Bayer New Zealand Limited v Ministry for Primary Industries
[2020] NZHC 789
•22 April 2020
IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY
I TE KŌTI MATUA O AOTEAROA TE WHANGANUI-A-TARA ROHE
CIV-2020-485-333
[2020] NZHC 789
UNDER THE Declaratory Judgments Act 1908 and Part 18 of the High Court Rules 2016 BETWEEN
BAYER NEW ZEALAND LIMITED
Plaintiff
AND
MINISTRY FOR PRIMARY INDUSTRIES
Defendant
Hearing: 2 December 2019 Appearances:
S V McKechnie and J R Meager for Plaintiff E N C Lay and D J Watson for Defendant
Judgment:
22 April 2020
JUDGMENT OF GRICE J
Contents
Introduction [1]
The Berocca range [5]
Berocca Forward [12]
The issue [17]
The declarations sought [24]
The Food Standards [30]
Formulated caffeinated beverage (FCB) standard [37]
The Food Act 2014 [44]
Where does Berocca Forward fit in? [50]
The purpose [51]
Expert evidence [66]
Enhancing mental performance [71]
Non-complying additives [73]
An energy drink [81]
Is Berocca Forward an FCB? [88]
Other matters – change to standards [93]
Conclusion [95]
Costs [98]
Commercially sensitive material [99]
BAYER NEW ZEALAND LIMITED v MINISTRY FOR PRIMARY INDUSTRIES [2020] NZHC 789 [22 April 2020]
Introduction
[1]Bayer distributes the Berocca® range of products in Aotearoa New Zealand.
[2] The range includes Berocca Performance, Berocca Kick and Berocca Focus 50+ which are all effervescent tablets. These are dissolved in water to make a drink. Berocca Fizzy Melts a chewable tablet, is also in the range as is the effervescent drink, Berocca Forward.
[3] Both Berocca effervescent tablet products are labelled “dietary supplements”. This is a classification under the New Zealand Food Classification regime.
[4] This case is about the Berocca Forward effervescent drink and its proper classification under the Australia/New Zealand Food Standards Code (the Food Code). At present it is labelled as a “supplemented food” under the New Zealand Food (Supplemented Food) Standard 2016. The Ministry says this is not the correct classification for the product.
The Berocca range
[5] The Berocca range of products is well-known and established in the New Zealand market. Berocca Forward is a carbonated drink which contains caffeine. It comes in a slim 250 ml can or a 330 ml glass bottle. It is identifiable as one of the Berocca family of products by its labelling. The three products, Berocca Kick and Performance (tablet capsules and boxes) and Berocca Forward (the can shown in the centre) appear in the following photograph:1
1 These products were handed up at the hearing.
[6] Berocca Performance is labelled as a “dietary supplement”. It does not contain caffeine. The labels on its box and tube2 feature the words “Mental Sharpness” and “Physical Energy”. The label on the box reads:
How does Berocca Performance work?
Berocca Performance is a unique combination of high dose B complex vitamins, vitamin C and essential minerals, like calcium, magnesium and zinc, which work to support your mental sharpness and physical energy through out the day.
[7] The Berocca Kick label refers to “mental alertness” and “physical energy”. It contains a reference to “vitamins, minerals and guarana”. Guarana contains naturally occurring caffeine. The label says that Berocca Kick contains about as much caffeine as an average cup of coffee. The label further states:
What is Berocca Kick?
Berocca Kick is the fast natural fuel you need to give you a quick effective boost whenever you need it. Berocca Kick contains Guarana, a fast-acting, natural energiser and is packed with a unique combination of B vitamins and minerals to give you a little kick when you need it.
[8] The Berocca Performance and Berocca Kick tablets are packaged in distinctive green packaging with orange highlights and the word “Berocca” appearing within a silver lozenge shape.
[9] The Berocca Forward labelling uses the range’s orange colour as the predominant colour with the green as the highlight. The silver lozenge outline around the word Berocca is also present.
[10] Following the success of the soluble tablet products, Bayer gauged consumer demand for a Berocca product that was ready to drink rather than in tablet form. So it launched ‘Berocca Forward’ to meet that demand.
[11] Approximately three million cans and 350,000 bottles (865,500 litres) of Berocca Forward have been manufactured and distributed for sale in New Zealand to date.
2 It comes in a box with a tube containing the tablets inside.
Berocca Forward
[12] Berocca Forward is an effervescent drink which contains caffeine. It is common ground that caffeine has physiological effects on a consumer which acts in addition to any nutritive provision from the other ingredients.3
[13] The can reads “with Vitamins, Minerals and Guarana”. Berocca Forward is described as a vitamin and mineral supplemented food. The food classification on the label is “supplemented food” (SF). The labelling on the can does not lay claim to any mental or physical effects, unlike the labelling on the tablet products.
[14] The Ministry for Primary Industries – Manatū Ahu Matua (MPI), is the regulator of food products, including “dietary supplements” and “supplemented food”, in New Zealand. It says Berocca Forward is not a “supplemented food” and so should not be labelled as such. Nevertheless, MPI has no concerns about the safety of the product so it says it has no plans to prosecute Bayer for labelling the product as a “supplemented food” at present.
[15] MPI says Berocca Forward is properly classified as a “formulated caffeinated beverage” (FCB). It says Berocca Forward is non-compliant with that FCB classification because it contains additives, vitamins and minerals (Vitamin C, magnesium and zinc) which are not listed as substances permitted to be added to FCBs. MPI says Berocca Forward is a non-compliant FCB.
[16] Bayer disagrees with MPI. It says it is entitled to label Berocca Forward as a “supplemented food”. This is because the product does not fall squarely within any prescribed standards classification but could fall into one of two overlapping categories. Therefore, it says it should be entitled to choose the classification to which it belongs. Bayer’s choice is for Berocca Forward to be classified and labelled as a “supplemented food” not an FCB.
3 See [70].
The issue
[17] The parties say that the nub of their dispute is that MPI disagrees with Bayer’s view that Berocca Forward satisfies the requirements of a “supplemented food” under the SF Standard. MPI says the product includes vitamin C, magnesium and zinc which make it non-compliant as an FCB but that does not mean it is a “supplemented food”. It is just a non-complying FCB.
[18] Bayer says confusing food standards and classifications have led to Berocca Forward being caught between overlapping classifications. On the other hand, MPI says the classifications do not overlap. They are discrete despite some grey areas around the edges.
[19] Initially Bayer had opted to classify Bayer Forward as a “dietary supplement”. Once MPI pointed out that it was not a “dietary supplement” as it did not comply with the Dietary Supplements Regulations 1985, Bayer decided in February 2017 to change the classification set out on the labelling to “supplemented food”. At the time Bayer said it did not concede that its previous classification was incorrect. MPI was of the view that Berocca Forward was an FCB. Bayer disagreed. It said that the product could not be an FCB as it did not comply due to the non-compliant ingredients that Bayer puts into the drink.
[20] At that time however Bayer removed claims of “mental sharpness” for Berocca Forward from its labelling and the website. Bayer said that the product now made no claim to “enhancing mental performance”. Without that claim Bayer said the purpose of the drink was no longer caught by the definition of FCB.
[21] Bayer says that the classification of Berocca Forward as a “supplemented food”:
(a)has the support of an expert committee convened by the representative beverage industry;
(b)has additives which make it non-compliant with the FCB classification; and
(c)the product does not have the purpose of enhancing mental performance. Such a purpose is required in the definition of “formulated caffeinated beverage”.
[22] Bayer says it has now taken all reasonable steps to ensure the product is compliant with labelling requirements for “supplemented foods”. This includes the relabelling of the product from “dietary supplement” to “supplemented food”, removing health claims (references to mental sharpness and physical energy) from the label and taking down the product’s website which had made those claims. However, Bayer has declined to alter the label to remove the words Supplemented Food despite MPI’s position that this is the incorrect classification.
[23] MPI maintains that as the product is an FCB under the relevant food standard it cannot be a “supplemented food”. At present it is a non-compliant FCB but upon the removal of the additives it could lawfully be sold as an FCB.
The declarations sought
[24] Bayer brings these proceedings under the Declaratory Judgments Act 1908 (the Act) to clarify matters. It does not want to take the risk of continued uncertainty. MPI indicated it did not intend to prosecute the parties and so agreed that an application for a declaratory judgment was the best way to clarify the issue for Bayer.
[25] Bayer pointed out the remedy is discretionary but noted that the jurisdiction under the Act was wide enough to deal with the declaration sought. The Court “may, on any grounds which it deems sufficient refuse to give or make any such judgment or order”.4
[26] A declaration is only binding on the person making the application and on all persons on whom the summons has been served.5
[27]The form of declarations sought by Bayer are:
4 Declaratory Judgments Act 1908, s 10. Re Chase [1989] 1 NZLR 325 at 333 (CA).
5 Declaratory Judgments Act 1908, s 4.
(a)The product is not an FCB under the FCB Standard of the Food Code;6
(b)The product may be labelled and sold as a “supplemented food” under the SF Standard; and
(c)A company may choose how it classifies a food under any regulatory classification, so long as the food is compliant with the legal requirements of the regulatory classification chosen.
[28] Bayer seeks the last declaration as it says it would resolve a general uncertainty that producers and distributors of food products face when a product could belong to two different classifications.
[29]On the other hand, MPI seeks declarations to the opposite effect as follows:
(a)The product meets the definition of an FCB in the Food Code (and therefore must comply with the FCB Standard);
(b)The product is therefore excluded from the definition of a “supplemented food” under the SF Standard; and
(c)All food must comply with the relevant parts of the Food Code as it applies to that particular food. A company cannot unilaterally determine which standards apply to its food.
The Food Standards
[30] Food Standards Australia New Zealand (FSANZ) has responsibility for developing, varying and reviewing food standards applicable in Australia and New Zealand. It developed the joint Australia/New Zealand Food Standards Code7 (the Food Code) which sets out requirements for food safety including labelling and composition of food and food related products.
6 Australia/New Zealand Food Standards Code, std 2.6.4.
7 Food Act 2014, s 397.
[31] The enforcement and policing of the standards are dealt with under local New Zealand food legislation. The Food Act 2014 (the Act) is the umbrella legislation. MPI is responsible for administering that Act.
[32]
The Food Act provides a framework and the authority for a number of key food regulations and standards. The framework may be represented diagrammatically as follows:
[33] The regulatory framework has been described as regulating across a food/medicine continuum moving from food regulation at one end to “supplemented foods” and “dietary supplements” to medicines at the other.
[34] The Act prescribes the food additives, nutritive substances and processing aids that are permitted as well as what health claims can be made about various additives, including vitamins and minerals. The standards deal with labelling and information requirements (including permissible nutrition and health claims), substances and contaminants and processing requirements which apply to all foods.
[35] The Minister may adopt joint food standards under s 397 of the Food Act 2014. The effect of adopting a joint food standard is that a person who manufactures, sells or prepares food for sale in New Zealand must comply with the requirements of the adopted food standard in relation to that food.8
8 Section 397(4).
[36] The Food Code 2002 issued under the Food Act is made up of a number of standards arranged into chapters. FSANZ develops and maintains the Food Code. The Code Standards for FCBs and “supplemented foods” are the governing standards in dispute here.
Formulated caffeinated beverage (FCB) standard
[37] Standard 1.1.2 – 6, defines “formulated caffeinated beverage” (FCB) as follows:9
(1)In this Code:
formulated caffeinated beverage means a flavoured, non-alcoholic beverage, or a flavoured, non-alcoholic beverage to which other substances (for example, carbohydrates, amino acids, vitamins) have been added, that:
(a) contains caffeine; and
(b) has the purpose of enhancing mental performance.
(2)To avoid doubt, a formulated caffeinated beverage is a water based flavoured drink for the purposes of item 14.1.3 of section S15–5, and section S18–10.
[38] Standard 2.6.4 regulates FCBs (the FCB standard). Standard 2.6.4 – 3 sets out the composition of FCBs as follows:10
Composition–formulated caffeinated beverages
A formulated caffeinated beverage:
(a)must contain no less than 145 mg/L and no more than 320 mg/L of caffeine in total, from any source; and
(b) may contain a listed substance. (Emphasis added)
[39]The balance of the provisions in standard 2.6.4 cover:
· A prohibition on mixing FCBs;11 and
9 Australia/New Zealand Food Standards Code, std 1.1.2.
10 Standard 2.6.4 – 3.
11 Australia/New Zealand Food Standards Code, std 2.6.4 – 4.
· The labelling requirements for FCBs such as recommended daily quantities and a warning that the product is not suitable for certain types of people.12 It sets out requirements as to placement on labelling of the relevant declarations. It also sets out the manner in which the one-day quantity limits are to be calculated.
[40] The “Listed substances” mentioned in standard 2.6.4 is a list of substances and permitted amounts set out in a table referred to in the Food Code as follows:13
Column 1
Substance
Column 2
Permitted amount
Thiamin Riboflavin Niacin
Vitamin B6 Vitamin B12
Pantothenic acid Taurine Glucuronolactone Inositol
40 mg
20 mg
40 mg
10 mg10 mg
10 mg
2000 mg
1200 mg100 mg
[41] Vitamin C, magnesium and zinc which are the additives to Berocca Forward, are not listed substances permitted as ingredients in an FCB. The addition of those substances to an FCB is not authorised by any other provision in the Food Code.
[42] “Supplemented foods” fall under the New Zealand Food (Supplemented Food) Standard 2016.14 The meaning of “supplemented food” is as follows:
1.3 Meaning of supplemented food
(1)A supplemented food is a product that is represented as a food that has a substance or substances added to it, or that has been modified in some way, to perform a physiological role beyond the provision of a simple nutritive requirement.
(2)The following products are not supplemented foods:
(a)a dietary supplement (as defined in the Dietary Supplements Regulations 1985);
(b)a medicine (as defined in the Medicines Act 1981);
12 Standard 2.6.4 – 5.
13 Schedule 28, s S28 – 2.
14 Issued under s 11C of the Food Act 1981.
(c)a controlled drug or restricted substance (as defined in the Misuse of Drugs Act 1975);
(d)a formulated meal replacement or a formulated supplementary food (as defined in standard 1.1.2–2 of the Code):
(e)a formulated caffeinated beverage (as defined in standard 1.1.2–6 of the Code).
(3)To avoid doubt, subclause (2) does not contain an exhaustive list of products that are not supplemented foods.
(Emphasis added.)
[43] Therefore a beverage which falls under the definition of an FCB is not a “supplemented food” under the SF standard.
The Food Act 2014
[44] Bayer says the interpretation of the standards must be undertaken in the context of the purpose of the Food Act 2014 (the Act).
[45]The Act has as its purpose as relevant:
4 Purpose
The purpose of this Act is to—
…
(b)achieve the safety and suitability of food for sale; and
(c)maintain confidence in New Zealand’s food safety regime; and
(d)provide for risk-based measures that—
(i)minimise and manage risks to public health; and
(ii)protect and promote public health; and
(e)provide certainty for food businesses in relation to how the requirements of this Act will affect their activities; and
(f)require persons who trade in food to take responsibility for the safety and suitability of that food.
[46] A person who trades in food is responsible to “ensure that it is safe and suitable”.15
[47] Related to the purpose are concepts of “safety” and “suitability” which are defined at s 12 as follows:
12 Meaning of safety and suitability
(1)In this Act, unless the context otherwise requires, safety and suitability, in relation to food, have the meanings set out in subsections
(2) and (3) respectively.
(2)Safety means a condition in which food, in terms of its intended use, is unlikely to cause or lead to illness or injury to human life or public health.
(3)Suitability means a condition in which the matters specified in—
(a)subsection (4) are appropriate to food in terms of its intended use; and
(b)subsection (5) do not apply.
(4)The matters referred to in subsection (3)(a)—
(a)include the composition, labelling, identification, and condition of the food; but
(b)do not include—
(i) matters that are directly related to the food’s safety; or
(ii) matters of quality or presentation of the food that relate to a purely commercial decision by the person trading in the food.
[48] Bayer says that the purposes of the Food Act are primarily to promote the safety of food but also relevantly to promote certainty for food businesses in relation to the requirements of the Act. It points to its need for certainty about the standard which applies to Berocca Forward.
15 Food Act 2014, s 14.
[49] The usual rules of interpretation apply here. Interpretation commences with the text informed by the purpose and the context,16 including the statutory scheme of the relevant legislation.17
Where does Berocca Forward fit in?
[50] Ms McKechnie says Berocca Forward is not an FCB because first it does not claim to or have the purpose of enhancing mental performance and secondly it does not comply with the FCB standard.
The purpose
[51] Ms McKechnie says the definition of an FCB requires the product to have the purpose of enhancing mental performance.18 She submits that this is not the purpose of Berocca Forward. She points out that on the present labelling there is nothing referring to “mental performance”. This contrasts with the Berocca tablets’ labelling which refers to mental sharpness and mental alertness for Berocca Performance and Berocca Kick respectively.
[52] Ms McKechnie noted that initially on the labelling of Berocca Forward the words “mental sharpness” and “physical energy” had appeared and similar claims were made on the related website. However, those claims were removed from the labelling and the website. Ms McKechnie said it was not out of the ordinary to make such changes to labelling and promotional material for marketing purposes or because of a regulatory problem as had occurred in the present case. She said that those past claims did not affect the present purpose of the product. Ms McKechnie said the present purpose of the product was a commercial purpose of expanding the availability of the Berocca range of products to include a Berocca ready-to-drink product.
16 Interpretation Act 1999, s 5. Commerce Commission v Fonterra Co-Operative Group Ltd [2007] NZSC 36; [2007] 3 NZLR 767 at [24].
17 Westfield (NZ) Ltd v North Shore City Council (2005) NZSC 17, [2005] 2 NZLR at 597 at [6].
18 See [37] above.
[53] Ms Lay for MPI contends that “purpose” as it appears in the definition of FCB19 includes intended use. She pointed to the definition of intended use in the Food Act is as follows:20
intended use, in relation to food, means the use for the food that is specifically stated, or could reasonably be presumed to be intended, taking into account the food’s nature, labelling, packaging and identification
[54] Ms Lay said past claims as to Berocca Forward’s benefits could be relevant to determining the purpose of the product. She pointed to cases involving criminal charges in which the word “purpose” had been considered.
[55] In Thompson v Police21 Tompkins J had to consider the purpose for which a defendant had for a pipe found in his possession. The Judge found that the defendant had “the intention” to use the pipe in the future for smoking cannabis. This finding was based on the evidence that the defendant had used it for that purpose in the past.
[56] Ms McKechnie criticised the case as being both old and relating to the criminal law which she said was inappropriate in the present context.
[57] The ordinary dictionary meaning of “purpose” is “a thing to be done; an object to be attained, an intention, an aim”.22
[58] In my view an ordinary reading of the word ‘purpose’ in the context in which it is used in the definition of FCB, includes the aim intended to be attained by use of the product as likely to be perceived by a targeted customer.
[59] This is consistent with the s 2 definition of “intended use”. It includes a use “specifically stated” or which “could reasonably be presumed to be intended, taking into account the food’s nature, labelling, packaging and identification.” This is in line with the purpose of the Food Act which is primarily directed to the safety and suitability of products.
19 Australia/New Zealand Food Standards Code, std 1.1.2 – 6, set out at [37] above.
20 Food Act 2014, s 8.
21 Thompson v Police (1986) 2 CRNZ 274 (HC).
22 Leslie Brown (ed) The New Shorter Oxford English Dictionary on Historical Principles (4th ed, Clarendon Press, Oxford, 1993).
[60] For instance direct warnings are placed on labels of products containing specified amounts of caffeine. The product must carry a warning that certain classes of person such as pregnant women should not consume the product. This labelling provides safety and suitability information for a consumer.
[61] The labelling, the marketing and associations of the product will also be relevant to establishing and the consumer’s perceptions and so the product’s purpose.
[62] Berocca Forward’s labelling reflects the labelling and style of the current and other well-established Berocca products. Bayer itself says its intention was to market Berocca Forward as a ready to drink product associated with the well-established Berocca range. It did so initially with explicit labelling claims. While the claims are no longer explicit, there is no attempt to distance this product from the other Berocca products insofar as its intended use and benefits are concerned. The labelling has been designed to reinforce that association.
[63] In this case the Berocca family of products are marketed to convey the message to a consumer that they will enhance mental performance as well as physical energy. This was originally explicit in the marketing of Berocca Forward until those claims were removed by Bayer in about February 2017. However, the present labelling keeps the product identified with the other Berocca products. It is apparent from looking at the Berocca Forward labelling that a consumer would associate its purpose with that of the other Berocca products.
[64] The Berocca Forward labelling also carries the FCB usage and safety warnings on the labelling as required for FCBs. These include the warnings about caffeine for children and pregnant women or those sensitive to caffeine as well as a maximum dosage level (two cans daily).
[65] I am of the view that a consumer would be given the impression that the Berocca Forward drink has the same purpose as its Berocca product stablemates – generally promoting mental and/or physical energy. This is supported by the labelling and the fact it contains caffeine which is generally regarded as a stimulant. It is also reinforced by the fact it was initially marketed as promoting those purposes.
Expert evidence
[66] Bayer adduced expert evidence as to the physiological effects of Berocca Forward on the question of whether it in fact contributed to mental energy.
[67] MPI filed an affidavit indicating that Bayer’s expert’s evidence was not accepted. Ms McKechnie says that MPI’s evidence was a late contradiction of Bayer’s expert evidence. She said that MPI had received the expert report by Professor Scholey in 2017 but it appeared that the report had only recently been made available to the MPI team responsible for dealing with this matter. Ms McKechnie concluded that those matters should go to weight.
[68] Ms McKechnie says the evidence of Professor Scholey qualified as expert evidence but MPI’s evidence was provided by Ms Lau, a senior advisor from MPI, who had not qualified herself as an expert and who did not have the expertise or experience of Professor Scholey.
[69] Professor Scholey in his conclusion said that caffeine in specified doses has “well documented pharmacological activity” and that “the most consistent effects on physiological processes underlying cognition arises at doses of caffeine from 40- 50 mgs”. At 80 mg (or one serving of Berocca Forward) the physiological and behavioural effects included “faster processing speed and increased alertness”. Ms Lau for MPI says that the data suggests the positive associations such as alertness and concentration are observed in doses of caffeine of 20 to 200 mgs.
[70] It appears common ground that the amount of caffeine contained in Berocca Forward is likely to be pharmacologically active with an effect on cognition. It is likely to have the effect of improving performance in vigilance and cognitive performance.23 The experts do not differ on that point.
23 The labelling on Berocca Forward reads that it contains an average quantity of 80 mg per serving of 250 ml (can contents). The label suggests a maximum of two cans daily.
Enhancing mental performance
[71] To establish that an FCB has the purpose of enhancing mental performance introduces a subjective element as Clifford J recognised.24 The purpose includes what was intended to be conveyed to the consumer. There is no doubt that a claim of mental sharpness was intended to be conveyed to a consumer buying Berocca Forward. That claim was directly conveyed on the labelling initially and is now indirectly conveyed by the labelling association with the Berocca range. Bayer had expert support for its initial labelling claims of “mental sharpness”. The product composition has not changed since then. The intention conveyed to a consumer will be that the product will improve “mental sharpness”. This is a purpose within the scope of enhancing mental performance.
[72] It is the consumer from whose point of view the purpose must be considered. A common-sense approach is called for in the circumstances. Common sense indicates that Berocca Forward would be seen by a consumer as a product which had the purpose of enhancing mental performance. That it is likely to have that effect is supported by the expert evidence.
Non-complying additives
[73] Therefore, Berocca Forward meets the definition of FCB in that it contains caffeine and it has the purpose of enhancing mental performance. Once the requirements of the FCB definition are met the product is classified as an FCB. Compliance with the FCB standard is the second step.
[74] An FCB must contain no less than 145 mg/l and no more than 320 mg/l of caffeine in total from any source25 and also “may” contain a listed substance.
[75] Berocca Forward contains the permitted levels of caffeine.26 The product may contain permitted levels of approved vitamins and mineral. 27
24 Sanson v Attorney-General [2012] NZHC 2627 at [40].
25 The can labelling states it contains 32 mg\100 ml and one can contains 250 ml with two cans the maximum recommended daily quantity.
26 The levels of caffeine in the product were not in dispute.
27 At [38].
[76] The restrictions on additives came about as the recommendations made in an official inquiry report on FCB’s produced in 2001.28 It suggested that a scientific risk assessment be undertaken in relation to the substances which could safely be added to an FCB.
[77] Vitamin C, magnesium and zinc are not permitted listed substances in the standard but have been added to Berocca Forward.
[78] Bayer says it is not an answer for MPI to suggest that Bayer either remove the caffeine or the non-complying vitamins and minerals to make its products compliant either with the “supplemented food” classification (by removing caffeine) or the “formulated caffeine beverage” classification (by removing the non-complying vitamins and minerals). Bayer says that would be a big task and in any event, it would make Berocca Forward different from the rest of the Berocca family of products. Bayer says to take away the vitamins and minerals which are also additives in the two tablets products would differentiate the product from the others in the range of Berocca products.
[79] The fact that Berocca Forward contains non-compliant additives means Berocca Forward is a non-complying FCB. Adding non-listed additives does not move the product outside the FCB definition. In order to be sold or distributed within the current legal requirements the product must comply with the FCB standard.
[80] Berocca Performance is meeting various other requirements of the standard. For instance, the declarations on the labelling say that it is only for people 16 years of age and over and is not recommended for “children, pregnant or lactating women, or individuals sensitive to caffeine”. This complies with the labelling requirements under the FCB standard 2.6.4 referred to at [39].
28 Australia New Zealand Food Authority | Te Mana Kounga Kai mō Ahitereiria me Aotearoa Inquiry Report: Application A394: Formulated Caffeinated Beverages (Australia New Zealand Food Authority | Te Mana Kounga Kai mō Ahitereiria me Aotearoa, Inquiry Report 02/02, 8 August 2001).
An energy drink
[81] MPI submitted that Berocca Forward was an energy drink. It said it was placed in the vicinity of other energy drinks in supermarkets. It says that energy drinks were exactly what the “formulated caffeinated beverage” standard was initially intended to capture.
[82] The 2001 report on the inquiry into formulated caffeine beverages led to the development of the FCB standard. The report noted that at that stage there was no commonly accepted or uniform definition for “energy” drinks in Australian or New Zealand food regulation or even internationally. The description “formulated caffeinated beverages”, MPI said, was developed as a proxy for energy drinks in the absence of a suitable definition for energy drinks.
[83] That report emphasised that all additives which were added to “formulated caffeinated beverages” should be subject to an assessment. It recommended a conservative approach to permitted additives by the adoption of a list of permitted quantities of approved added substances. That recommendation resulted in the schedule of “listed substances” adopted in the New Zealand standards which contains an exclusive list of permitted additives.
[84] The report noted the need to manage health claims made on FCB products and the importance of labelling. This was to manage perceptions that FCBs were vitamin supplements. The present FCB standard requires labelling warnings about maximum dosages and categories of people who should not drink an FCB.
[85] Ms McKechnie for Bayer said that FCBs are not a proxy for energy drinks. She pointed to a number of examples of drinks which claimed to be energy drinks on their labels but were not caffeine drinks. She also noted that Berocca Forward was not always stored with energy drinks in supermarket fridges and shelves.
[86] I do not consider it necessary to determine whether or not Berocca Forward is an energy drink. A workable definition of “energy drink” was not able to be achieved by the experts who wrote the inquiry report in 2001, although it seems that the report did particularly focus on caffeine-added beverages. As Clifford J in Sanson v
Attorney-General29 noted the FCB standard was as he understood it “developed to allow for energy drinks containing higher quantities of caffeine than are permitted to be added as an additive.” He went on to say it was clear that “energy drinks” were “regulated under the FCB standard” and that the definition of FCB introduced something of a “subjective element, namely that of requiring a determination as to whether the purpose of the inclusion of caffeine is enhancing [of] mental performance.”
[87] However, for the purposes of this case whether Berocca Forward is an energy drink is immaterial.
Is Berocca Forward an FCB?
[88] As will be apparent I am of the view Berocca Forward is an FCB which incorporates non-permitted additives. It is a non-complying FCB.
[89] My conclusion is based on the fact that the product meets the definition of FCB in the relevant standard. Berocca Forward contains caffeine and I have found it has the purpose of enhancing mental performance within the meaning of the definition of FCB. This interpretation is consistent with the purpose provisions of the Act, as they relate to safety and suitability of food and consumer protection as well as maintaining confidence in New Zealand’s food safety regime.
[90] Bayer pointed out that one of the purpose provisions of the Act is to “provide certainty for food businesses in relation to how the requirements of this Act will affect their activities”. In my view the meaning of the standards and their application is clear so there is no uncertainty. In any event that provision would not override the text of the standard in this case. Even if that were not the case the purpose provisions need to be read as a whole and in the context of the food safety and suitability provisions of the Act.
[91] The 2001 report that led to the promulgation of the FCB definition and standard noted there were risks associated with caffeine-enhanced beverages. They are
29 Sanson v Attorney-General, above n 24, at [40].
managed by information on the labelling such as recommended dosage levels and warnings to various categories of person that they should not drink the FCB as well as restricting additives.
[92] The incorporation of non-complying additives in Berocca Forward has made it non-compliant with the FCB standard.
Other matters – change to standards
[93] Bayer submitted that the pragmatic solution for the problem with the non- complying additives in Berocca Forward would be a change to the standard. It said despite support by MPI this was not a quick fix because FSANZ was “glacially” slow to make changes. In those circumstances Bayer said it should not be expected to wait for the standards to change despite MPI’s support. It gave examples of other areas in which FSANZ had been slow to respond.
[94] A declaration requires the interpretation of the existing law and standards. The responsiveness of the system to requests for changes to the standards is a separate question and not for this Court. That inquiry requires expert input as well as consultation with the sector and is a matter for the relevant authority.
Conclusion
[95] I have concluded that Berocca Forward is a “formulated caffeine beverage” and I make that declaration accordingly. I do not consider any further declarations are appropriate in the circumstances.
[96] MPI sought a further declaration that “all food must comply with relevant parts of the Food Code as it applies to that particular food. A company cannot unilaterally determine which standards apply to its food”. The focus in this case was on a particular product. The declaration will therefore be limited to the particular circumstances and will only bind the parties to this application.
[97] If anything further is required to deal with the issue before me counsel may address the issue by memorandum filed within the timeframe set out below for the costs memoranda.
Costs
[98] Counsel indicated that costs should be reserved. There appears no reason why costs should not be awarded to the successful party. The appropriate classification appears to be 2B. However if counsel are unable to reach agreement concerning costs, any application for costs should be made by memorandum with supporting submissions within 10 days of the date of this judgment. Any response within a further 10 days and any reply within a further three days of that.30
Commercially sensitive material
[99] The evidence in this case included some commercially sensitive and confidential information. The parties sought the following orders by consent:
Without the leave of the Court:
(a)All commercially sensitive and confidential information referred to in the affidavit of Natalie Acevski and the parts of the plaintiff’s synopsis of submissions which information is marked in grey will be kept confidential on the Court file and not made available for inspection;
(b)The Court file is to be marked accordingly. The plaintiff is to be notified of any request to access the file pursuant to the Senior Courts (Access to Court Documents) Rules 2017; and
(c)No individual or organisation may publish or disclose the above commercially sensitive and confidential information.
30 Counsels’ attention is drawn to the Rules: High Court (COVID-19 Preparedness) Amendment Rules 2020: align="left">[100]Such orders are appropriate and are made accordingly.
Grice J
Solicitors:
Simpson Grierson, Wellington Crown Law Office, Wellington
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