Introductory Thoughts: why does regulation matter ?
Finding a suited regulation
- The first problem related to regulation of novel food is to adopt a regulation which is enough strict to protect the consumers but also flexible in order to encourage innovation in this field. In fact regulation is often seen as an obstacle to innovation because innovation requires very costly investments in Research and Development. Moreover, acquiring a marketing authorization has a cost because the burden of proof is entirely borne by the company.
- For example, European Union’s Novel Food Regulation has set up a very long process of marketing authorization even for « traditional food products » that are already consumed in different areas of the world (except in the EU). The table below shows that the average delay taken from acceptance of an application to market authorization by the EU Commission is 39 months.
- Moreover, even if the cost of the process is difficult to assess because companies usually do not disclose this cost, there is some evidence that this cost is relatively high. For example, according to the Independent, the company Phytotrade spent more than £150,000 on the application process to authorize the sale of its product, a baobab fruit during a 2-years application.The need to harmonize regulations in a context of free-trade
- In order to ensure a fair economic competition, harmonizing regulation across the world on novel food is of paramount importance. In fact, novel food seems to be a ground of “commercial war” because countries use some regulatory barriers to perform a sort of “murky protectionism”. The example of the complaint lodged by Argentina and the US against EU’s moratorium on GMOs at the WTO shows that globalization pushes to harmonize the regulation on this field because the economic issues are important. Other controversies like the prohibition of hormone-feed beef in the EU had led to proceedings at the WTO.
USA: US/EU BEEF DISPUTE ENTERS NEW PHASE
- The OECD launched a program to think on the common grounds of regulation in the field of Biotechnology products, particularly from new crop varieties to ensure the protection of human and animal health. The outputs of this program are the « Consensus Documents » that provide information on critical parameters of food/feed safety and nutrition. These documents gather, for each crop under consideration, common scientific elements on key nutrients, anti-nutrients, toxicants and allergens.
 “Semences agricoles, monopole privé sur un bien public”, avril 2014, Déclaration de BerneFinally, a stringent regulation is not always at the advantage of the customer: the complexity of the legal procedures and the need for lobbying generate a high-concentrated market and situations of oligopolies. The example of seed market is striking: in 1985, the 5 biggest companies represented 12, 5 % of the world market but in 2014, the five biggest companies controlled 60,7% of the world market (20,7% for the market leader, Monsanto).
USA: US/EU BEEF DISPUTE ENTERS NEW PHASE at the WTO
General aspects of novel food regulation in the US and the EU
The term of novel food is quite recent. It appeared in the 90s and refer to new type of food that was never (or little consumed) in man’s history (for instance: synthetic zeaxanthin or insects) or food that is produced through new methods (beef steak made from stem cells for example).
The Regulation in the EU
In the European Union, « novel food » is regulated by the Regulation (EC) No 258/97 concerning novel foods and novel food ingredients modified by Regulation (EU) 2015/2283 of the European Parliament and of the Council of 25 November 2015.
According to the European Union’s Novel Food Regulation, the novel food should obey to three criteria: (a) it must not present a danger for the consumer, (b) it must not mislead the consumer (e.g, the product should be clearly labelled), (c) it must not differ from foods or food ingredients which they are intended to replace to such an extent that their normal consumption would be nutritionally disadvantageous for the consumer.
In order to ensure the protection of the customer on the basis of the above three criteria, any company which wants to launch a novel food product on the European Market must comply with a strict application process.
The first step for the applicant is to submit a request to the Member State in which the product is to be placed on the market for the first time and a copy of the request to the Commission. In a delay of 3 months, the national expert committee for food safety (for instance in France, the Agence de Sécurité Sanitaire de l’Alimentation, de l’Environnement et du Travail – ANSES) writes a comprehensive report and transmits it to the other Member States.
Thus, there is a 60- days consultation phase with the other Member States. If there is no objection following the consultation phase, the novel food product can be commercialized. If a scientific objection is raised, a complementary scientific study is lead by the EFSA (European Food Safety Authority) in a 3 months delay, which is transmitted to the CP CASA (a committee, which assists the European Commission). This Committees stands for 2 to 4 months and if its opinion is positive, a regulation is published in the Official Journal of the European Union allowing the commercialization of the product. If a non-scientific objection is raised during the Member States’ consultation phase, the file is directly transferred to the CP CASA which decides whether the product should be authorized or not.
 Article 3 of the latest version of REGULATION (EC) No 258/97 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL
The regulation in the US
Regulation in the US concerning food, is governed by the Federal Food Drug and Cosmetic Act passed in 1938, amended by the Food Additives Amendment of 1958. The concept of novel food does not exist in itself in North American law. Any substance deliberately added to food (“Food additive”) is subject to the prior approval of the Food and Drug Administration (USFDA) unless the substance is “GRAS”, that is to say, “generally recognized as safe”, through scientific procedures.
International comparisons of the different national regulation on novel food
In the EU, insects are legally recognized as “novel food” by Regulation 2015/2283 of the European Parliament and of the Council of 25 November 2015. As their legal status is the one of the novel food, they should obtain an authorization through the process described above. However, on the basis of the prior European Regulation (Regulation (EC) No 258/97), some countries as the Netherlands and Belgium have authorized the commercialization of some insects. For instance, Belgium has authorized the commercialization of ten species of insects as human food. In order to solve this legal issue, a period of transition had been set up by the European authorities: for insects authorized for human consumption before Regulation 2015/2283 was set, the companies have until the 1st January 2018 to obtain an authorization to commercialize their insects at the European level.
It should also be noted that insects fall into the regulation of animal proteins in the EU. In fact, it is forbidden to feed farmed animals with animal proteins in the EU since the “mad cow crisis” in 2001. However, the legislation in the EU has been relaxed in 2013, with Commission Regulation No 56/2013 of 16 January 2013, which allows to feed fishes with animal proteins.
There may be need to relax the EU legislation on edible insects because it is a promising market. In fact, the potential market of the animal flours made from insects is evaluated to 45 billion of euros in the EU. Moreover, as the EU has a more stringent regulation than other countries, it hampers the development of new companies and technologies. As a result, the EU could fall behind other countries in terms of technologies, as it was the case for GMOs.
In the US, many insects are allowed to be sold as human food. For example, the company “Hotflix” sells candies that are made from insects: scorpions, crickets, and mealworms and the “Cricket Ranch” farms cricket at an industrial scale.
In other regions of the world, like in Africa or Asia, there is no specific legal issue concerning insects’ consumption as food. As insects are part of the traditional food in these countries, insects are not considered as “novel food”.
In the EU, the Regulation in force about GMOs is quite stringent. In fact, four different GMOs are allowed to be grown on the European soil (the corn MON810, the corn Bt176, the corn T25 and the “Amflora” potatoe) but the importation of more than 69 GMOs is authorized. According to Regulation n° 1829/2003, in order to obtain a premarket authorization, a company which wants to commercialize GMOs on the European soil must transmit a file to the EFSA which whether the GMO can be sold or not on the European Market. Besides, and unlike the US, GMOs should be clearly labelled.
However, the moratorium on GMOs in the European Union definitely spilled a lot of ink. On the 3th of October, seventeen Member States of the E.U decided to adopt a moratorium on the growth of corn MON 810.
The European Commission had validated this moratorium on November 2015 and a new approach of the Regulation of GMOs had been adopted with the Directive (E.U) 2015/412 of the European Parliament and the Council of March 11th, 2015. Henceforth, each state of the European Union is free to forbid the growth of GMOs on its soil, even if the Member State refuses to negotiate with the company, which wants to commercialize GMOs. Before this modification of the regulation, the Member State was allowed to forbid GMOs but at the condition that it had negotiated with the company in question.
The new Approach of the EU on GMOs
Is the European position on GMOs a kind of protectionnism ?
In the US, GMOs are widely accepted and there are few legal restrictions on GMOs. In fact, a study of the Grocery Manufacturer Association shows that 70 to 80% of the American contains GMOs. However, even if some sates require mandatory labelling of GMOs (Vermont and Connecticut for example), it is not an obligation at the federal level.
The differences between US and E.U regulation can be explained by the different approach chosen by the Authority in charge of regulation. For the American National Research Council, “the product of genetic modification and selection constitutes the primary basis for decisions and not the process by which the product was obtained“. This positivist approach means if the product is safe for human consumption, it should be authorized. As a consequence, the American Regulatory Authorities – the FDA and the USDA – actively worked to promote GMO in the 1990s by simplifying the procedures for importing, and releasing GMOs into the environment.
The European approach has more concern about how the product is made and the consequences of this innovation. In Europe, people against GMOs often invoke three types of arguments. The first argument is that we do not have enough hindsight on the use of GMOs in human alimentation. The second argument relies on the precautionary principle: if countries legalize GMOs, as the pollination process could melt GMOs with non-GMOs, the distinction between the two will be impossible to keep. Finally, public opinions often consider that GMOs generate a great dependency of farmers on the big seed companies, which are in a situation of oligopoly and that this oligopoly could harm biodiversity by reducing the number of seeds available.
But the difference of regulation between the US and the EU often generates conflict at the WTO. For the US, the prohibition of GMOs by the E.U is a restriction to free trade because it constitutes a measure having equivalent effect to quantitative restrictions. In fact, this ban had a protectionist effect in the E.U. According to an American study, the part of American corn on the European market felt from 86% in 1995 to 12% in 1999, “largely because while the US has approved eleven varieties of this crop, the EU has approved only four”. For the American corn sector, it represents a loss of 200 million per year.
Subsequently, the Bush administration, lodged a complaint with the WTO with other great producers of GMOs (Canada, Argentina, Brazil, Chile…). The WTO judged on 10th of May 2006, that European restrictions on GMOs were illegal. This decision authorized the US to take commercial sanctions against the EU in retaliation.
 National Research Council, Field Testing Genetically Modified Organisms: Framework for Decisions (Washington, DC: National Academy Press, 1989), cited in Error! Bookmark not defined.
 Regulation of GMOs in Europe and the United States: A Case-Study of Contemporary European Regulatory Politics.” Apr 2001. Council on Foreign Relations. Dec 2016.