When nutritional claims turn into false advertising…

Imported milk with addition of phytosterol was sold in Chengdu as ordinary food. The packaging claims “This phytosterol milk contains α-lactoalbumin, which helps to regulate cerebrum and nerves and to improve the sleep”. The words used in the original Chinese claim “improve the sleep” (“改善睡眠”) match exactly the wording of one of the 27 allowed health-food claim, which is however allowed only for CFDA-approved health-food (not for ordinary food). On the other hand, the other part of the claim “to regulate cerebrum” (in Chinese: 调节大脑神经) is not even amongst the 27 allowed health claims.

A consumer purchased the product and reported this claim to the local AIC; AIC issued a punishment decision of 5000 RMB to the retailer as it considered that the claim breached article 13 of the Provisional Regulation on Announcement of Food Advertisement whereby “ordinary food products … advertisements cannot advertise health protective effects, and it is prohibited to expressly or impliedly indicate the health protective effects of the food by advertising the effects of certain ingredients”.

The consumer however was expecting to cash something out of this case (refunded of the price + some punitive damages). He therefore started a civil litigation claiming to have been deceived by such false advertising and therefore to deserve the protection granted by article 55 of the Consumer Protection Law.

Interestingly, both the first instance and the second instance courts did not support his claim. In fact, both courts distinguished very clearly the scope of the abovementioned Provisional Regulation on Announcement of Food Advertisement, whereby the α-lactoalbumin can well be considered not allowed and “improper” (the Chinese word used by the second instance court is “宣传不当”); but this is different from qualifying this behavior as “false advertising” (“虚假宣传”).

The court clearly stated that – in order to support the consumer’s claim –  the consumer should have proven (i) either the product did not contain any α-lactoalbumin, or (ii) that α-lactoalbumin does not have any cerebrum-regulating or sleep-improving functions. The consumer however did not provide any such evidence.

On the contrary – says the court – the defendant had provided (as evidence supporting the α-lactoalbumin claims) a web-page of the PRC Ministry of Agriculture that support such claims.

Some comments
This decision is interesting under several perspectives.

1. First of all, it limits the consequence of non-allowed claims when it can be proven that these claims are scientifically based (or when the contrary cannot be proven). As the number of allowed nutritional claims in China is very limited – and no variations are in theory allowed – companies often need to evaluate whether sticking to the law, taking zero risks and therefore waiving marketing opportunities, or whether pushing on the claims and taking risks. Companies taking the second options are therefore strongly recommended to prepare defensive dossier with scientific and official data to support the claim.
2. Talking about evidence, we see here that the defendant provided as evidence a web-page by the PRC Ministry of Agriculture. A Chinese AND official piece of evidence. This is the kind of evidence to be used in China: scientific, official and Chinese. Foreign evidence is more difficult to be accepted, even more when it has no official status or when it is directly related to the interest of food producers (think about claims by specific industry associations/boards). Companies cannot simply translate into Chinese claims already vetted overseas; China asks for specific Chinese vet.
3. Last but not least, in this case we see a content claim for α-lactoalbumin, despite this protein is not even mentioned in relevant regulations for nutritional claims. The consumer apparently did not attack specifically this point – and we remain curious to know what the court would have decided in this regard. Maybe the approach would have been consistent with the abovementioned principle, i.e. sanctioning the non-appropriate content claim, while not granting any damage request to the consumer under the consumer protection law (no fraud has been committed, and no false statement provided if the α-lactoalbumin is actually present in the product).

However, in this case, a consumer could also claim that the non-allowed content claim breaches GB 28050, which has the status of food-safety regulation. Does this breach article 148 of the Food Safety Law then (which grants 1000% punitive damages)? Or could the company invoke the exemption clause, i.e. the non-allowed content claim is just a defect in the labels or instructions of the food which neither impairs food safety nor misleads consumers?

Good idea for a next post…