Editor's note: Alexandra Ableitner practices in McNees Wallace & Nurick LLC’s Food & Beverage and Corporate & Tax groups.
Consumers seem to be more eager than ever to know what they are eating and what journey it traveled to move from farm to table.
In this era of authenticity, artificial is out, organic is in.
The heightened scrutiny has led to a new federal law requiring manufacturers to disclose the use of GMOs, or “genetically modified organisms.” Beginning in the 1990s, GMOs have been used to help produce the greatest quantities of food at the lowest price. These organisms can help crops resist viruses, bacteria and herbicides and improve their nutritional value. Consider bovine growth hormone, which helps cows produce more milk. Corn, potatoes, soybeans, bananas, salmon and rice are other foods that are likely to contain GMOs.
Reacting to consumer concerns about artificial ingredients and their possible long-term impact on public health and the environment, President Obama signed the National Bioengineered Food Disclosure Law in July, after it received bipartisan congressional support. The law will soon require food manufacturers to identify when bioengineered ingredients and processes are used to make food and drink, so consumers can decide for themselves and their families what they care to eat.
The law also gives the U.S. Department of Agriculture two years from the date of enactment to develop regulations, meaning full implementation will not occur until July 2018. Though it is unclear at this point how many items will require labels, many products on supermarket shelves will probably be sporting a new GMO label soon. In fact, many companies are already labeling their products voluntarily.
Some exceptions to the labeling requirements are currently in the law -- including meat, poultry, dairy and eggs from animals that eat genetically-modified feed -- but are otherwise unmodified. In addition, the new regulations will only cover food for human consumption.
The USDA also must define “small food manufacturers’’ and give those companies a grace period of at least a year to comply. Additionally, the new regulations will not impact certified organic products, which are already prohibited from containing GMOs.
While many questions remain as the regulatory process continues to unfold, here are three steps that food manufacturers can take now to prepare:
1. Keep track of all ingredient sources
Cast an even more vigilant eye on the quality of your food sources and the type of supply you purchase. Try to secure a certificate of analysis or a warranty from suppliers. This move might require a re-examination of existing contracts, or even a re-negotiation. The sooner producers start to track ingredients, the better.
2. Look at the indemnification language with suppliers
If a supplier vouches for a bioengineering-free production process but this representation turns out to be untrue, food producers should find out if you can be indemnified. It is important that you protect yourselves from charges of false labeling and the cost of recalls.
3. Set up testing
Most food manufacturers already have testing programs in place for ingredients, but food should now be analyzed for bioengineered additives in particular.
One positive benefit of the federal law is that uniform national labeling standards will govern the disclosure of GMOs. Without the law, food producers could have faced a confusing patchwork of state packaging mandates that would have forced them to decide state-by-state what labeling they must provide. In fact, Vermont’s move to require GMO labels triggered the national effort to ensure standardization, uniformity, fairness and cost-effectiveness.
The regulations are expected to give companies some latitude in deciding how to disclose GMO information, with a menu of options that could include the posting of a toll-free phone number, a disclosure statement, a new USDA-developed symbol, or perhaps online options.
Before any regulations can include website disclosure options, however, the law instructs the USDA to conduct a study on whether consumers could easily access electronic information on packaging and if, indeed, they would be likely to do so. The concern is that high-tech features will not benefit low-income or elderly shoppers, who may be unable to readily access GMO information on computers or smartphones.
The agency’s Agriculture and Marketing Service will oversee the study. Just weeks ago, it invited research firms to bid on the proposal. The agency expects the study to be completed by next May and plans to include opportunities for public input and an examination of ways to minimize compliance costs.
As for what will qualify as a GMO-containing food, the USDA now defines the term in this way:
The term “bioengineered” refers to a food that contains genetic material that has been modified through in vitro recombinant deoxyribonucleic acid (DNA) techniques; and for which the modification could not otherwise be obtained through conventional breeding or found in nature.
In writing the new regulations, the USDA will determine whether an expansion or change of this definition is needed and, most importantly for manufacturers, how much GMO material in a product will trigger labeling requirements.
A long time coming
Consumer concerns over the use of GMOs have been building steadily since 1994, when the first GMO product hit the shelves—a tomato that is slower to ripen, thus extending its shelf life. More than 20 countries have banned GMOs, and double that number have passed food-labeling laws requiring some level of disclosure to consumers.
From its infancy, the legislation prompted the formation of a broad coalition of farmers, scientists and food merchant groups -- often pitted against consumer groups -- with lawmakers billing the conversation as the most important food and agricultural policy discussion of the past quarter century.
The law passed in July after much debate, despite the likelihood that labeling would serve only to drive unsubstantiated fears of GMOs and hike food prices without improving consumer health and safety.
Already, cereal makers such as General Mills and pretzel and potato chip packagers are placing “Non-GMO” labels on their products. The time is ripe to take a good look at your supply contracts and brace yourself for further legislation on labels.