the threat of legislative action if voluntary approaches "do not achieve sufficient progress towards a healthier balance in the meals, food and drinks sold".
So what approach should retailers and producers take towards these proposals? Since it may be unlawful for the Scottish government to pursue them, unlawful for the Scottish parliament to impose them and perhaps even unlawful for businesses to adopt them voluntarily, caution would be advisable.
There are at least three areas of law that could be a bar to the proposals. The Scotland Act 1998 limits the Scottish parliament's power to make laws, and the Scottish government's power to do anything else, by specifying that certain issues can only be dealt with at UK level (these issues are "reserved" to the UK parliament and government). If the Scottish parliament or government stray into these reserved issues, the courts can invalidate the resulting legislation or government action.
One of the reserved issues is "regulation of the sale and supply of goods and services to consumers". It seems likely that at least some of the Scottish government's proposals could fall into that category, including: reducing the ratio of "energy-dense" (ie high-calorie) to "lower energy" (ie lower-calorie/smaller portion size) products stocked by supermarkets and c-stores; standardising portion sizes in ready meals and restaurants; and "targeting" all promotional activity (including price promotions and product placement) towards "incentivising eating for a healthy weight".
EU law generally prohibits barriers to the free movement of goods between EU countries. The Route Map's proposals on standardised portion sizes and labelling requirements (ie prioritising health messages) could, if made compulsory, constitute such barriers foreign producers could only sell in Scotland if they complied with the relevant size and labelling requirements. Readers familiar with the ongoing difficulties over the use of traffic-light labelling will appreciate how complex EU law in this area can be.
Businesses familiar with competition law will know that co-operation between competitors (including via trade associations) can potentially breach the Competition Act 1998, and that can result in large fines.
Since this could include co-operation on issues such as stocking policies, portion sizes, labelling and marketing, retailers and producers must be wary of agreeing with the Scottish government to voluntarily limit their scope to compete with each other in these areas.
That such agreements were encouraged by government would not prevent them breaching competition law.
These concerns may leave food and drink retailers and producers wondering how best to react to the Scottish government's proposals. Given the potential risks involved in adopting them voluntarily, and the possible invalidity of any attempt to make them compulsory, businesses should seek advice.
Charles Livingstone is an associate in public law at Brodies LLP.
In February, the Scottish government published the snappily titled Preventing Overweight and Obesity in Scotland: A Route Map Towards Healthy Weight. Its proposals include co-operating with retailers and/or producers on issues such as portion sizes, stocking policies, labelling and marketing, and are backed by the threat of legislative action if voluntary approaches "do not achieve sufficient progress towards a healthier balance in the meals, food and drinks sold".
So what approach should retailers and producers take towards these proposals? Since it may be unlawful for the Scottish government to pursue them, unlawful for the Scottish parliament to impose them and perhaps even unlawful for businesses to adopt them voluntarily, caution would be advisable.
There are at least three areas of law that could be a bar to the proposals. The Scotland Act 1998 limits the Scottish parliament's power to make laws, and the Scottish government's power to do anything else, by specifying that certain issues can only be dealt with at UK level (these issues are "reserved" to the UK parliament and government). If the Scottish parliament or government stray into these reserved issues, the courts can invalidate the resulting legislation or government action.
One of the reserved issues is "regulation of the sale and supply of goods and services to consumers". It seems likely that at least some of the Scottish government's proposals could fall into that category, including: reducing the ratio of "energy-dense" (ie high-calorie) to "lower energy" (ie lower-calorie/smaller portion size) products stocked by supermarkets and c-stores; standardising portion sizes in ready meals and restaurants; and "targeting" all promotional activity (including price promotions and product placement) towards "incentivising eating for a healthy weight".
EU law generally prohibits barriers to the free movement of goods between EU countries. The Route Map's proposals on standardised portion sizes and labelling requirements (ie prioritising health messages) could, if made compulsory, constitute such barriers foreign producers could only sell in Scotland if they complied with the relevant size and labelling requirements. Readers familiar with the ongoing difficulties over the use of traffic-light labelling will appreciate how complex EU law in this area can be.
Businesses familiar with competition law will know that co-operation between competitors (including via trade associations) can potentially breach the Competition Act 1998, and that can result in large fines.
Since this could include co-operation on issues such as stocking policies, portion sizes, labelling and marketing, retailers and producers must be wary of agreeing with the Scottish government to voluntarily limit their scope to compete with each other in these areas.
That such agreements were encouraged by government would not prevent them breaching competition law.
These concerns may leave food and drink retailers and producers wondering how best to react to the Scottish government's proposals. Given the potential risks involved in adopting them voluntarily, and the possible invalidity of any attempt to make them compulsory, businesses should seek advice.
Charles Livingstone is an associate in public law at Brodies LLP.
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