New Food Labeling Regulations and Optimal Ways for Their Implementation Policy Paper

This framework requires an extensive approximation of norms and regulations in various sectors, including food labeling. New regulations required by approximation can cause high compliance costs, particularly in the agriculture and food processing sector, which is underdeveloped in Georgia compared to EU countries. The AA does not obligate Georgia to copy laws from the EU. Rather, approximated laws need not be more trade-restrictive than necessary to fulfill a legitimate objective. The evaluation of progress in the approximation process is guided by general principles outlined in Annex XI-A of the AA. These principles emphasize the importance of gradually approximating Georgia's sanitary, phytosanitary, and animal welfare laws to those of the EU, based on the approximation list of the EU sanitary, phytosanitary, and animal welfare law. Georgia must approximate domestic rules to the EU acquis by either implementing and enforcing additional domestic rules or procedures or by amending existing relevant domestic rules or procedures. In either case, Georgia must eliminate any laws, regulations, or measures inconsistent with the approximated domestic legislation and ensure the effective implementation of approximated domestic legislation. This policy paper addresses food labeling requirements within the general food safety regulation. It is essential to distinguish the boundary between food safety and food labeling to focus the discussion on food-labeling-specific issues. Food safety refers to measures taken to ensure that food is safe to consume, covering food processing, allowed ingredients, expiration dates, and so forth. Food labeling, on the other hand, refers to measures taken to provide necessary information to consumers so that they can make an informed choice when buying, including producer, list of ingredients, expiration date, and so forth. The authors of this policy paper met with key informants, representatives of government and business, and organized a public-private dialogue to understand concerns vis-à-vis new food labeling requirements. Their comments and insights were synthesized into five policy issues and recommendations for solving the root causes of the policy issues. The policy issues and recommendations are as follows: Gaps in the cattle identification system can cause problems for the implementation of beef labeling regulation. Requirements for beef labeling should come into force after all problems in the animal registration system are solved. Businesses worry they will be caught unaware by new food labeling requirements. Methods used to communicate with food business operators should be improved. Food business operators do not know how to develop the nutrition claim portion of food labels. The National Food Agency (NFA) should provide clear guidance to businesses on how to determine the content of the nutrition claim section of food labels. Penalties for violations of food labeling requirements appear disproportionate to the risk stemming from non-compliance. The food-labeling-penalty system should be rebalanced to properly match fine value against risks to human health. The right of company confidentiality and the right of the public to know have not been properly balanced. Rules governing the balance between the public's right to know and a company's right to confidentiality should be debated and set. The AA and DCFTA offer Georgia a framework for modernization, but the negative impacts on Georgian producers from the approximation of laws should be minimized. The approximation process should run as harmlessly as possible, and intensive dialogue with all stakeholders is essential to identify potential compliance costs and minimize them.