Antitrust, food review

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Antitrust, cases dealt with by the Authority over the past 9 years in the food sector

The Antitrust Authority, Autorità Garante per la Concorrenza e il Mercato (AGCM), has had and still has an important role in assessing unfair business practices. In various sectors including food. The following is a review of the most prominent cases in the food sector from 2008 to 2016. Pending further action, particularly on the cases of Milk Sounding that Great Italian Food Trade has recently denounced.

2008


Moral suasion
. Action on various incorrect wording in labels and advertisements. These included ‘no harmful residues’ and ‘from the first year of age’ references that falsely suggested the qualification of a fruit juice as a food intended for early childhood, the misleading ‘fat-burning’ claim on a meal replacement bar, the ‘no hydrogenated fats’ boasted on a soft drink.

‘Approved by the Federation of Italian Pediatricians (FIMP).’ The Guarantor Authority sanctioned an operator who-after a commercial agreement with the FIMP, but in the absence of scientific evaluation of the health properties of the advertised product-boasted the claim ‘Approved by the FIMP.’ The penalty imposed was 695,000 euros for the operator and 300,000 euros for FIMP. Although an endorsement by a scientific community is abstractly possible, the indication must in any case come based on a documented medical background.

Alixir, Barilla. In the broad publicity context of the Alixir nutraceutical line, several AGMC challenges have intervened. The advertising campaign suggested that a balanced diet could not provide all the nutrients needed for well-being. Instead, proposing a daily food program that included several products from the line in question. However, the proposed health claims (e.g., ‘slows cellular aging’) were lacking in scientific backing from EFSA, as well as being unscientific in themselves.

Other profiles of unlawfulness then concerned the comparison of brand products with other common foods (whose ‘unsuitability’ was falsely alleged). The expressions ‘the secret to living your best – live longer’ were themselves considered incorrect. The Antitrust Authority imposed a fine of 200,000 euros on Barilla.

Mila, yogurt drink. The Authority has applied a fine of 100,000 euros for the use-in advertising for two yogurt drinks-of a number of unauthorized health claims. Such as ‘fat burner’, ‘facilitate attack of fat stores’, ‘intervene/help reduce absorption of fat sugars’, ‘awaken/regulate metabolism’, ‘aid weight control’, ‘slow down processes of cellular aging’, ‘neutralize free radicals, responsible for cellular aging’, ‘rejuvenate’. If only there had been even a grain of truth (!).

Serilac probiotic. The probiotic dietary supplement took advantage of comparative advertising against food products of a different nature, therefore not comparable. The advertising message also led the consumer to believe that consumption of other products could even have negative health effects. Fine imposed, 50,000 euros.

2009

Danone Danacol and Unilever ProActiv. Two yogurt drinks with phytosterols, marketed to counter hypercholesterolemia. The Antitrust Authority condemned pushy marketing that suggested that both products alone could offer a definitive solution to the problem of high LDL cholesterol (and the associated cardiovascular risk). While in reality, at most, such products can be understood as an adjunct not a substitute for appropriate drug therapy. In both cases, moreover, medical associations (in the first case the Italian Society of General Medicine, in the second the Italian Society of Cardiology) were leveraged. Penalties of 300 thousand euros and 100 thousand euros, respectively, also taking into account the partial discrepancy of the advertising communication with the relevant EFSA opinions.


Red Bull
. The AGCM went far beyond the judgment of the corresponding British authority. Stating that-beyond any assessment about the effect of caffeine and other substances on the nervous system-it is in any case incorrect and impermissible to promote the use of the beverage in dangerous situations, such as drowsy driving states. On the contrary, basic criteria of prudence suggest stopping, in case of sleepy strokes, and any different warning causes potential harm to the health and safety of consumers (in violation of the Consumer Code, Article 21.3). 80 thousand euro penalty for promotional messages that proposed Red Bull as ‘the ideal travel companion for those who travel long distances’ (‘if your eyes close and the road home seems endless, it’s time to listen to some good rhythmic music and refresh your mind with a can of Red Bull’, etc.).

2010

Pastariso, Riso Scotti. The Antitrust Authority has condemned the health claim ‘betaglucans…help reduce cholesterol’. In fact, the claim reported with an asterisk to a footnote, in undersized and unreadable font, where it reported that a 75g serving of pasta provided 25% of the betaglucans needed daily to achieve the beneficial effect. The health claim in question had also not (yet) been approved by EFSA. According to which 3 grams per day of beta-glucans were needed to ‘maintain’-and not also to reduce, as claimed by Riso Scotti-the ordinary blood cholesterol concentration. The claim, according to the AGCM, was also unacceptable in any case because of the small amount of beta-glucans contained in the product (0.75 g per 75 g of pasta). Penalty of 120,000 euros.

Benefit, BluPill. The Antitrust Authority has found that a dietary supplement marketed at the time as ‘Natural Viagra’ was unfair, without any proper scientific support. The claims ‘without side effects’ and ‘without contraindications’ were themselves found to be without justification. 55,000 euros the penalty.

Kilocal, Pool Pharma and Medestea Full Fast from Medestea Research & Production Spa. An unconditional weight-reducing ability was suggested, regardless of the true adjuvant role of such supplements. Absent is contextual information, particularly the recommendation not to continue supplement use for more than 3 weeks without consulting a physician. Penalty of 200 thousand euros and 100 thousand euros, respectively.

ARd Cogiton and ARd Stenovit, Bracco. Sanctioned promotional flyers for two supplements, for the prevention and treatment of brain aging and cellular neuro-degeneration-related diseases, and cardiovascular diseases. However, the scientific literature made available by the manufacturer has failed to demonstrate an etiological (cause-and-effect) link between supplement intake and the promised health benefits. The Antitrust Authority in this case also made reference to the criteria established by Legislative Decree. 169/2004. (1) Penalties of 70,000 and 80,000 euros.

2011

Misura and Galbusera, ‘cholesterol-free’ cookies. The Authority sanctioned several commercial practices in connection with the claims ‘soybean – cholesterol-free’ and ‘cholesterol-free – with ingredients containing plant sterols.’ Highlighting how the EFSA-approved claims pertain to the ability of plant sterols and phytostanols to help reduce cholesterol, without any reference to cholesterol content in foods. (2) The Antitrust Authority then noted the discrepancy between the ‘cholesterol-free’ claim and the significant fat content in the cookies, which could instead be capable of producing the opposite effect. Penalties of 290 thousand and 100 thousand euros, respectively.

Revidox, Actafarma. The health claim regarding alleged properties of resveratrol in counteracting cellular aging has never been authorized by EFSA because of the weak scientific evidence to support it. The Antitrust Authority also censured the claim of hypothetical inadequacy of the ordinary diet in providing all the nutrients, comparing the resveratrol in one tablet to that of 45 kilograms of red grapes or 45 liters of wine. Penalty of 150,000 euros.

Fishfactor, Avantgarde Spa. Such a supplement was presented as being able to ‘promote cartilage regeneration.’ However, the health claim in question has not been approved with respect to Omega 3, hyaluronic acid, or vitamin C (the three micronutrients in Fishfactor). Penalty of 150,000 euros.

2012

‘No added sugar’ jams, Hero and Zuegg. The Guarantor Authority censured the nutrition claims on the grounds that, although there were no added sugars, they appeared to be far in excess of the limits imposed by the legislature (0.5 g/100g of sugar maximum) to affix such boasts. Who suggest the appropriateness of the product with respect to categories of consumers with special problems (e.g., diabetics). The second industry had replaced sugar with grape juice (which actually contains sugar). The total sugar content was around 33-38 g/100 g in each case. Penalties imposed amounting to 100 thousand euros for the first company and 200 thousand for the second.

2013

Vivident, Happydent, Daygum and Mentos, Perfect Van Melle. The Antitrust Authority has condemned advertising campaigns suggesting a substantial-and false-equivalence between the constant use of chewing gum and proper oral hygiene. Added to this was the use of health claims that were neither truthful nor consistent with the conditions of use already validated by EFSA. ‘In this way, improper characteristics were attributed to said products that were out of keeping with their nature as foods in common use, and also induced consumers to hygienically unsound habits.’ The proceedings ended in a 180,000 euro fine, which the Lazio Regional Administrative Court recently upheld.

Uliveto and Rocchetta, ‘waters of health’? The unfair business practice was carried out by Co.ge.di International SpA in agreement with the Italian Federation of General Practitioners (FIMMG). Various health characteristics of waters have been promoted, some of which have not even been authorized by the Ministry of Health. Penalties of 100,000 euros to the operator and 30,000 euros to the FIMMG.

NatygenDna, Medestea Biotech S.p.a. Antitrust sanctioned multiple and emphatic health-related boasts (countering cellular aging and improving the cardiovascular system, immune system, skin or joint condition). Attributed, in advertisements for the dietary supplement in question–based on curcumin and resvetratol–even to its consumption for only one month. 144,000 euros the penalty imposed.

Danaos and Danacol, Danone. The Authority’s moral suasion of the French giant in 2013 was successful in getting the advertising messages changed. In the cases under consideration-a simple yogurt fortified with calcium and a fermented milk fortified with phytosterols-it was excessive to focus the communication on the occurrence of more or less severe pathologies or states of deficiency of essential elements for the body (such as in the present case the occurrence of osteopenia and/or cholesterol).

‘Fiordifrutta – no added sugars’ by Rigoni, ‘Biodelizia – no added sugars’ by Vis have been challenged, albeit questionably, because of the sugars nevertheless present in the form of fruit juices (e.g., grape juice). Realizing, the Authority, the potential to deceive sensitive consumers such as diabetics or individuals with impaired blood sugar. 40 thousand euro fine for Rigoni di Asiago S.r.l., 20 thousand euro fine for VIS S.r.l.

Giuliani’s ‘Just Sugar Free. Similar pronunciation to the previous ones, on Giuliani S.p.A.’s cookies and bakery products 90 thousand euros the penalty imposed.

‘Coca Cola – find out what you need to know’. In the investigation proceedings, the promotional campaign aimed at presenting the nutritional characteristics of the well-known beverage through a series of nutritional claims on individual ingredients was examined, which, however, were unclear and/or incomplete and therefore likely to mislead consumers. The company has modified its messages accordingly.

Red Bull. The Antitrust Authority conducted an investigation into Red Bull Italia S.r.l. to see whether the expressive methods used to promote theenergy drink–on the website and TV commercials–might be misleading about the actual characteristics of the drinks. Also considering their suitability to induce consumers, especially young people, to overconsume the drink. With special attention to the risk of incentivizing the adoption of dangerous behavior, including taking the product mixed with alcohol. The Authority accepted and made mandatory the commitments proposed by the operator, in the sense of radically changing the business strategy. In particular, the Antitrust Authority viewed favorably the elimination of any form of promotion at schools, the removal of figures of children and adolescents in commercials, and the timely limitation of advertising space purchases on channels predominantly targeting an audience of children and adolescents.

Xenalis slimming. The Authority unveiled a Chinese box system, cunningly constructed to deflect responsibility for messages disseminated by six trading companies onto a single professional located abroad. So as to hinder the consumer in identifying the actual person responsible for the sale. The investigation and inspections conducted at the two Italian practitioners also established the illegality of health claims used to promote Xenalid-branded ‘slimmers’ (such as ‘- 10 kg in ten days’ and ‘Slim without giving up’).

2014

Humana Italy. 110 thousand euros in penalties have rained down by the AGCM on advertisements for children’s vitamin and mineral supplements on Humana Italia’s website. Health claims that are untrue, as well as lacking the specific European approvals instead prescribed for any health claim related to the reduction of diseases, as well as to the development and growth of children. Other health claims, although based on Efsa-validated claims, have misrepresented their significance in communication.

Fiberpaste. The Antitrust Authority has ascertained and punished health claims related to Fiberpasta line products that were spread on the Internet and social networks. Also censuring a specific form of unlawful misleading and comparative advertising under Leg. 145/2007. The practitioner changed its conduct, bringing it in line with the provisions of the Consumer Code, soon after the initiation of the investigation proceedings.

Immun’Age, NAMED. The Authority found that Immun’Age’s overall promotional activities made extensive reference to some specific health-related features, firstly its efficacy against numerous serious diseases (Alzheimer’s, Parkinson’s disease, AIDS, cancers) or against other widely spread diseases and physiological states, such as cellular aging, flu and colds, vaccinations, and debilitating states, which have been shown to be untrue or otherwise ambiguous. The penalty imposed by the AGCM, 250,000 euros, was later annulled by the Lazio Regional Administrative Court in a ruling not without criticism.

Uliveto and Rocchetta, Co.ge.di. International. Advertising for mineral waters was deemed misleading in the emphasis of a communication that included wording such as ‘Uliveto is with A.I.G.O. gastroenterologists for digestive health,’ ‘Rocchetta is with C.L.U. urologists for urological health,’ ‘health waters. The company has made amends by removing the endorsements of the aforementioned medical associations to claims promoting the beneficial effects of the waters from the advertising texts. As well as replacing the reference to health with the more generic reference to wellness, and excluding the depiction of doctors in commercial information.

Salt reduction, generic promises. The Antitrust Authority has taken action against some industrial operators who boasted salt reduction on an effervescent digestive, a deli meat and some crackers, but did not comply with the requirements set out in Annex to the Nutrition & Health Claims Regulation. (3) The invitation to remove the profiles of unfairness was promptly accepted by the addressees, who, among other things, changed the presentation of ‘salt crackers’ by specifying the quite different concept of ‘without grains of salt on the surface’.

Dietary supplements, Perfoline. The Authority imposed onerous fines (650,000 euros) and inhibited the dissemination by Perfoline S.A.S. and Perfoline S.A. of numerous advertisements promoting supplements sold through e-commerce with the false promise of immediate, simple and lasting results in terms of weight loss. With the addition of a de-educational message that physical activity and low-calorie diets are, conversely, useless for this purpose. In view of the target audience of the messages, overweight and obese consumers, and their sensitivity as well as psychological vulnerability, the antitrust action was particularly harsh.

Asea, Gold Organ, pyramid selling schemes and deception. The AGCM found that a practice carried out by Asea Italy in the promotion and sale of the Asea drink was unfair because of the implementation of a pyramid system that involved the ‘involvement and participation of consumers in a scheme of buying and selling the product in which they were incentivized to seek out and include an increasing number of other consumers/sellers.’ The Authority also found that the health claims attributed to the Asea drink were misleading because they were not listed in Reg. EU 432/2012. The proceedings ended with the imposition of a fine of 150,000 euros. Entirely similar, also in this last respect, is the case of ganoderma lucidum-based drinks marketed by Organo Gold Europe (250,000 euro fine).

2015

The year 2015 was, for the Antitrust Authority, ‘the year of the chips’. At the center of consumer cravings, abetted by the growth of unstructured modes of dining (brunch, apericena, etc.), in and out of the home. Several deceptive practices have been challenged:

Light Chips, St. Charles. The AGCM challenged the use of the term. light – in great graphic prominence – as combined with a claim nutritional comparative (‘-30% fat’) lacking a comparator term identified in accordance with Regulation claims. (4) The communication was also misleading as a whole, both because of the use of the suggestive term ‘Sanoil’ for cooking oil and the prominently displayed boast of extra virgin olive oil, which is actually only used to the extent of 5 percent on the finished product. St. Charles has taken steps to replace the words ‘with olive oil’ with ‘with olive oil.’

‘Rustica’ Fries – Cracco’s Recipes. Images of food or food processing combined with the chips were found to be incorrect due to the lack of adequate communication. To alert the consumer, in the contiguous space and in appropriate graphic evidence, that this was not a new product but only suggestions on how to present it. Sanction of 350,000 euros.

Pata chips. The Antitrust Authority has deemed the claim ‘artisanal Pata potato chip’ coupled with the comparative nutritional claim ‘- 30 percent fat compared to traditional Pata potato French fry’ unfounded and misleading. Because the comparison was not referred, as it should have been, to the average of the best-selling products in the relevant market. As in the case of San Carlo also, Pata emphatically claimed the presence of extra virgin olive oil through use of the words ‘with Italian extra virgin olive oil’ next to images of olives and a cruet of oil. Only on the back of the package, however, was the small amount of the ingredient in question noted, compared with the larger use of sunflower oil also contained in the product (17 percent). 250,000 euro penalty.

Crik Crok, Le Contadine, ICA Foods. Also in the cases of ‘Crik Crok – 20 percent fat’ chips and ‘Le Contadine – Best for you (less than 10 percent fat)’ snack, comparative nutritional claims lacking proper terms of comparison were challenged. These claims, reiterated on the label front of the respective packages, were accompanied by reference to ‘naturally rich in antioxidants and proteins (the same ones found in vegetables) that can fight free radicals that cause cell aging.’ In the absence of any scientific basis. Further improprieties were seen in the claims ‘100 % extra virgin olive oil’, ‘Made by hand’, ‘they are good because they are homemade’. Penalty of 150,000 euros.

Amica Chips. Once again, the comparative nutritional claim ‘-20% fat’ was found to lack a suitable comparator. The boasts ‘hand-cooked’ and ‘with olive oil’ (however, present in 5% share, residual compared to other cooking oils) were also rated as incorrect. So was the depiction of foods and spices shown alongside chips, whose flavor was instead influenced only by the addition of flavorings. 300,000 euro fine.

Flavofort 1500, Merqurio Pharma. The AGCM challenged the promotion and presentation of the flavonoid-based dietary supplement ‘Flavofort1500’ due to the use of potentially misleading and untrue claims associated with alleged beneficial and therapeutic effects. The communication to physicians was also censured, where the supplement was compared with actual drugs, suggesting its impermissible, as well as unproven, curative ambition. 50,000 euros the penalty applied.

Bermé, Dolomiti Fruits. Finally, the Supervisory Authority considered the blood cholesterol-lowering effects attributed to the regular consumption of Bermè apple and bergamot juice, in labeling and advertising, including television advertising. The practitioner, noting the absence of health claims authorized under reg. EU 432/2012, took immediate corrective action. No sanctions.

2016

‘Prima donna Lidl’, ‘Carapelli Il frantoio’, ‘Pietro Coricelli Selezione’. The Antitrust Authority ascertained the unfair business practices and fined the producers of the oils marketed under the aforementioned trademarks. Noting in particular how some large operators presented as extra virgin olive oil oils whose physical, chemical and organoleptic characteristics were not consistent with the requirements of the appropriate sector regulations. Administrative fines of 550,000 euros to Lidl Italia S.r.l., 300,000 euros to Carapelli Firenze S.p.A, 100,000 euros to Pietro Coricelli S.p.A.

Moral suasion, ecommerce. The Authority, during 2016, carried out ‘extensive moral suasion against numerous professionals who operate websites on which prepackaged food products can be purchased.’ The AGCM in particular called for compliance with European rules on consumer information. (5) Where the operator has a duty to provide the consumer, before the consumer makes a purchase choice, with all the information provided as mandatory on the label. (6)

Such news, among other things, is relevant as pre-contractual information – within the meaning of Directive 2001/83/EU on consumer rights (7) – pertaining to the main characteristics of goods in distance or off-premises contracts. The Authority justified the sensitivity of its approach on the grounds that the prescriptions have only recently been implemented. (8) And furthermore, based on the ex officio surveys of websites, only partial information omissions would have emerged, which were promptly remedied at the invitation of the Authority.

Dario Dongo

Notes

1) Legislative Decree. 169/04, Implementation of Directive 2002/46/EC on Food Supplements), with regard to the relationship between professionals

2) The reg. EU 1169/11 has meanwhile permanently banned the possibility of referring in the nutrition declaration to the amount of cholesterol in the food. See paragraph ‘nutrition statement in the article)

3) v. reg. EC no. 1924/06 and subsequent amendments

4) See reg. EC 1924/06, Article 9 and Annex

5) See reg. EU 1169/2011, Article 14

6) See reg. EU 1169/2011, Articles 9 and 10. Outside of only the information that specifically pertains to the individual sales unit, such as the minimum shelf life or expiration date, and the lot code

7) Cf. d.lgs. 21/2014, implementing dir. 2001/83/EU, article 49.1.a

8) A debatable argument, given that December 13, 2014, is indeed the implementation date for most of the Food Information Regulation, but that date was scheduled three years in advance