'Australian made' labels are about to get a lot more specific.
Consumers increasingly want to know the characteristics of the food products they purchase. On 31 March 2016, consumer affairs ministers agreed on reforms which will see ‘Country of Origin’ labelling for food regulated through a new mandatory Information Standard. This Standard will be regulated through the Australian Consumer Law, rather than through the Australia New Zealand Food Standards Code.
These reforms will commence 1 July 2016, with a two year period given to businesses to change labels to the new format. Products with previously compliant labels will still be allowed to be sold if the labels were attached before the end of transition period.
The predominant change that consumers will notice is the introduction of the bar chart and text statement to show the proportion of Australian ingredients.
A summary of the different claims available appear below:
Grown / produced in Australia
This is a premium claim, meaning that all ingredients are Australian and all major processing occurred in Australia.
Where food is exported and processed overseas without substantial transformation (see below), and then reimported, it is mandatory to state what processing occurred overseas.
Made in Australia
Food can be described as being ‘made’ in the country where it underwent its last substantial transformation. This is where the end product becomes fundamentally different from its ingredients. Imported ingredients subject to minor processes in Australia, such as slicing, freezing or reconstituting, cannot be said to have been substantially transformed. There is also currently a requirement that 50 per cent or more of the total cost of producing the goods is attributable to production processes that occurred in Australia.
However potential amendments to these ‘safe harbour’ defences found in the Australian Consumer Law are currently in the works. These include making the meaning of ‘substantial transformation’ clearer and better aligned with similar national and international concepts, and removing the 50 per cent production cost test, which has been cited as difficult for businesses to apply given constant price fluctuations.
Where a product does not contain all Australian ingredients, the percentage of Australian ingredients must be shown on the bar chart and stated in text.
Businesses may elect to indicate the origin of specific ingredients.
Packed in Australia
If food in a package was grown, produced or made in one country but packed in another, the label must still clearly state the country where it was grown, produced or made.
Where food in a package comes from multiple origins, it is not necessary to identify each country, but it is necessary to say it was grown, produced or made from imported ingredients. Stating place of packaging is optional.
If the food was packed in Australia, the label must still include the bar chart and text. The kangaroo logo cannot be used.
Wholly imported products
Imported products will continue to be required to be labelled with a country of origin.
However businesses are still able to indicate the presence of Australian ingredients, although as above, they will not be entitled to use the kangaroo logo.
Varying ingredient source
Where ingredient sources vary, labels allow an average calculated on a one, two or three year period that concluded within the last two years to be used. However it is mandatory to provide the option for more consumer information.
If you have any further questions or require expert advice, please don't hesitate to contact us.