On July 29, 2016, U.S. President Barack Obama signed into law the first U.S. federal law requiring food manufacturers and distributors to label products that contain genetically modified organisms (“GMO”).[1] The law requires the U.S. Department of Agriculture (“USDA” or the “Agency”) to establish and administer a national standard for GMO labeling in two years and generally preempts state GMO disclosure laws, including the law that took effect in Vermont on July 1. Food companies should review the new law carefully to determine how it may affect its food product labeling.
National Mandatory Bioengineered Food Disclosure Standard
Under the new law, the USDA has two years to establish a “national mandatory bioengineered food disclosure standard” for “any bioengineered food and any food that may be bioengineered.”[2] The standard is to apply to “food” as defined in the Federal Food, Drug, and Cosmetic Act (“FDCA”)[3] and specifically to three subsets of “foods”: (1) foods subject to FDCA labeling requirements; (2) foods subject to the labeling requirements under the Federal Meat Inspection Act, the Poultry Products Inspection Act, or the Egg Products Inspection Act where the most predominant ingredient would independently be subject to the FDCA labeling requirements; and (3) foods subject to the labeling requirements under the Federal Meat Inspection Act, the Poultry Products Inspection Act, or the Egg Products Inspection Act where the most predominant ingredient is broth, stock, water, or a similar solution and the second-most predominant ingredient would independently be subject to FDCA labeling requirements.[4] Interestingly, the new law does not specifically exclude dietary supplements. Given that dietary supplements are considered to be foods under the FDCA, they appear to be currently subject to the new law as well.
A bioengineered food is one that contains genetic material that has been modified through in vitro recombinant DNA techniques and for which the modification could not otherwise be obtained through conventional breeding or found in nature.[5] Congress has given the USDA the responsibility of setting the threshold amount of bioengineered substance that must be present for a food to qualify as bioengineered.[6]
Manufacturers of bioengineered foods will have at least three options for disclosing genetic modifications on its food labels: (1) text statement, (2) representative symbol, and (3) electronic or digital link, such as a Quick Response (QR) Code.[7] Small food manufacturers also may use a phone number, with a statement indicating that the phone number provides access to additional information, or a website to provide genetic modification information.[8] Very small food manufacturers, as to be defined by the USDA, are not subject to the disclosure requirement.[9]
Knowingly failing to make the required disclosure is a prohibited act that may result in USDA enforcement action, except that the USDA has no authority to recall a food solely because it fails to bear the bioengineered foods disclosure.[10] Manufacturers subject to this new law will also be subject to certain recordkeeping requirements as will be promulgated by the USDA.[11] Such records may be examined by the USDA, after which the Agency must make public a summary of any examination or audit.[12]
Conclusion
The passage of the federal law avoids a state-by-state patchwork of GMO labeling requirements, which will help mitigate confusion and cost for consumers, farmers, and food companies. However, the federal law also raises potential regulatory quandaries for food manufacturers. As explained above, the law authorizes the USDA alone to establish and implement the national standard for bioengineered food labeling, even though the standard would apply to certain foods that would otherwise be under the U.S. Food and Drug Administration’s (“FDA”) regulatory jurisdiction. In its comments to the proposed bill, FDA expressed concern that the USDA’s future regulations implementing the mandatory standard could conflict with FDA’s labeling requirements. For example, FDA highlighted that manufacturers may not be able to fit both FDA’s required statements and the USDA’s required information on small package labels. Likewise, FDA indicated that allowing genetic modification information to be presented in an electronically accessible form and not on the package label is “in tension” with FDA’s laws that require disclosures on food labels. FDA also commented on the “narrow scope” of “bioengineering,” in that it seems to be limited to foods that “contain” genetic material and thereby could be interpreted as excluding foods from genetically engineered sources, such as soy. It will be interesting to see if and how the USDA addresses these issues in its regulations.
Companies that have already complied with the Vermont GMO law will need to reevaluate their product labels and labeling in light of the new federal law. For example, companies should carefully review Vermont’s definition for “genetic engineering” against the federal law’s definition for “bioengineering” to determine whether different subsets of their products will be required to bear the labeling disclosure. Likewise, companies that may not have been previously subject to the Vermont disclosure requirement may be subject to the federal law disclosure requirement. Such companies may include dietary supplement manufacturers. The federal law also lends some additional flexibility to food manufacturers by allowing representative symbols or QR codes to be used instead of Vermont’s required text disclosure statements. Industry should be aware that the new law also requires the USDA to conduct a study in the next year to identify potential technological challenges with consumer ability to access electronic or digital disclosures. Depending on the study’s conclusions, the USDA may provide additional and comparable options for the bioengineering disclosure that are more easily accessed by consumers.
The exact timeframe for required compliance is unclear. Although Congress has mandated a two-year timeframe for the USDA to establish the disclosure standard, it is uncertain whether this two-year timeframe is realistic given the ongoing debate surrounding GMO labeling. Furthermore, once the USDA has promulgated its regulations, it will provide an implementation date. Small food manufacturers will be provided a later implementation date that is not earlier than one year after the implementation date for larger manufacturers. We will continue to monitor the USDA’s progress in developing the standard and would be pleased to assist with evaluating compliance with the laws in this evolving space and advocating on behalf of companies as regulations are developed and proposed.
Notes:
[1] S. 764, 114th Cong. (2016) (amendment to Agricultural Marketing Act of 1946, 7 U.S.C. §§ 1621 et seq. (“AMA”)). We cite to specific portions of the new law throughout this Alert according to the section number designated in the enacted law.
[3] Id. at 291(2). The FDCA broadly defines “food” as “(1) articles used for food or drink for man or other animals, (2) chewing gum, and (3) articles used for components of any such article.” FDCA 201(f).
[5] Id. at 291(1). The law excludes foods derived from animals to be considered “bioengineered foods” solely because the animal consumed feed produced from, containing, or consisting of a bioengineered substance. Id. at 293(b)(2)(A).
[7] Id. at 293(b)(2)(D). USDA is required to provide “alternative reasonable disclosure options for food contained in small or very small packages.” Id. at 293(b)(2)(E).
[10] Id. at 293(g)(1), (4). The new statute does not specifically address the types of penalties or actions that may be imposed or taken by the USDA. Companies may be subject to enforcement actions under the authority of the USDA’s Agricultural Marketing Service.
