BILL ANALYSIS ---------------------------------------------------------- |Hearing Date:April 12, 2004 |Bill No:SB | | |1580 | ---------------------------------------------------------- SENATE COMMITTEE ON BUSINESS AND PROFESSIONS Senator Liz Figueroa, Chair Bill No: SB 1580Author: Bowen As Amended: April 12, 2004 Fiscal: Yes SUBJECT: Food product advertising: trans fatty acids. SUMMARY: Requires manufacturers to accompany claims of "low saturated fat" or "reduced saturated fat" with the phrase "Contains Trans Fat" if the product contains trans fat. Existing law: 1)Regulates false and misleading advertising generally, and subjects violators to both civil and criminal penalties. 2)Establishes the Sherman Food, Drug, and Cosmetic Law which governs packaging, labeling, advertising, manufacture and sale of foods and drugs, and is administered by the State Department of Health Services. 3)Specifies that any food is misbranded if its labeling is false or misleading in any particular. Existing federal law, the Federal Food, Drug, Cosmetic Act and the Nutrition Labeling and Education Act of 1990: 1)Requires the Federal Drug Administration (FDA) to regulate nutritional labeling information and provides, among other things, that certain nutrients and food components be included in nutrition labeling. 2)Sets nutrient content claims for fat and fatty acids and specifies that a claim about the level of fat and fatty acids in a food may only be used in accordance with the SB 1580 Page 2 definition of that term. Specifically, prescribes conditions under which the terms "low saturated fat" and "reduced saturated fat" can be used. 3)Requires food manufacturers to list trans fat on the Nutrition Facts panel immediately under saturated fat on the nutrition label by January 1, 2006. 4)Provides for national uniform nutrition labeling by providing for the preemption of certain types of state and local labeling requirements that are not identical to applicable federal requirements, including food standards, nutrition labeling, health claims and ingredient declaration. However, permits states to petition FDA for exemption of state requirements from federal preemption of state food labeling, which may be granted if the state shows that the state requirement: 1) would not cause any food to be in violation of any applicable requirement under federal law; 2) would not unduly burden interstate commerce; and 3) is designed to address a particular need for information which is not met by federal law. 5)Defines labeling to mean all labels and other written, printed, or graphic matter upon any article or any of its containers or wrappers, or accompanying such article. This bill: 1)Makes it unlawful for a manufacturer, wholesaler, distributor, or other person to place a claim upon a product declaring the content of the product to be "low saturated fat" or "reduced saturated fat" without also including the phrase "Contains Trans Fat" if the product contains trans fat. 2)Requires the trans fat disclosure to be in the same typeface as the claim. 3)Makes it false and misleading advertising for a manufacturer, wholesaler, distributor, or other person that packages products containing trans fatty acids to willfully or negligently fail to include in a claim that trans fatty acids are present in a product. 4)Specifies that this requirement is only applicable when SB 1580 Page 3 there is a claim made on a product about the low level of saturated fat, as permitted under federal law, when the amount of saturated fat contained in the product does not exceed a specified maximum amount. 5)Defines "hydrogenation" as a process of adding hydrogen to liquid oils, enabling liquid oils to solidify, which increases the shelf life and flavor stability of the liquid oils and the foods that contain those liquid oils. 6)Defines "trans fatty acids" as acids made through the process of hydrogenation that solidifies liquid oils, thereby increasing the shelf life of processed foods containing the liquid oils. 7)Specifies that the intent of the Legislature is to enable California consumers to make knowledgeable choices about food consumption based on the disclosure of information concerning the makeup of that food and cites findings from a report on trans fat, as specified. FISCAL EFFECT: Unknown COMMENTS: 1.Purpose. This bill is sponsored by the Author. According to the Author, SB 1580 will ensure that consumers who rely on "low fat" advertising claims know exactly what is in the food they are buying. This bill requires manufacturers that want to make a "low saturated fat" or "reduced saturated fat" claim to also include as part of the claim that the product contains trans fat. As explained by the Author, there are two types of artery-clogging fats which can be found in foods that many people eat every day. Consumers depend on "Nutrition Facts" labels which FDA requires manufacturers to put on products, and they assume it is an accurate assessment of what they are eating. Currently, nutritional fact panels only list one type of bad fat -- saturated fat -- but the other type of bad fat, trans fat, is not disclosed on the package. The author cites a 1999 cost benefit analysis prepared for FDA that estimated acknowledging trans fat content on SB 1580 Page 4 labels would save an estimated $3 million to $8 million annually in preventing heart disease costs and save approximately 2,000 to 5,000 lives a year. Other countries are also addressing the issue of trans fats in foods. Last year in Denmark, a law was enacted limiting the amount of trans fat in processed foods. Similarly, a bill has been introduced in Canada that proposes that trans fats be limited to no more than 2% of the total fats in processed foods. 2.Background on Trans fat. Trans fatty acids, or trans fat, are made through the process of hydrogenation that solidifies liquid oils. Hydrogenation increases the shelf life and flavor stability of these oils and foods that contain them. It is found in vegetable shortenings, some margarines, crackers, cookies, salted snack foods, and other foods. Hydrogenation is what turns liquid oil into Crisco or stick margarines. Higher intakes of saturated and trans fats and dietary cholesterol raise low density lipoprotein (LDL or "bad") cholesterol in the blood. Trans fat also lowers high density lipoprotein (HDL or "good") cholesterol in the blood. 3.FDA Issued Rule Requiring Disclosure of Trans Fat in July 2003. In 1994, the Center for Science in the Public Interest (CSPI), a consumer advocacy organization, filed a petition (amended in July 1998) with FDA requesting that the agency take steps to require trans fat to be listed on nutrition labels and claims. In response to the CSPI petition, FDA issued a proposed rule in the Federal Register in November 1999 to amend the regulations to address the issue of disclosing trans fat content and the rule became final in July 2003. The ruling requires that trans fat be listed on nutrition labels immediately under saturated fat by January 1, 2006. However, because the final rule did not address nutrient content or health claims for trans fat, FDA has issued an advance notice of proposed rulemaking to: 1) solicit information and data that potentially could be used to establish new nutrient content claims about trans fat; 2) establish qualifying criteria for trans fat in current SB 1580 Page 5 nutrient content claims for saturated fat and cholesterol, lean and extra lean claims, and health claims that contain a message about cholesterol-raising lipids; and 3) establish disclosure and disqualifying criteria to help consumers make heart-healthy food choices. FDA is also requesting comments on whether it should consider statements about trans fat, either alone or in combination with saturated fat and cholesterol, as a footnote in the Nutrition Facts panel or as a disclosure statement in conjunction with claims to enhance consumers' understanding about such cholesterol-raising lipids and how to use the information to make healthy food choices. This open comment period ends April 15, 2004. 4.Benefits of Disclosing Trans Fat. FDA estimates that three years after the January 1, 2006 effective date, trans fat labeling would annually prevent from 600 to 1,200 heart attacks and save 250 to 500 lives. Based on this estimate, the trans fat labeling requirement will realize a cost savings of $900 million to $1.8 billion per year in medical costs, lost productivity, and pain and suffering. 5.Possible Preemption by Federal Law. FDA has determined that the final rule on trans fat has a preemptive effect on state law. Section 403A of the Federal Food, Drug and Cosmetic Act (21 U.S.C. 343-1) is an express preemption provision. That section provides that "no State or political subdivision of a State may directly or indirectly establish under any authority or continue in effect as to any food in interstate commerce" certain food labeling requirements, unless an exemption is provided by the Secretary (and, by delegation, FDA). Relevant to this final rule, one such requirement that States and political subdivisions may not adopt is any requirement for nutrition labeling of food that is not identical to federal requirements. According to FDA, prior to the effective date of the final rule on trans fat, this provision operated to preempt States from imposing nutrition labeling requirements concerning trans fat because no such requirements had been imposed by FDA. Once the rule becomes effective, states will be preempted from imposing any nutritional labeling requirements for trans fat that are not identical to SB 1580 Page 6 those required by this rule. 6.Will Manufacturers Have Sufficient Time to Comply with this Measure? Given the January 1, 2005 implementation date in this bill, would manufacturers have enough time to comply with this bill's requirement? The author may wish to consider giving additional time (i.e., extending the bill's implementation date) for moving out current inventories. 7.Previous Legislation. SB 1610 (Bowen) of 2002 would have required manufacturers and producers of food and dietary supplements for human consumption to include on the label information stating the levels of trans fat in the product, when the manufacturer or producer claims the food product is low in saturated fat. 8.Arguments in Support. Consumers Union believes that this bill is necessary to correct a "serious oversight" in FDA's new regulation on the labeling of trans fat. This omission in the ruling will allow food manufacturers to make that claim that their products are low-fat or fat-free on the front of the food packaging without counting the levels of trans fat in the product. Consumers Union states that such claims are tantamount to deceptive advertising since it is well-known that trans fat lurks in a multitude of "low-fat" foods. The Diabetes Coalition of California (DCC) states that many consumers buy products advertised to be "low fat" because they require a diet low in fat for medical reasons. Hidden trans fats undermine the efforts of individuals to limit unhealthy fat in their diet. DCC believes that providing individuals with diabetes and other consumers with this information will help them make better food choices, and thereby prevent health problems. 9.Arguments in Opposition. Opponents of this bill state that labeling requirement for food products is a federal issue and that the state is preempted from acting in this area by federal law. Opponents also have stated that they are prepared to label trans fat and support the FDA process. The food industry asserts that it is actively engaged in the design and manufacturing processes required to ensure that all SB 1580 Page 7 products are in compliance with the January 1, 2006 deadline. There is concern that if California dictates a different standard for labeling, food processors and manufacturers will be subject to a patchwork of conflicting and inconsistent state regulations. The National Food Processors Association believes that the requirements imposed by the bill would impede commerce. 10.Suggested Amendment. Though this bill adds provisions to the false and misleading advertising section of the Business and Professions Code (Section 17500 et seq.), it only prescribes what can or cannot be on the label and is not applicable to other advertising situations. The Author may wish to expand the disclosure of trans fat to include other types of advertising relating to products (i.e., ads on television or in magazines). In the event that the current labeling requirement in this bill is preempted by federal law, then advertising which is not preempted would still stand. If the Author decides to amend the bill to extend the trans fat disclosure to include all advertising, a severability clause should be inserted to ensure that if any provision of the bill is held invalid, that invalidity shall not affect other provisions of the bill. NOTE: Double-referral to Judiciary Committee SB 1580 Page 8 SUPPORT AND OPPOSITION: Support: California Alliance for Consumer Protection Consumers Union Diabetes Coalition of California Opposition: California Chamber of Commerce California League of Food Processors Dairy Institute of California Grocery Manufacturers of America National Food Processors Association Consultant:Robin Hartley