Compliance: Updated nutrition labeling requirements

On May 27, 2016, FDA published final rules that updated the Nutrition Facts label for packaged foods. Originally, the final rules established compliance dates of July 26, 2018 for manufacturers with $10 million or more in annual sales (“large manufacturers”) and July 26, 2019 for manufacturers with less than $10 million in annual food sales (“small manufacturers”). These compliance dates were amended by FDA to Jan. 1, 2020 for large manufacturers and Jan. 1, 2021 for small manufacturers. Although the compliance dates were previously extended by two years, FDA announced it did not intend to take enforcement actions related to the new nutrition labeling requirements for the first six months following the Jan. 1, 2020 compliance date for large manufacturers.

It has been several years since FDA published its final rules for Nutrition Facts labeling. While many companies have chosen to implement the “new” labels well in advance of the 2020 compliance date, the vast majority of food, beverage and dietary supplement labels continue to bear the “old” Nutrition Facts panel. While FDA has stated its intention to utilize enforcement discretion for the first six months following the 2020 compliance date, no such announcement has been made in regard to the Jan. 1, 2021 compliance date for small manufacturers. Although 2021 seems like plenty of time to implement the new labels, numerous factors should be considered at the beginning of 2020 to prepare for compliance in 2021.

Label stock

Most companies keep an inventory of printed labels ready to meet their manufacturing needs. The number of labels kept on hand will vary depending on a variety of factors, including the popularity of a particular SKU, the time it takes to manufacture a certain product, and the time it takes the label printer to deliver the completed labels. Additionally, like most materials, a larger “discount” is traditionally offered by label printers when a company orders a higher number of labels in one purchase order. As a result, there is a high probability that at any given time a company has enough labels in stock to last from several months to a year (or more). Multiply that number by various SKU sizes and flavors, and companies may be sitting on a ton of labels that will be deemed noncompliant on Jan. 1, 2021. The clock is ticking.

To avoid disposing of these labels and throwing away money, companies should focus on developing a sound plan to phase out “old” labels while introducing the new compliant labels in time for the 2021 compliance date. One strategy is to begin updating the labels of the products for which a company currently has the least amount of label stock. Rather than purchasing more “old” labels, it can plan to update those SKUs first while the labels are utilized and the stock decreased.

Art creation and regulatory review

Companies must take into consideration the time it will take for its “old” labels to be reviewed and brought into compliance with the new labeling regulations. If a company uses a law firm to review its labels (it should), it must factor in the time it will take the law firm to review the labels and provide feedback. Undoubtedly back-and-forth comments and edits will take place between the law firm and the graphic designer creating the label art. Remember, most graphic designers are not regulatory experts and the labeling regulations are highly technical.

Cost will also be a factor. If a brand has numerous products, sizes and flavors, it may not want to pay for all of these reviews and designs at one time. Starting this process early will allow the company to slowly implement new labels and pay the associated costs over the course of 2020. The time needed to review and edit an entire catalog of product labels will vary depending on the company, but starting early will ensure a smooth transition rather than rushing at the end of the year and paying a large fee at one time.

Nutrient declaration

While this article does not discuss all of the changes to the new Nutrition Facts labeling, several are worth mentioning for the purposes of planning. The “old” Nutrition Facts regulations required the percent daily value of four vitamins/minerals (vitamin A, vitamin C, calcium and iron) be listed for foods. The new Nutrition Facts regulations removes vitamin A and vitamin C from the required listing and replaces them with vitamin D and potassium. Furthermore, in addition to listing the percent daily value of these four vitamins/minerals, companies must also list the amount of the vitamins/minerals declared. Vitamin D, which used to be listed in international units (IU) when declared in foods and dietary supplements, must now be listed in micrograms, with IU being permitted as a voluntary declaration in parenthesis after micrograms. Another major change that all companies must take into consideration is the listing of Added Sugars underneath Total Sugars. While Total Sugars does not have a recommended daily value (“RDI”) under FDA regulations, Added Sugars has an RDI of 50 g. Working with one’s manufacturer to determine the correct amounts of these nutrients is essential when updating labels for FDA compliance and to avoid class-action lawsuits.

Preparing for consumer questions

One of the main objectives of the new labeling regulations is to make it easier for consumers to make better informed food choices. However, with change comes consumer questions. Some consumers may already be familiar with the new labeling format and question why a company’s products have an “old” label. Other consumers may wonder why the label they have been used to seeing on products has suddenly changed. Training one’s customer service department on how to handle questions related to the new labeling format will help consumers adjust to the new look of the company’s packaging and help facilitate consumer trust and transparency.

The beginning of the year is an exciting time for companies in the natural products industry. Planning new product launches, developing sales strategies and maintaining brand image is always at the forefront in the new year. However, with the compliance date for the new labeling regulations looming, companies should focus on developing a sound strategy to update labels, mitigate expenses and inform consumers.

Jonathan "Jay" Manfre, Esq., is a graduate of New York Law School and the chief legal officer of Redcon1, a rapidly growing U.S. sports nutrition company based in Boca Raton, Florida.