BILL ANALYSIS Ó
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|Hearing Date:May 6, 2013 |Bill No:SB |
| |465 |
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SENATE COMMITTEE ON BUSINESS, PROFESSIONS
AND ECONOMIC DEVELOPMENT
Senator Curren D. Price, Jr., Chair
Bill No: SB 465Author:Correa
As Amended:April 23, 2013 Fiscal: No
SUBJECT: Packaging and labeling: containers: slack fill.
SUMMARY: Specifies that the presence of non-functional slack fill in
a package is required for a violation of any of the container-related
provisions of the Fair Packaging and Labeling Act or the Sherman Food,
Drug, and Cosmetic Law; specifies that non-functional slack fill is
the empty space in a package that is filled to substantially less than
its capacity for other than any one or more of specified reasons;
specifies that where required, the actual size of the product may be
depicted on "any side" of the exterior packaging; declares that the
changes made by the bill are declaratory of existing law.
Existing law:
1)Establishes the Fair Packaging and Labeling Act (Act) and provides
for enforcement of the Act by the Department of Food and Agriculture
(DFA). (Business and Professions Code (BPC) § 12601 et seq.)
2)Declares that the Act is designed to protect purchasers of any
commodity within its provisions against deception or
misrepresentation, and that packages and their labels should enable
consumers to obtain accurate information as to the quantity of the
contents and should facilitate value comparisons. (BPC § 12601)
3)Prohibits commodities (i.e., non-food commodities) from being
packaged for distribution that is not in conformity with prescribed
packaging and labeling requirements, except as provided. (BPC §
12602)
4)Establishes certain requirements for containers used for distribution
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or sale of commodities including: (BPC § 12606)
a) Prohibits a container in which commodities are packed to have
a false bottom, false sidewalls, false lid or covering, or to be
constructed or filled as to facilitate the perpetration of
deception or fraud. (BPC § 12606 (a))
b) Prohibits a container from being made, formed, or filled as to
be misleading. Provides that a container that does not allow a
consumer to fully view its contents violates this provision if it
contains non-functional slack fill. (BPC § 12606 (b))
c) Provides that "slack fill" is the difference between the
actual capacity of a container and the volume of product
contained therein. (BPC § 12606 (b))
d) Provides that "non-functional slack fill" is the empty space
in a package that is filled to less than its capacity for reasons
other than those specified including: (BPC § 12606 (b))
i) For unavoidable product settling during shipping and
handling;
ii) Where mandatory labeling requirements necessitate
extra packaging;
iii) To discourage pilfering or to accommodate
tamper-resistant devices;
iv) Where extra space, such as head space, is needed for
the mixing or adding of liquids or powders prior to use; and,
v) Where the contents are designed to serve a particular
function that is clearly disclosed on the exterior packaging,
such as computer hardware or software.
1)Prohibits food containers subject to the Federal Food, Drug, and
Cosmetic Act, from being made, formed, or filled as to be
misleading, as specified. (BPC § 12606.2)
a) Provides that a container that does not allow a consumer to
fully view its contents violates this provision if it contains
non-functional slack fill. (BPC § 12606.2 (c))
b) Provides that these state provisions regarding food containers
are operative only to the extent they are identical to specified
federal requirements. (BPC § 12606.2 (e))
2) Establishes, the Sherman Food, Drug, and Cosmetic Law, and provides
for regulation under that law by the State Department of Public
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Health of the packaging and labeling of foods , drugs , devices , and
cosmetics . (Health and Safety Code (HSC) § 110375)
a) Establishes requirements for containers containing these
commodities that are similar to the requirements for containers
under the Fair Packaging and Labeling Act, described in Item # 4)
above.
3)Authorizes any sealer to seize a container in violation of these
provisions of law, and provides that by order of the Superior Court
the containers seized shall be condemned and destroyed or released
upon conditions imposed by the court against their use in violation
of the Act.
(BPC § 12606 (c); 12606.2 (f); HSC § 110375 (d))
This bill:
1)Amends the packaging requirements described above pertaining to
non-food commodities and food containers in Fair Packaging and
Labeling Act, and in the Sherman Food, Drug and Cosmetic law as
described below:
a) Specifies that the presence of non-functional slack fill in a
package is required for a violation of any of the
container-related provisions.
b) Specifies that non-functional slack fill is the empty space in
a package that is filled to substantially less than its capacity
for other than any one or more of the specified reasons.
c) Specifies that where the actual size of the product is clearly
and conspicuously depicted on the exterior packaging, as
specified, it may be depicted on "any side" of the exterior
packaging.
2)Declares that the changes made by the bill do not constitute a change
in, but are declaratory of existing law.
FISCAL EFFECT: This bill has been keyed "non-fiscal" by Legislative
Counsel.
COMMENTS:
1.Purpose. This bill is sponsored by the Personal Care Products
Council , and the Grocery Manufacturers Association (Sponsors) to
make changes to the California Fair Packaging & Labeling Act, and
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the Sherman Food, Drug, and Cosmetic Law to clarify the
interpretation of the law relating to slack fill.
According to the Sponsors, for years, all parties abided by the slack
fill enforcement guidelines, now, sixteen years after the
codification of the slack fill exemptions, companies suddenly face
renewed (and inconsistent) enforcement actions in California for
their product packaging, even though such packaging meets one of the
15 enumerated statutory exemptions. The Sponsors state that the
reason for the current enforcement efforts is, ostensibly, that
packaging with non-functional slack fill is misleading, even if it
meets an exemption, and thus violates the statute. In other words,
the Sponsors argue, many have resurrected an older rationale that
packaging with nonfunctional slack fill is per se illegal, whether
the packaging meets one of the enumerated exemptions or not.
The Sponsors believe that this is a clear misinterpretation (or
perhaps reinterpretation) of the plain language of the statute, and
completely ignores the purpose of the exemptions placed into law by
the California Legislature in 1997. The Sponsors indicate that
slack fill violations can result in harsh monetary penalties and can
force manufacturers to spend millions of dollars modifying packaging
for products sold in California and around the world.
According to the Sponsors, SB 465 would fix this inequitable situation
by clarifying the application of the slack fill exemptions already
codified in law.
2.Background. Both the federal and California laws have addressed the
issue of misleading packaging for consumer products, and
specifically, "slack fill" - which is the impermissible empty space
between the actual container capacity and the volume of the product
contained therein.
a) Federal Law . The federal Food, Drug & Cosmetic Act in 1938
(21 U.S.C. 301 et seq) explicitly prohibited misleading
packaging for FDA regulated products. In 1966, the Fair
Packaging and Labeling Act was enacted and referred to the
concept of nonfunctional slack fill. The law also had a
provision authorizing FDA to adopt regulations to "prevent the
nonfunctional slack fill of packages" containing food, drugs,
devices, or cosmetics.
(FPLA, §5(c)(4))
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In 1994, the FDA promulgated regulations establishing general
principles on non-functional slack fill:
(a) A container that does not allow the consumer to fully view its
contents shall be considered to be filled as to be misleading if
it contains nonfunctional slack fill. Slack fill is the
difference between the actual capacity of a container and the
volume of product contained therein. Nonfunctional slack fill
is the empty space in a package that is filled to less than its
capacity for reasons other than specified. (21 CFR 100.100 (a))
According to the regulation, if a container does allow a consumer
to view the full contents of the package (such as with a
transparent side-wall) it is not misleading. However, if a
container does not allow a consumer to view the contents and it
contains non-functional slack fill, it is deemed misleading,
unless it meets a specified exemption. The regulation goes on
to list six exemptions, or safe harbors, to the above
prohibition against misleading packaging; including, for
example, exempting use of non-functional slack fill when
necessary to protect the contents of the package, the
requirements of machines used for packaging, or the settling of
the product during shipping or handling.
b) California Law . Similar to federal law, California's Fair
Packaging and Labeling Act (BPC §§12601-12615.5) governs
misleading packaging of consumer products. Specifically, BPC
§12606 prohibits a container from containing a false bottom or
side or lid, or to be filled in such a way as to promote
deception or fraud.
In 1997, AB 1394 (Figueroa, Chapter 711, Statutes of 1997) was
enacted to further prohibit a container from being made or
filled as to be misleading, and provide that a container that
does not allow the contents to be viewed shall be considered
misleading if it contains non-functional slack fill. The law
specifies that slack fill is the empty space in a package that
is filled to less than its capacity and describes 15 exceptions
to the non-functional slack fill provisions:
(1) Protection of the contents of the package.
(2) The requirements of machines used for enclosing the
package.
(3) Unavoidable product settling during shipping and handling.
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(4) The need to use a larger package or for the legible
presentation of mandatory and necessary labeling information.
(5) Packaging in a decorative or representational container
where the container is part of the presentation of the product
and has value independent of its function to hold the product
(such as a gift with a container that is intended for further
use after the product is consumed, or durable commemorative or
promotional packages).
(6) Where minimum package size is necessary to accommodate
required labeling, discourage pilfering, facilitate handling,
or accommodate tamper-resistant devices.
(7) The container bears a reasonable relationship to the
actual amount of product inside, and the dimensions of the
container, the product, or the amount of product inside is
visible to the consumer.
(8) The dimensions of the product or product container can be
seen through the exterior packaging, or where the actual size
of the product or product container is shown on the exterior
packaging, accompanied by a clear and conspicuous disclosure
that the representation is the "actual size" of the product or
the product container.
(9) The presence of any headspace within a product container
necessary to facilitate mixing, adding, shaking, or dispensing
by the consumer prior to use.
(10) The exterior packaging contains a product delivery or dosing
device, as shown or
described, as specified.
(11) The packaging or product container is a kit that consists of
multiple components, as
specified, if the purpose of the kit is clearly and
conspicuously disclosed on the
exterior packaging.
(12) The packaging of the product is routinely displayed using
tester units or
demonstrations to consumers in retail stores, so that customers
can see the container
of the product being sold or the actual size of the product,
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prior to purchase.
(13) The packaging consists of one or more presentation boxes of
holiday or gift packages
if the purchaser can adequately determine the quantity and
sizes of the product
container when sold.
(14) The packaging is for the purchased product, together with a
free sample or gift, as
specified, if both products and their quantity are clearly and
conspicuously disclosed
on the exterior packaging.
(15) The packaging or product container is for computer hardware
or software, and if the
function of the hardware or software is clearly and
conspicuously disclosed on the
exterior packaging.
3.Prior Legislation. AB 1394 (Figueroa, Chapter 711, Statutes of
1997), revised the general requirements for commodities containers
under the Fair Packaging and Labeling Act, to generally conform to
the requirements for food containers. The bill amended the slack
fill law which defined certain types of packaging as misleading, and
therefore illegal. At that time there were only two narrow
exemptions to the law: (1) For protecting the contents of the
package and, (2) For requirements of machines used to enclose the
contents in the package. However, at that time district attorneys
generally operated on the basis of Slack Fill Enforcement Guidelines
agreed to in 1988 by the Attorney General, the Department of Food
and Agriculture and the California Association of Weights and
Measures Officials. AB 1394 expanded the two exemptions to fifteen
exemptions, in order to more carefully define misleading and
fraudulent packaging practices, yet establish reasonable parameters
to the slack fill law which takes into account the needs of
consumers, as well as the wide range of product packaging needs for
businesses.
SB 735 (Marks, Chapter 849, Statutes of 1995), pertained to food
containers and not to other packaged commodities. The bill was
jointly sponsored by the Los Angeles District Attorney and Ventura
District Attorney to conform California law to federal law (the
federal Food, Drug and Cosmetic Act).
AB 1295 (Caldera, 1997), proposed to make major changes to the Unfair
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Practices Act
(BPC § 17000 et seq.) and sought restrictions on the ability to bring
lawsuits alleging unfair competition or false advertising and
seeking monetary recovery for a number of product manufacturers,
including software manufacturers who package computer software in
containers larger than necessary to hold the disk. That bill was
strongly opposed, and failed passage in the Assembly Judiciary
Committee. Although the bill failed passage in Committee, a number
of members expressed interest in addressing the consumer packaging
issues, ultimately resulting in the amendments contained in AB 1394.
4.Arguments in Support. Writing in support of the bill is a
coalition, which includes the Sponsors of the bill, the Personal
Care Products Council and the Grocery Manufacturers Association , as
well as other proponents, including the Advanced Medical Technology
Association , American Cleaning Institute , BAYBIO , BIOCOM , California
Chamber of Commerce , California Farm Bureau Federation , California
Healthcare Institute , California Manufacturers and Technology
Association , California Retailers Association , Consumer Heathcare
Products Association , Consumer Specialty Products Association ,
Pharmaceutical Researchers and Manufacturers of America (PhRMA),
state the following:
"SB 465, which would clarify existing law that if a package
satisfies one of the non-functional slack fill exemptions, the
package is exempt from liability under the Code Sections.
Further, SB 465 would reiterate that actual size illustrations
of the product or container may appear on any side of the
external packaging.
Enforcement actions levied against a manufacturer can result in
harsh monetary penalties and force manufacturers to spend
millions modifying packaging for products sold in California and
around the world. For packaging that clearly violates the
statute and fails to qualify for one of the enumerated
exemptions, this is just. However, those companies who were in
compliance with the law should not be subjected to frivolous
enforcement actions for which they will necessarily have to
fight, thereby increasing product costs and compromising product
availability for a product that was on the right side of the law
to begin with."
5.Arguments in Opposition. The California District Attorneys
Association (CDAA) argues that the bill would seriously weaken
existing law that prohibits the use of unnecessarily large
containers to mislead consumers into believing that they are
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receiving more product than is actually the case.
CDAA states that current law declares a package unlawful if: (1) the
container is constructed or filled so as to facilitate the
perpetration of deception or fraud; (2) the container is made,
formed, or filled so as to be misleading; or (3) if the consumer
cannot fully see the container's contents, the container is by
definition misleading if it contains "nonfunctional slack fill."
CDAA indicates the current "nonfunctional slack fill" definition was
made in 1997 by a cooperating working group of public officials and
industry representatives in AB 1394 (Figueroa). CDAA contends the
bill would entirely eliminate the first two methods of violating the
section and would add an additional burden in establishing the
existence of nonfunctional slack fill.
CDAA additionally indicates that the FDA rejected the approach
proposed in SB 465, of adding the word "substantially" to modify
"nonfunctional slack fill" in the parallel federal statute
indicating the word "would create serious uncertainty and problems
of interpretation."
Finally, CDAA argues:
"SB 465 weakens needed protections for consumers and honest
businesses. The current version of the bill would weaken
important consumer protection and impose significant new burdens
on appropriate law enforcement actions, leading to the loopholes
and confusion that the FDA cited in rejecting the term. Pending
and future law enforcement cases, brought by the California
Attorney General and district attorneys to protect the public
from misleading packaging, would also be needlessly undermined by
the inaccurate statement that these amendments are declaratory of
existing law. Most importantly, SB 465 in its current form would
harm consumers, who will be misled into believing that they are
receiving more product than they are, and would harm honest
businesses that do not use deceptive packaging and want a level
playing field."
SUPPORT AND OPPOSITION:
Support:
Personal Care Products Council (Sponsor)
Grocery Manufacturers Association (Sponsor)
Advanced Medical Technology Association
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American Cleaning Institute
BAYBIO
BIOCOM
California Chamber of Commerce
California Farm Bureau Federation
California Healthcare Institute
California Manufacturers and Technology Association
California Retailers Association
Consumer Heathcare Products Association
Consumer Specialty Products Association
Pharmaceutical Researchers and Manufacturers of America
Opposition:
California District Attorneys Association
Consultant:G. V. Ayers