Summary

The American Health Care Act (AHCA), released by House Republicans late on March 6, 2017, would repeal and replace certain portions of the Affordable Care Act (ACA). The legislation does not address section 4205 of the ACA, from which the U.S. Food and Drug Administration’s (FDA or the Agency) Menu Labeling Rule emanates. This means that covered establishments should expect FDA to move forward with enforcement of the Rule starting on May 5, 2017.

We discussed in a previous alert the impact (if any) an effort to repeal and replace the ACA would have on FDA’s final rule, “Food Labeling; Nutrition Labeling of Standard Menu Items in Restaurants and Similar Retail Food Establishments” (Menu Labeling Rule or the Rule). The Rule, which emanates from section 4205 of the ACA, requires restaurants and “similar retail food establishments” (such as convenience stores, grocery stores, concession stands, and food takeout or delivery establishments) that are part of a chain of 20 or more locations and that sell substantially the same menu items (covered establishments) to, among other things, post the following on menus and menu boards:

• calorie information;
• a succinct statement on suggested daily caloric intake; and
• a statement that written nutrition information is available upon request (and provide such information, upon request).

The Republican-controlled Congress intends to move the AHCA forward through budget reconciliation to avoid the need to have 60 votes in the Senate for passage. The legislation does not address section 4205 of the ACA, “Nutrition labeling of standard menu items at chain restaurants.” Section 4205 of the ACA is not related to taxes or revenue, so it cannot be repealed through budget reconciliation. This means that covered establishments should expect FDA to move forward with enforcement starting on May 5, 2017. As we discussed in the above-referenced alert, the National Restaurant Association (NRA) supports FDA’s Rule so its members can avoid having to comply with a patchwork of state and local menu labeling requirements. Perhaps NRA’s support will be enough to spare the Rule from the ACA chopping block.
 
What remains unclear is what effect, if any, President Trump’s “one in, two out” executive order on federal regulations will have on the Agency’s Menu Labeling Rule. Under the policy, whenever an executive department or agency proposes a new regulation, it must identify at least two existing regulations to be repealed. The policy does not specify whether an agency proposing a new regulation has to identify two of its own rules to repeal or whether it could target another agency’s rules. We are continuing to monitor developments in this area and will issue further updates, as warranted.