Country of origin labelling: friend or foe?

Last month Poland announced its plan to implement mandatory Country of Origin Labelling (COOL) for fresh potatoes, becoming the latest EU Member State to join the ranks of countries like Italy, Finland and France that have implemented mandatory COOL schemes for a number of products. This follows a trend that some perceive to be a logical reaction to consumers’ increasing demands for information, but which others are warning might translate into trade distorting measures.

COOL is the practice of indicating the country of origin of a product in its label. This, in theory, is quite a simple concept, but in practice determining a product’s origin is not an easy task. Processed products represent the clearest example of the complexities behind establishing the provenance of a product, as different ingredients often have different geographical origins and steps of the food supply chain might take place in different countries. This is not the only controversy surrounding this type of labelling though.

COOL schemes are seen by some as a positive step toward better information to consumers that can give companies a competitive advantage in an increasingly competitive global market. But they are viewed by others as trade restrictive instruments. Defenders argue that this information is demanded by consumers, as they are increasingly interested in having a better understanding of the products they buy and the composition and processes behind them. They also claim that these measures are a good way to address food safety and quality concerns. But several trade experts are warning about the consequences of COOL. According to them, this information is a protectionist instrument used by national governments to shelter national products from foreign products’ competition by pressuring consumers to buy local. In the EU, they warn, these measures may have a significant impact in the functioning of the single market.

Origin labelling is mandatory in the EU for certain foods like fresh fruit and vegetables, fish and seafood, honey, olive oil, eggs, beef (and beef products) and unprocessed meat of swine, sheep, goat and poultry. According to the food information to consumers (FIC) Regulation, labelling of origin is also obligatory if customers might be misled as to the origin of a product without this information, and when the origin of a food product is given but its primary ingredient has a different origin, in which case the origin of the primary ingredient must also be indicated.

Member States may adopt additional COOL schemes for specific types or categories of foods if these are justified under protection of public health, protection of consumers, prevention of fraud or protection of industrial and commercial property rights, indications of provenance, registered designations of origin and prevention of unfair competition. Countries wanting to implement these schemes must also provide evidence of a link between the qualities of the food and its origin and of consumers attaching significant value to the provision of this information.

Eight Member States – France, Spain, Italy, Lithuania, Portugal, Greece, Finland and Romania – have implemented national mandatory COOL schemes for some products, which in most cases have been announced as two-year trials. It is important to note that a mutual-recognition clause excludes from these schemes products lawfully produced or marketed in another Member State. For most of the schemes notified, Member States have expressed their commitment to report back to the Commission at the end of the trials the impact the measures have had on the internal market. The Commission will then assess this information to study the implications of these measures.

The Commission has nevertheless repeatedly stated that a combination of voluntary schemes and the mandatory requirements set in the FIC Regulation are the best approach to COOL the EU can take. The Commission’ position stands somewhere in between countries like Italy, that has introduced mandatory COOL on pasta and rice regarding the primary ingredients (which means that the place of cultivation of the rice and wheat need to be given) without properly following the notification procedure to the Commission, and other Member States like Belgium that is pushing back against as it has seen how its milk and meat exports to France have significantly dropped since France implemented COOL for these products. The industry has also often argued against these schemes mentioning difficulties and costs associated with them, but the European Parliament and different consumer organisations are generally supportive of this type of labelling.

The lines are clearly drawn between those pushing for mandatory COOL and those opposing it. The next European Parliament Elections taking place on May 2019 and the subsequent appointment of a new college of Commissioners may set the tone to further broaden these schemes or to put stricter limits to them.