The Scottish Government

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November 2005
ISBN 0 7559 2809 1
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CONTENTS

Covering Letter
The Consultation Process
Section 1 - THE PROPOSAL

Section 2 - CURRENT POSITION
Current requirements
Recent EC consideration of requirements
The position in other EC Member States
Voluntary provision of information on source of beef

Section 3 - WHY CHANGE?
Evidence of interest in country of origin labelling
Evidence of confusion about source of beef served
Evidence of consumers having other priorities
Assessment

Section 4 - NATURE OF THE PROPOSAL
What do we mean by beef?
How widely should food service sector be defined?
How should country of origin be expressed?
How should the information be presented to consumers?
Summary
How should the requirement be monitored and enforced?
Other foods with Scottish identity

Section 5 - CONCLUSION

Annex A - Current labelling requirements
Annex B - Regulatory Impact Assessment
Annex C - Stakeholder Group - Membership of Working Group
Annex D - Consultation List
Annex E - Respondee Information Form

Dear Sir/Madam,

Consultation paper: Country of Origin of Beef in the Food Service Sector

On behalf of the Scottish Ministers we are writing to invite comments on the enclosed consultation paper "Country of Origin of Beef in the Food Service Sector" by 28 February 2006.

This consultation paper and partial regulatory impact seeks your comments on the proposal to require the food service sector in Scotland to inform consumers in restaurants, canteens and cafés of the country or countries of origin of beef served. Information on the origin of raw beef is currently required to be provided for consumers at retail level but not within the food service sector. Some restaurants provide information on a voluntary basis. If they do not, customers have to ask if they wish to know.

The Scottish Executive has worked with a range of stake holders in identifying the issues which need to be covered in the consultation paper. Your comments on the questions contained in the paper are requested. If you wish to access this consultation online, go to http://www.scotland.gov.uk/views/views.asp. You can telephone Freephone 0800 77 1234 to find out where your nearest public internet access point is. We would be grateful if you could clearly indicate in your response which questions or part of the consultation paper you are responding to as this will aid our analysis of the responses received.

Please send your response to countryoforigin@scotland.gsi.gov.uk or Country of Origin Consultation, Mail point R259, Pentland House, 47 Robb's Loan, Edinburgh EH14 1TY. A Consultation Response Form ( copy attached) should also be completed and posted or e-mailed along with your response. If you have any queries please contact a member of the Food Marketing and Policy Team on 0131 244 6483.

Yours faithfully

Elizabeth Baird
Head of Food Marketing and Policy Branch

Consultation is an essential and important aspect of Scottish Executive working methods. Given the wide-ranging areas of work of the Scottish Executive, there are many varied types of consultation. However, in general Scottish Executive consultation exercises aim to provide opportunities for all those who wish to express their opinions on a proposed area of work to do so in ways which will inform and enhance that work.

While details of particular circumstances described in a response to a consultation exercise may usefully inform the policy process, consultation exercises cannot address individual concerns and comments, which should be directed to the relevant public body. Consultation exercises may involve seeking views in a number of different ways, such as public meetings, focus groups or questionnaire exercises.

Typically, Scottish Executive consultations involve a written paper inviting answers to specific questions or more general views about the material presented. Written papers are distributed to organisations and individuals with an interest in the area of consultation, and they are also placed on the Scottish Executive web site enabling a wider audience to access the paper and submit their responses.

Copies of all the responses received to consultation exercises (except those where the individual or organisation requested confidentiality) are placed in the Scottish Executive library at Saughton House, Edinburgh (K Spur, Saughton House, Broomhouse Drive, Edinburgh EH11 3XD, telephone 0131 244-4552).

The views and suggestions detailed in consultation responses are analysed and used as part of the decision making process. Depending on the nature of the consultation exercise the responses received may:

• indicate the need for policy development or review
• inform the development of a particular policy
• help decisions to be made between alternative policy proposals
• be used to finalise legislation before it is implemented

If you have any comments about how this consultation exercise has been conducted, please send them to:

Country of Origin Consultation
Room 259 Pentland House
47 Robb's Loan
Edinburgh EH14 1TY

1.1 This paper invites comments on a proposal by the Scottish Executive to require the food service sector in Scotland actively to inform consumers in restaurants, canteens, cafés and so on of the country or countries of origin of beef served. At present country of origin information is displayed to customers when they buy raw beef in retail outlets. No such requirement applies to the food service sector, although some premises provide this information on a voluntary basis. If they do not, customers have to ask if they wish to know.

1.2 Our purpose in proposing the change is to ensure that the consumer is informed and to avoid possible confusion. It is not our purpose to encourage or discourage the sale of beef from any particular countries or to affect the overall level of consumption of beef although the effect of informing consumers may be that their choices in future affect the pattern of demand for beef from particular sources. The proposal is not prompted by any health or food safety issues, as there are already systems in place to deal with them.

1.3 The proposal relates to beef only. Labelling requirements for beef in wholesale and retail are more detailed than for many other products. Sufficient information on the origin of beef would therefore be available to the food service sector to make implementation of the proposal feasible.

1.4 The proposal would apply to the food service sector in Scotland only. This is not a UK-wide initiative.

1.5 The consultation paper explains the current position and our reason for proposing the introduction of a requirement to indicate the country of origin of beef served in the food service sector. It poses a number of questions to seek views on whether the change would be justified and, if so, how the requirement should be designed. It would be helpful if responses set out briefly the reasons for the reply rather than giving a simple yes or no to assist us in understanding the reasons for respondents' points of view.

2.1 The paper first sets out the main points of the current position on labelling of beef and on food labelling more generally in relation to country of origin as readers may not all be familiar with these arrangements. Fuller details are contained in Annex A.

Current requirements

2.2 The EC-wide Beef Labelling Regulations established a system for the labelling of fresh, chilled and frozen beef and veal. This does not apply to processed beef (eg corned beef) and products containing beef (eg pies). The labelling information required by the Regulations must be provided by everyone in the supply chain down to retail level including abattoirs, cutting plants, wholesalers and retailers.

2.3 For beef from EC sources information will be available on country of birth, rearing and slaughtering and processing. Less detailed information may be available about beef imported from countries outside the EC. For beef imported from outside the EC, where compulsory information is not available, the beef must be labelled with 'Origin: Non- EC' and 'Slaughtered In: [Name of non- EU country]. Reference codes should be provided for where the meat is cut or repackaged after being imported. These requirements mean that the food service sector should already have information about the source of beef which it purchases. The Regulations do not, however, require the food service sector actively to inform customers of the country of origin of beef and customers will not always be aware that the information might be available on request from the establishment.

2.4 The Food Labelling Regulations require country of origin information to be provided about any food if its absence would be misleading. In other words for many products country of origin information does not have to be provided. In addition, at the discretion of Member States, exemption from some parts of the Regulations is allowable. In the UK this exemption applies under the Food Labelling Regulations to the food service sector in relation to non pre-packed food or food pre-packed on the premises.

Recent EC consideration of requirements

2.5 In 2004 the EC reviewed the operation of the Beef Labelling Regulations and considered whether to extend its terms to the food service sector. The Commission noted calls to extend origin labelling to the restaurant and institutional catering sector and the fast-food sector. The report commented that surveys of consumers in some Member States had shown that most assume that beef served in restaurants and other catering establishments is produced in their own country, while it may in fact be imported. The report further noted that national beef producers would therefore like information about the origin of the beef served to be posted in restaurants, fast-food outlets and so on.

2.6 The Commission did not favour introducing such a requirement on a Europe-wide basis. It believed that it would be difficult for operators to apply and would bring only restrictions and extra costs without any commensurate public health benefits or increase in beef consumption.

2.7 The Commission's decision not to extend the beef origin labelling rules to the food service sector does not restrict the separate scope open to Member States to adopt compulsory measures under the general food labelling provisions. To do so, the Member State must apply to the Commission for clearance.

The position in other EC member states

2.8 France has already introduced a requirement to indicate country of origin of beef in the food service sector. Ireland has sought and received initial clearance on the principle from the EC to introduce the requirement to extend origin labelling of beef to the food service sector. It is now drafting primary legislation to facilitate labelling of origin for all meats and specific secondary legislation to introduce labelling of origin for beef in the food service sector. The primary legislation will begin its passage through the Irish Parliament in the autumn. The secondary legislation will have to go back to the Commission for notification under the technical standards procedure. It is hoped in time to extend labelling of origin at least at retail level to other meats. Other EC Member States have not introduced any changes.

Voluntary provision of information on source of beef

2.9 The absence of a statutory obligation to provide country of origin information on beef is no impediment to the food service sector doing so voluntarily.

2.10 Quality Meat Scotland has established the Scotch Beef Club whose member restaurants have a policy of purchasing Scotch beef and of making this clear to customers. To be members of the Club restaurants must demonstrate a commitment to working with their supplier to identify clearly the source of their beef. This scheme applies to beef from one country of origin only but it demonstrates that it is possible to provide customers with source information.

2.11 Some other restaurants inform consumers about the origin of beef or other products where they want to draw attention to a source known for the quality of its produce.

2.12 VisitScotland is currently establishing a "Food Quality Assurance Scheme" the intention of which is to register and promote food service sector premises which offer a quality eating out experience. In addition to meeting entry level standards, establishments will be able to register particular characteristics such as using Scottish produce, being child-friendly or being vegetarian. As part of this scheme it is intended to develop standards for verifying the origin of produce in establishments registering under a proposed Scottish designation.

2.13 In outlets which do not publicise the source of beef consumers have to ask if they want to know the origin although, as mentioned earlier, they may not be aware that the information would be available.

3.1 There are two aspects to the proposal: the provision of information in its own right; and the provision of information to avoid confusion.

3.2 The first aspect is the principle that consumers should be informed about the source of the beef offered in the food service sector. This is against the background that there are strict rules about the provision of information on country of origin to those buying beef in the retail sector yet no such requirements for active provision of information in the food service sector. On the other hand there is the view that it would be odd to require the food service sector to single out beef from other foods in terms of providing country of origin information.

3.3 The second aspect is that many consumers assume that they are eating home-produced beef in the food service sector whereas much beef is imported. In an era of global trade it is questionable whether it is reasonable of consumers to assume that any particular product is home produced. The example of Aberdeen Angus beef is often quoted, as the name may suggest that Scotland is the source, whereas it refers to a breed of cattle which is raised in a number of countries and the beef imported into Scotland. Provision of information on country of origin of beef in the food service sector would remove that uncertainty.

Evidence of interest in country of origin labelling

3.4 Several studies have been carried out which gauge consumers' support for country of origin labelling. Survey results are sensitive to the framing of the questions and surveys do not always seek to quantify how much people would be willing to pay for such information. The following examples reflect one study related to eating out and one related to retail food shopping.

3.5 A survey was carried out on behalf of Quality Meat Scotland in 2005 as part of a wider market research study by NOP.¹ The research highlighted the information which must be provided on retail packs of beef and sought views on the provision of information about the origin of beef on menus in restaurants, pubs etc. Over 80% of respondents in the Scottish sample of just under 1,000 thought that it should be mandatory for restaurants, pubs, schools and hospitals to indicate the origin of beef on menus. Similar questions were asked in a UK wide study. This found a considerable but lower level of interest in the origin of beef, at around 66%, and only 45% supporting mandatory provision of information.

3.6 Food Standards Agency guidance on country of origin labelling in the context of retail trade states that it is clear that many consumers want more information on the origin of meat ingredients in meat products. ²

Evidence of confusion about source of beef served

3.7 The Report from the EC Commission mentioned in section 2 acknowledges that consumer surveys in some Member States have shown that most consumers assume that the beef they are being served in restaurants and catering establishments is produced in their own country whereas it may be imported.

3.8 The Meat and Livestock Commission ( MLC) has carried out surveys over a number of years ³. The survey carried out in 2004 indicated that 81% of consumers believe that the meat they are eating in the out-of-home market is British (a rise of 10% since 2003), whereas the supply of home-produced meat to the food service market is only around 40%. The study did not identify the position in Scotland separately although Scotland was included in the sample size.

3.9 As a result of earlier surveys of this kind, the MLC developed best practice guidelines to provide caterers with advice on how to notify consumers of their buying policy in the simplest possible terms so that they do not inadvertently mislead consumers. ⁴ The guidelines recommend that country of origin details should be provided for all dishes on the menu where the major prominent ingredient is meat based. They also advise that reference to the breed should be supported by country of origin details. The guidelines quote the example of Aberdeen Angus beef which people generally believe to be from Scotland but which can come from many other countries. The guidelines expressed the view that it was undesirable for labelling of meat origin to be a compulsory legal requirement but that it would be imposed because of mounting consumer pressure unless the industry worked together and took responsibility.

Evidence of consumers having other priorities

3.10 Responses to surveys on consumers' food purchasing priorities show that people are not consistent about the issues which they regard as most important. This may be partly due to the differing natures of surveys which prompt respondents to concentrate on different issues. The following examples reflect one study related to eating out and six related to retail food shopping.

3.11 Research carried out for VisitScotland explored how people define quality in the context of eating out. This suggested that there appeared to be three basic foundation stones that underpin a quality eating experience. These are: fresh food; friendly/professional service; and high standards of hygiene.

3.12 The Food Standards Agency Consumer Survey 2004 ⁵ looking at food safety and food standards asked respondents who refer to labels on purchased food which type of information they looked at. In the Scottish region of the Survey only 20% of respondents said that they looked at country of origin information, which was a decrease from 23% in 2003. The average for the English regions in 2004 was 23%.

3.13 The Food Advisory Committee Review of Food Labelling 2001 ⁶ stated that the Committee was aware of increasing demands (at retail level) for the place of origin of all foods to be declared on the label. However, the report stated that many proponents do not recognise the complexity of the issue, for example many foods will incorporate raw materials which have constituents from several places of origin. The Committee recommended no change to the current requirements. However, the Committee recommended that producers fully comply with the requirement to avoid misleading consumers about place of origin and recommended that they provide information voluntarily. In relation to labelling of foods sold by caterers the Committee urged the continued and extended provision of voluntary information in a catering situation in a similar way to that previously prescribed for packaged food.

3.14 IGD consumer research identified that information on origin was the 4 ^th most important item in terms of information which consumers seek when shopping. ⁷

3.15 A report by MAFF (now Defra) in 2000 sampled 1,000 people and found that the order of attributes which people look for in selection of food is: quality (76%); price (73%); health (45%); and organic or country of origin (11%). ⁸

3.16 A report "Public perceptions of food and farming in Scotland" in 2003 found that for beef sirloin steak the factors which most affected the consumer's preference for the product were: price (30%); origin (27%), production method (17%); colour (16%); and fat content (10%). ⁹

3.17 The Seafish Industry Authority carried out research on labelling of food in 1999. In response to the statement "I always look for country of origin in beef" 28% felt that this statement applied to them; 15% agreed with "I sometimes look for this"; and 44% identified themselves with the statement "I rarely/never look for this". The sample size was 1,335 people. ¹⁰

Assessment

3.18 We have considered the evidence outlined above and recognise that it is not conclusive. Different surveys seem to show a different level of interest in country of origin information. It is evident that a proportion of consumers seek country of origin information but there is limited evidence about their reasons for doing so. Potential reasons may include a wish to support the trade of a particular country or a belief that the information can be regarded as a proxy indication of quality, safety or hygiene.

3.19 The food service sector outlets which indicate the origin of beef have identified that there is a demand for this information in the market which they serve. The fact that voluntary provision of information on country of origin has not appeared to a greater extent in the food service sector, however, may suggest that there is not evidence of more wide-spread demand.

3.20 The main rationale for intervention in this context would be to correct an information failure, that is that consumers and food service outlets do not have the same information on which to base their decisions. Despite the complexities of the research evidence we consider that there is sufficient evidence of uncertainty amongst consumers about the source of beef in the food service sector and of interest in the source of beef to warrant consulting on a proposal to require indication of country of origin of beef in the food service sector. The consultation itself will help to establish the extent of consumer interest in this proposal.

Questions

Q1. Do you consider that the current requirements provide adequate information to consumers of beef in the food service sector?

Q2. Do you consider that the absence of country of origin information confuses consumers about the source of beef in the food service sector?

Q3. If you consider that the current requirements are not adequate, do you favour a voluntary or compulsory scheme to indicate country of origin of beef in the food service sector?

4.1 The proposal is that the food service sector should be required to give customers the information on country of origin of beef served. We are not seeking to impose additional information requirements on the supply of beef into the food service sector but would we looking to the food service sector to pass on the information which should be already available to them.

4.2 The Beef Labelling Regulations require certain information to be provided to the food service sector. In principle outlets should be in possession of the information which they would need to pass on to customers. In practice, we understand that the information may sometimes be held by the supplier and not passed on to the food service sector outlet. In those cases the information is available from the supplier on request, which may imply an additional administrative effort for both parties.

4.3 There are a number of questions about how one might design a requirement to inform customers of the origin of beef. We set out considerations applying to these various questions, then summarise the nature of our proposal against that background.

4.4 Even if your answers to Questions 1-3 indicate that you do not support the introduction of a requirement to provide information on country of origin of beef, please give us your views on these proposals. Doing so will not be regarded as any diminution of your opposition to the principle but will ensure that we are informed about all points of view.

What do we mean by "beef"?

4.5 The Beef Labelling Regulations require information in relation to fresh, chilled or frozen beef and veal. As mentioned above, they do not require information to be conveyed in relation to processed beef (eg corned beef) or products containing beef (eg pies, sausages and burgers). Minced beef would, however, fall within the scope of the proposal. Our proposal therefore cannot extend to beef which is supplied into the food service sector as processed beef or as products containing beef for the practical reason that the food service sector would not receive information on country of origin. Where the outlet itself makes dishes such as pies from beef supplied to it, it would have the country of origin information and should provide it to the customer.

4.6 The discussion in section 3 rests on evidence relating to beef. However, the Regulations apply also to veal. It would be consistent to treat all bovine meat in the same way. The consultation seeks views on whether the food service sector should be required to provide country of origin information about veal as well as beef. For simplicity the paper will continue to refer to beef only.

4.7 Recommendation: We propose that the requirement should apply to those products for which the food service sector would be able to receive country of origin information under the terms of the Beef Labelling Regulations. The effect would be that meals produced by them using fresh, chilled or frozen beef would be subject to the requirement, but meals using products supplied to them in processed form would not.

How widely should food service sector be defined?

4.8 There is a wide range of food service sector outlets. They include: restaurants, hotels bars and cafés; fast food outlets; private and public sector office canteens; and public sector procurement, mainly schools, hospitals and prisons. They also include less obvious outlets such as event catering, bed and breakfast establishments which provide evening meals on request and roadside snackbars. The volume and type of food service offered varies significantly. In 2002 in Scotland there were 5,538 restaurants, 4,234 bars, 2,315 hotels and motels with restaurants and 1,190 canteens and other catering facilities making a total of 13,322 food service outlets. A requirement to provide information on country of origin would affect all these outlets. In principle there is no reason to differentiate amongst these outlets but in practice there may be additional complexities in relation to, for example, event and conference catering. Those which already indicate the source of beef appear to be a tiny proportion of the total.

4.9 Food will also be served from time to time by non-commercial operations, eg village fêtes. We do not propose to include occasional events such as this. The proposal would be confined to those whose business is the sale of food.

4.10 For the sake of comparison it may be of interest to note the approaches taken in France and Ireland. Both use a broad definition of food service outlets but include the provision of food free of charge, eg free samples.

4.11 Recommendation: We consider that, if the requirement is introduced, it should apply to all food service sector outlets.

How should country of origin be expressed?

4.12 The information which is required to be provided with beef supplied to the food service sector is where the animal was born, reared and slaughtered and processed. As mentioned earlier, information on all stages will be available for EC beef but may not be available for all non EC beef. In considering the level of information which should be provided to consumers, we must bear in mind that food service outlets may receive beef originating from a number of countries.

4.13 Cutting plants are not permitted to mix batches of beef from more than one country. Moreover, the EC recently made clear that the mixing of batches of beef from more than one slaughterhouse in the same country is not permitted, although we understand that it occurs in practice in the UK. However, although food service sector outlets may receive boxes of beef, each box clearly containing beef from one country only, at any given time they may be handling beef from a number of source countries.

4.14 Recommendation

• 4.14.1 Where the beef comes from animals born, reared and slaughtered and processed in the same country, the country of origin can be stated as one country. That information should be available in the case of EC origin but may not all be available in the case of non EC origin.
• 4.14.2 Where the source is the UK, we consider it likely that consumers in Scotland would want to know whether the beef is from Scotland rather than simply stating that it is of UK origin. The Regulations require the EC Member State of birth, rearing etc to be identified and there is therefore no legal requirement to indicate the constituent parts of the UK in words on the labels on beef supplied to the food service sector. The codes used on labels, however, indicate the source and retail outlets regularly state that beef is Scotch or Scottish. We therefore invite views on whether the food service sector should be required to decode the labels to indicate whether the beef is Scotch ¹¹ or Scottish ¹² or encouraged to do so on a voluntary basis to ensure that the consumer is clear about the origin. In practice this would mean that beef categorised as UK would be UK beef other than Scotch or Scottish.
• 4.14.3 Where the beef is from animals born, reared and slaughtered in more than one country, potentially all that information could be given. However, we think it questionable whether consumers would want so much detail and suggest that a broader description such as " EC origin" might suffice.
• 4.14.4 Some outlets may specify a country of origin to suppliers - members of the Scotch Beef Club for example. Many outlets will, however, specify the cuts and the quality required and will expect the supplier to deliver the beef which meets the specification regardless of source. As a result, outlets may use beef from a range of countries and this may not be predictable. In such circumstances, we propose that they should make a statement such as "Beef supplied in this restaurant will be Scotch or Argentinean unless stated to the contrary", if they normally receive supplies from a defined number of countries, say up to three, or "We obtain our beef from a number of sources, EC and non- EC". In offering the last option we would not want outlets to use it as a convenient way of avoiding specifying origin. It should be used only where the outlet receives beef from many sources and cannot predict what will be delivered.
• 4.14.5 For the purposes of comparison we note that France and Ireland have framed their requirements in terms of providing information on country of birth, rearing and slaughtering.

How should the information be presented to consumers?

4.15 Food service sector outlets will vary in the number of beef dishes which they supply. One outlet may, for example, have more than one beef dish on its menu every day, whereas another may not offer a choice of beef dish or may not serve it every day. This proposal would require outlets to provide a general statement on the source of beef used. We would not require outlets to give separate source information about each beef dish.

An outlet would of course be free to give more detailed explanations related to individual dishes if the beef used came from different source countries and this information would be of interest to the establishment's customers. Country of origin information could be presented to the customer in a number of ways indicated below.

• 4.15.1 On menus (either in the details given on individual dishes or a general note relating to all beef dishes). For establishments which change their menus frequently and/or print inexpensively, eg a sheet of paper inside a durable folder, it would not be too onerous to print details on the menu.
• 4.15.2 Many restaurants have printed laminated menus which they intend to last for some time and cannot be sure of the source of their beef supply at the time of going to print. We suggest that it would be sufficient for them to display the information on a blackboard or poster or, if appropriate, to make a general statement on their menu about the source of beef.
• 4.15.3 Some catering may involve supplying trays to patients in hospital beds or delivering food to individual meeting rooms in an office building. Solutions in these cases may be: to indicate the source of beef on the menus, eg in hospital where the individual patient would see it; to provide a card on the trays or trolleys indicating the source of any beef used, or to fix posters in relevant places in the building stating policy.

4.16 Recommendation: We propose that the method of presenting the information should be left to the judgement of the premises, subject to the requirement that it is clearly visible to the customer.

Summary

4.17 In summary we propose that

• the requirement, if introduced, would apply to dishes made from fresh, chilled or frozen beef, but not to the use of beef supplied to the food service sector in the form of processed beef or products containing beef;
• the requirement would apply to all food service sector outlets;
• if the beef came from animals which were born, reared and slaughtered in one country, that country should be stated as the origin;
• if the label codes indicated that the beef was Scotch or Scottish this information should be given to the consumer rather than a statement that the beef was of UK origin, but we invite views on whether this should be mandatory or voluntary;
• if the beef came from animals which had moved through a number of countries or the establishment used beef from a variety of source countries, the origin would be indicated as: a list of named countries; EC; non EC; or mixed EC/non EC; as appropriate; and
• the information would be conveyed by the means preferred by the outlet (eg menu, poster or blackboard) provided that it was clearly visible to the customer.

Question

Q4. Do you agree with the proposed approach? Please explain your reasons.

Q5. Do you consider that the requirement should be applied to veal as well as to beef?

How should the requirement be monitored and enforced?

4.18 As non pre-packed food sold to the consumer in the food service sector is currently exempt from the scope of particulars of origin under the Food Labelling Regulations, any false claim made at present would be a trading standards issue. However, enforcement responsibility in relation to all other aspects of food labelling, including enforcement of the Beef Labelling Regulations in the retail sector, rests with food authorities. In practice in Scotland this function is carried out by Environmental Health Officers. It would be consistent therefore for this new requirement to form part of the responsibilities of Environmental Health Officers.

4.19 We also need to address the question of how active any monitoring and enforcement should be. Any statutory requirement is fully effective only if it is capable of being monitored and enforced.

4.20 In terms of routine monitoring of compliance, an additional check would be incorporated into the periodic food standards inspections conducted by Environmental Health Officers. This would not involve establishing any new programme of inspection visits.

4.21 Enforcement must be proportionate to the issues involved. While misrepresentation of goods is a serious matter, this is not about food safety or public health issues. We therefore propose that the responsibilities of the enforcement officers would be to investigate complaints or reasonable evidence giving rise to suspicion rather than active monitoring.

4.22 Minor breaches may often be resolved by the provision of advice to the food service outlet by the Environmental Health Officer service or Quality Meat Scotland.

4.23 For more serious matters we need to consider the nature of penalties.

• 4.23.1 One option is for penalties for failure to inform the consumer or misrepresentation of beef offered by the food service sector to be in line with those already in place for failure to comply with the Food Labelling Regulations. This constitutes an offence and the offender is liable on summary conviction to a fine not exceeding level 5 on the standard scale which currently stands at £5,000. The local authority would prepare a case and submit it to the Procurator Fiscal who would decide whether court action should be pursued. Although this approach would provide consistency with the existing provisions of the Food Labelling Regulations, we do not consider that a criminal penalty is justified in this case as the breach would be less serious than matters concerning food safety and public health.
• 4.23.2 Our preferred option would be to introduce scope for civil action. The effect of this would be to allow the local authority to impose a fine in respect of failure to comply. This would avoid the stigma of a criminal offence, but may not be a simpler procedure. There would have to be provision for the person concerned to appeal to the sheriff if he/she considered the fine unjustified. The standard period to lodge an appeal would be 21 days. If the person did not appeal but did not pay the fine either, there would have to be provision for the local authority to sue in a civil court for payment.

Question

Q6. Do you agree with the proposals for monitoring and enforcement?

Q7. Do you agree that a civil action would be appropriate?

Other foods with Scottish identity

4.24 The present proposal relates to beef only. Consumers are likely to be interested in the source of other foods. Some food service sector outlets already indicate the origin (whether by country or district) of foods when they expect the origin to matter to consumers. This may go beyond beef and include, for example, fish, other meats, dairy produce and soft fruit.

4.25 For many products country of origin information would not be as readily available as for beef. Several products, eg fish, are, however, required to be accompanied by origin information at wholesale level. That information is therefore available for retailers and the food service sector to provide to consumers at point of sale if they wish.

4.26 We mention the possible interest in other products, as we would not want to do anything in our proposal to conflict with the provision of information, on either a statutory or voluntary basis now or in the future, on other types of food.

This proposal, if introduced, would be a major change in policy away from the current exemption of the food service sector from any requirement actively to inform consumers of the source of beef - or any other product - which they serve. We are aware of evidence of interest from consumers in having such information. We are also aware that any proposal to regulate must be well founded. We are therefore very keen to receive responses to this paper and to the accompanying partial regulatory impact assessment to provide us with further information on the extent of consumer interest in the proposal and to establish whether all concerned consider that such regulation would be justified.

Current labelling requirements

Beef Labelling Regulations

1. These are contained in EC Regulation No 1760/2000 ¹³ which established a system for the identification and registration of bovine animals and for the labelling of beef and beef products. The Regulations apply to fresh, chilled and frozen beef and veal. They do not apply to processed beef (like roast beef and corned beef) and products containing beef (like pies, sausages and burgers). The labelling information required by the Beef Labelling Regulations must be provided by everyone in the supply chain down to retail level including abattoirs, cutting plants, wholesalers and retailers.

2. For beef from EC sources information will be available on country of birth, rearing and slaughtering and processing. Less detailed information may be available about beef imported from countries outside the EC. For beef imported from outside the EC, where compulsory information is not available, the beef must be labelled with 'Origin: Non- EC' and 'Slaughtered In: [Name of non- EU country]. Reference codes should be provided for where the meat is cut or repackaged after being imported. The existing labelling and traceability requirements mean that the food service sector should have information about the source of beef which it purchases. The Regulations do not, however, require the food service sector actively to inform customers of the country of origin of beef and customers will not always be aware that the information might be available on request from the establishment. ¹⁴

Food Labelling Regulations

3. The Food Labelling Regulations 1996 (No. 1499) require certain information about food products to be provided. They require country of origin information to be provided if its absence would be misleading. In other words for many products country of origin information does not have to be provided. Country of origin is not defined in the context of the Food Labelling Regulations

4. Food sold at catering establishments comes within the application of EC food labelling legislation. However, at the discretion of Member States, exemption from some parts of the legislation is allowable. In the UK this exemption applies under the Food Labelling Regulations to the food service sector in relation to non pre-packed food or food pre-packed on the premises.

Guidance Notes

5. Although country of origin is not defined in the context of the Food Labelling Regulations, Food Standards Agency guidance states that the definition in the Trade Descriptions Act 1968 provides a reasonable working guide for the purposes of the Regulations. In that Act "goods are deemed to have been manufactured or produced in the country in which they last underwent a treatment or process resulting in a substantial change". The guidance comments that, while it would ultimately be for a court to decide on the meaning of the term "substantial", the transformation of pork into bacon, ham or pies might be regarded as substantial change, but this is less likely to be the case with the simple slicing, cutting and/or packing of meat.

6. The guidance states that in catering establishments care should be taken to ensure that the wording of any origin information which they wish to give on menus etc is clear and unambiguous.

Partial Regulatory Impact Assessment 2005/06

1. Title of proposal
2. Country of origin of beef in the food service sector.
3. Purpose and intended effect

• Objective

2.1 The objective is to provide consumers in Scotland with information on the country of origin of beef served to them in the food service sector. The food service sector is made up of hotels, restaurants, bars, canteens and other catering facilities.

2.2 Implementation of the proposal by the food service sector would immediately achieve its aim of provision of information.

2.3 Before that stage we require to: consult on the proposal; prepare legislation reflecting the decisions taken on the approach following the consultation; submit an application to the EC for clearance of our proposal; and, subject to EC clearance, introduce the regulation into the Scottish Parliament.

• Background

2.4 At present country of origin labelling of beef is mandatory up to the point of supply to the food service sector but not at the next stage when it is provided to the customers.

2.5 Some consumer surveys indicate a high level of interest in the source of beef served in the food service sector and a desire for compulsory provision of information on country of origin. The proposal is thus partly based on the principle that it is right for consumers to be given information to enable them to make choices. The proposal is also based partly on evidence that many consumers assume that they are eating home-produced beef in the food service sector whereas much beef is imported and that compulsory indication of origin would avoid this confusion. Other surveys suggest that knowledge of country of origin is not a high priority for consumers. The purpose of this consultation is to establish whether consultees consider that there is a case for change.

2.6 A requirement to indicate country of origin of beef in the food service sector would create consistency in the sense that such information is available to consumers in the retail trade. On the other hand it would create inconsistency by setting beef apart from other products supplied in the food service sector.

2.7 In 2002 in Scotland there were 5,538 restaurants, 4,234 bars, 2,315 hotels and motels with restaurants and 1,190 canteens and other catering facilities making a total of 13,322 food service outlets. A requirement to indicate country of origin would affect all these outlets. A minority already indicates the source of its beef but this is a tiny proportion of the total.

2.8 The European Community chose not to extend its beef labelling regulations to the food service sector. The UK's Food Labelling Regulations, based on EC requirements, similarly exempt the food service sector. The EC has, however, left it open to Member States to decide whether to introduce additional requirements, subject to clearance with the EC.

• Rationale for government intervention

2.9 The main rationale for intervention in this context would be to correct an information failure, that is that consumers and food service outlets do not have the same information on which to base their decisions. If the proposed requirement were not introduced, consumers in the food service sector would be less actively informed than if we introduce the change. As at present the consumer would have to ask for country of origin information if he or she wished to know, except in the minority of outlets where information is already provided on a voluntary basis.

3. Consultation

• Within government

3.1 Internal consultation has taken place within the Scottish Executive and with the Food Standards Agency Scotland.

3.2 The administrations of England, Wales and Northern Ireland have been informed of this proposal but have not been formally consulted as it would apply only in Scotland.

• Public consultation

3.3 A working group of stakeholders has assisted the Executive in identifying the issues which need to be aired in the consultation paper and regulatory impact assessment. These documents now form the basis of public consultation to which interested parties, including the members of the working group, are invited to respond.

Options

4.1 Option 1 - No change. Continue with the present system which does not require the food service sector actively to inform customers of the country of origin of beef, but leaves it to voluntary action where an outlet considers that there is sufficient customer demand for that information. Alternatively consumers have to ask if they wish to know. The risk of continuing with this situation is that information on country of origin of beef continues not to be readily available to consumers in the majority of food service sector outlets. This is not a risk of any significance. As stated, customers can ask if they wish the information.

4.2 Option 2 - Introduce a scheme to require the food service sector to provide country of origin information about beef to customers. This would be implemented by food service sector outlets displaying information to customers on the source of beef provided by them. This might be one country or a number of countries. If the outlet routinely used beef from a wide, and possibly unpredictable, variety of sources, the information might be in general terms such as " EC countries". The information might be displayed on the menu, on a poster or on a blackboard. As the consultation paper explains, our proposal limits the level of prescriptiveness about the amount of detail and the format in which it would be provided as we do not consider that more elaborate arrangements would add value for the consumer.

4.3 The purpose of the proposal is to ensure the provision of information to consumers. It is not our purpose to encourage or discourage the sale of beef from any particular countries or to affect the overall level of consumption of beef. A risk of implementing option 2 is that the effect of informing consumers may be that their choices in future affect the pattern of demand for beef from particular sources which would have an impact on producers, processors and suppliers. This effect would be governed by consumer choice which could occur irrespective of any change of policy.

5. Costs and benefits

• Sectors and groups affected

5.1 Consumers considering choosing beef in the food service sector would be affected. The proposal would not affect consumers who did not wish to eat beef.

5.2 The food service sector would be affected by the requirement to change practices. As explained below, the costs could disproportionately affect smaller businesses, but our aim is to minimise the costs.

5.3 Producers, processors and suppliers should not be directly affected by the proposal. This proposal does not set out to influence demand for any particular kind of beef or to influence whether consumers choose beef or other foodstuffs. They could be affected if greater awareness of country of origin of beef indirectly led to a shift in demand between products or between suppliers.

• Benefits

5.4 As Option 1 is "no change", which by definition does not incur additional costs and benefits, it is not mentioned in this section. All comments below relate to option 2. These set out the nature of the costs, which we aim to keep to a minimum, and we would like respondents to comment on the possible quantification of these costs.

• Consumers

5.5 Consumers will benefit as a result of being actively informed about the source of beef in the food service sector. This overcomes the problem of information failure, ie. that the consumer does not know where the beef originated from but the food service outlet does. By allowing both parties to have the same information consumers can make informed choices.

• Food service sector

5.6 No change in economic benefit. We do not see this proposal as having any impact on the overall level of consumer demand for the food service sector. The provision of information on the source of beef is unlikely to influence the frequency with which people choose to eat out of the home.

5.7 The proposal might indirectly have some effect on the type of foods which consumers choose. This could conceivably have a benefit if consumers chose more profitable items, but any estimates of possible shift in pattern would be highly speculative and therefore not meaningful.

• Producers, processors, suppliers

5.8 The proposal should not have any direct benefit for producers, processors and suppliers as it concerns the supply of information and not the supply of products.

5.9 If the provision of information led indirectly to a shift in consumer behaviour which resulted in a demand for beef from different sources or for other products as an alternative to beef, there would be a benefit for the producers and suppliers of these products. It is unlikely that there would be a significant shift in purchasing patterns as evidence suggests that price or a perception of value for money is the main factor determining behaviour. We do not make any estimates of possible shift in pattern as these would be highly speculative and therefore not meaningful.

5.10 If there were a shift towards beef produced in Scotland, the benefit would fall to Scottish producers, processors and suppliers on the assumption that they would increase output rather than displace output from the retail trade into food service. If there were a shift towards beef from other countries producers in those countries would benefit. If there were a shift towards alternative products, it is unclear which producers and suppliers might benefit or whether the benefit would accrue to Scottish or external businesses.

• Costs
• Consumers

5.11 There would be no cost to the consumer except in so far as any costs of publicising the country of origin of beef were passed on to the customer (see below).

• Food service sector

5.12 Publicising the country of origin of beef would incur a cost. However, as the consultation paper makes clear, we propose a pragmatic approach such as a simple notice or blackboard, the cost of which should be minimal compared with other running costs of a business. The cost passed on to the customer should therefore be negligible.

5.13 As the aim is to minimise the cost of displaying country of origin information, we do not expect any such requirement to create an incentive to the food service sector to stop supplying beef in favour of products the origin of which did not require to be disclosed.

5.14 Current legislation requires country of origin information to be supplied to the food service sector. We understand that in practice in some cases information is held by the supplier at present and not routinely delivered to the food service outlet. The information could, however, be obtained on request. In those cases, the proposed requirement would introduce an administrative cost to the supplier and food service outlet. As the practice would be in line with existing requirements, we do not regard this as an additional cost due to this proposal.

• Producers, processors, suppliers

5.15 The proposal does not require any change in labelling by producers, processors and suppliers and therefore does not incur any direct costs except possibly as described in paragraph 5.14 above.

5.16 In principle an indirect cost could be loss of trade to some businesses if there were any shift in demand for products. As stated above, any estimates would be speculative.

• Local authorities

5.17 Costs of monitoring and enforcing would fall to local authorities through the Environmental Health Officer service and thus to the taxpayer. As described in the enforcement section below these costs are expected to be small.

6. Small/Micro Firms Impact Test

6.1 While the proposal does not seek to distinguish between size of businesses, the costs of compliance, ie displaying information, would be higher pro rata in small and micro businesses compared with the value of beef sold. As indicated above, the intention is to minimise the cost of displaying information so that it should not be burdensome even for very small businesses.

6.2 Small and micro businesses are invited to respond to this consultation raising any issues of particular concern to them.

7. "Test Run" of business forms

7.1 No new forms are required.

8. Competition assessment

8.1 We considered the effect of the proposal on the market against the following 9 questions which form the competition filter test. A "yes" answer would indicate a possible competition concern.

8.2 As the regulation would apply equally across the food service sector, competition between outlets should not be adversely affected, subject to assumptions stated in section 6 above being correct.

8.3 Food service sector companies operating in Scotland would be affected whereas those operating only in other parts of the UK would not. However, we aim to keep the costs to a minimum so that this effect should be negligible.

8.4 As food service sector outlets compete with others in their locality and do not compete with those in other countries, the fact that this proposal applies to Scotland only would not have an impact on competition between countries.

9. Enforcement, sanctions and monitoring

• Enforcement

9.1 Local authorities are responsible at present for enforcement of statutory food labelling requirements. This is carried out by the Environmental Health Officer ( EHO) service.

9.2 EHOs already carry out periodic food standards inspections of the food service sector. Such inspections would additionally check that the country of origin of beef was displayed satisfactorily. This would be a small addition to the inspection with negligible cost.

9.3 In the event of any complaint or suspicion the EHO service would investigate. This would be a cost to LAs, but on the assumption that food service sector outlets displayed correct information, there should be little cause for complaint and therefore few investigations.

• Sanctions

9.4 If there were any cause for concern, a judgement would be made about appropriate action. In general advice from the EHO or from Quality Meat Scotland should assist the outlet to comply.

9.5 Only in more serious cases would formal action be necessary. Non-compliance with current statutory food labelling requirements constitutes an offence. It is liable on summary conviction to a fine not exceeding level 5 on the standard scale. The consultation suggests that this type of offence and penalty would not be appropriate. The paper invites views on a proposal that the less serious nature of any breach of this proposed requirement might be better suited to civil action. The local authority would bear the cost of action. In some cases this may lead to court action because of an appeal against or non-payment of a fine. As we intend the proposed requirement to be easy to comply with, we would expect any formal action for non-compliance to be infrequent.

• Monitoring

9.6 As stated above, the aim is provision of information. Feedback from local authorities would indicate if there were any significant failure to comply.

COUNTRY OF ORIGIN STAKEHOLDER GROUP MEMBERSHIP

Consultation List