Jun 9, 2021

Legislation Would Impose a Burdensome, Duplicative New Food Labeling Scheme on Food Retailers 

 

ARLINGTON, VA—The U.S. Senate’s passage of S.1260, the U.S. Innovation and Competition Act, includes language from the Country-of-Origin Labeling (COOL) Online Act that would create duplicative and burdensome requirements for online sales administered and enforced by the U.S. Federal Trade Commission. FMI is strongly opposed to the creation of these new requirements, as they would conflict with the United States Department of Agriculture’s (USDA) existing COOL program and be unworkable for agricultural producers, food manufacturers, and grocery retailers.  

As written, the legislation would require retailers to include country of origin information in product descriptions on their websites, reflecting the origin of the exact product the customer will receive. Changing the requirements to require country-of-origin information of the exact product to be delivered to the consumer in advance of delivery may seem minor, but it creates significant and costly new technology challenges, in addition to conflicting with current requirements identifying the country of origin on the package that have been in place under USDA’s authority for more than a decade.  

FMI Vice President, Tax, Trade, Sustainability & Policy Development Andy Harig states, “Now is not the time to place additional, duplicative burdens on essential industries like food retailers with no additional benefit to customers. Online purchasing by customers has increased exponentially due to the COVID pandemic and retailers have expanded their online product offerings at significant costs to meet consumer needs.” 

The new FTC requirements, if implemented, would leave retailers with few options: making costly investments in real-time inventory tracking of every covered product in stores and online, in addition to the information on the package or product, reducing product offerings online to prevent fines and penalties under the new COOL requirements, or potentially canceling portions of customer orders if those goods cannot be sourced at the store-level with the country of origin that was advertised online.  None of these options add value for U.S. consumers or the food supply chain. The existing USDA COOL program works – it provides consumers with country-of-origin information in an efficient and cost-effective way that also has a high compliance rate from food retailers.  FMI will advocate to prevent duplication and preserve the existing USDA COOL program as this legislation moves to the U.S. House of Representatives.”