Austria: Bulgarian Courts And The Deepest Recesses Of Marketing

Some local interpretations of the concepts of clean labelling and claims related to children's development and health

This article aims to examine the arguments of the Bulgarian courts pronounced in the judgments of two court instances on a single administrative court case. The arguments demonstrate the perception of the Bulgarian courts on some central topics of food law, such as labelling and presentation of food, clean labelling and claims related to children's development and health.

According to the first instance court decision, on 23 January 2017 the Commission on Protection of Consumers (CPC) carried out a check in a supermarket and found that a food product "Frankfurters for children" was offered for sale. The product was packed in a polyethylene pack with the manufacturer's label containing inter alia the following information: "Frankfurters for children (drawing of a boy or a girl holding a hot-dog); no soya, gluten, and monosodium glutamate; Boiled-smoked frankfurters for children, with pork protein."

The producer (the responsible food business operator) was required to provide the CPC with a reasoned opinion on the existence of a specific advantage which could justify that the frankfurters are marketed as such intended for children.

The CPC has requested, and the Bulgarian Food Safety Agency has provided, an opinion saying that it is clear from the documentation provided by the producer that the frankfurters do not comply with the recommended nutritional standards for children (specified in a local secondary legislation act). Their ingredients and production technology do not give them special characteristics that could define their special purpose – food for children over three years of age. According to the Bulgarian Food Safety Agency, the frankfurters are in fact a food product common for the Bulgarian market and usually consumed by all consumers, including children.

In addition, the CPC was provided with an opinion from the National Centre for Public Health and Analysis signed by Prof. Duleva (MD and Head of the Food and Nutrition Department) stating that:

  1. the labelling, advertising and presentation of products referred to as "for children" is not based on established claims related to children's development and health; 
  2. there are no statutory requirements in the European and national legislation on food "for children (over three years of age)";

therefore, it cannot be determined whether the frankfurters in question have a specific advantage over other products on the market based on which they can be considered fit for consumption by children.

In its opinion on the same matter, the Chief State Health Inspector has stated that under current European and national legislation, only (i) foods that meet the requirements of the applicable legislation on food for infants and young children or (ii) foods with claims related to children's development and health validated under Regulation (EC) No 1924/20061 can be classified as "food for children".

Based on the provided findings and opinions, the CPC has established that the producer of the frankfurters uses unfair commercial practices and provides misleading information on the specific advantages and characteristics of its product by offering it for sale as intended for children. These actions were classified as a violation of Art. 68e of the Bulgarian Consumer Protection Act (CPA)2. According to the CPC, in the case at hand, the overall presentation of the product misleads or is likely to mislead the average consumer and is likely to lead to a commercial decision that the average consumer would not have taken were it not for the unfair commercial practice. Therefore, the CPC has prohibited the manufacturer from presenting the product as intended for children.

The manufacturer has challenged the CPC's order in court. According to the decision of the first instance court "the requirement of good faith in the provision of information on the properties and characteristics of the product is violated", because the "overall performance of the product misleads that [the product] has an advantage over other products of the same type". The producer claims it is specifically manufactured for children's consumption although "its production does not distinguish [the product] from the other products [on the market] and [it] does not reveal special characteristics".

The first instance decision of the Administrative Court Sofia-City (Second Division, 27th chamber) was confirmed by the Supreme Administrative Court (SAC) earlier this year (Decision No. 26, dated 8 January 2019 in Case 12030/2017 – the final decision taken in a panel of three judges).

According to the SAC, the information on the label will give the average consumer the impression that the product was "specifically designed for children". Furthermore, the SAC accepts that the label "frankfurter for children" explicitly indicated that the product is suitable for children. Considering these inscriptions, in combination with the graphic images of a child, the average consumer, according to the final court instance, "has the impression that the product has specific advantages over those of the same kind as far as it is more wholesome or less harmful".

With respect to the "clean labelling" wording on the packaging of the product ["no soya, gluten, and monosodium glutamate"], the SAC accepts that:

  1. the manufacturer has unreasonably assumed that the product can be described as intended for children because soya, gluten and monosodium glutamate were excluded from its composition; 
  2. art. 7, par. 1 of the Food Information Regulation3 must apply (letter "c") – the information shall not be misleading, claiming that food has particular characteristics (by emphasising the absence of certain ingredients and/or nutrients) when in fact most similar foods possess the same characteristics.

The cited case law and the interpretation of the current legislation are new to Bulgaria. It could be considered the logical conclusion of the longstanding public controversy concerning the composition of products identified as such "for children". In this context, we could make some conclusions or forecasts about the direction of the forthcoming development of food law in Bulgaria:

  1. The designation of a foodstuff as "for children" will probably be considered justified if the manufacturer can prove that the relevant product has some advantage (in terms of the ingredients used and/or the production methods) compared to other similar products. Considering the two cited court decisions, our expectation is that the term "advantage" should be understood in the context of healthy diet/eating; 
  2. If the manufacturer fails to prove that a product has an advantage over similar products on the market, the product's designation as "for children" or labelling with text/graphics that could classify the product as "for children", although it does not differ in its composition and production methods from other products on the market not classified as "for children", would be considered an unfair commercial practice against consumers.

This understanding of the CPC coincides with the most recent practice of the Commission for Protection of Competition, which has imposed several sanctions for unauthorised "comparative advertising" even in the absence of direct comparison with a competitor. According to the Commission for Protection of Competition, it is sufficient the overall advertising context to make an indirect comparison with a competitor (for example, the use of the comparative form "best" was accepted as a comparison to all other competitors; the slogan "change the supermarket", without a reference to particular supermarket was accepted as a direct invitation to the consumers to "not use a particular supermarket").

  1. Points 1 and 2 will most probably not apply to products which (i) are in compliance with the legislation on foods for infants and young children (aged between one and three years), and/or (ii) are labelled with duly validated claims related to children's development and health according to the requirements of Regulation 1924/2006; 
  2. Unjustified use of "clean labelling" could be easily classified as a violation of art. 7, par. 1 of the Food Information Regulation and as unfair commercial practice, which may also trigger an investigation by the Bulgarian Commission on Protection of Competition.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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