Impact Of Legislation On Beverage Industry In Australia

Overview of Beverage Industry and Legislation in Australia

A beverage is a liquid apart from hater that is prepared for the consumption by the customers. The legislations that govern the production and distribution of the beverages in the country and falls under the food safety regulations. This is outlined in the food Standard Australia New Zealand (FSZNZ). These polices apply to every business that is involved in the processing, manufacturing and the distribution of foods and beverages. These legislations affect differently the different companies that process different forms of beverages. Through out this paper we will be handling the different legislations that have affected the beverages in the country. Tis implies that the report will be inclusive of all the legislations, give out any changes within the legislation and its impact to the processing, manufacturing and the distribution of the beverages.

Over the years the countries legislations have kept changing ad have managed to impact different sectors in the country. It is important to address some of the recent legislations that have affected the beverages. In the year 207 the food standard Australia New Zealand made the legislation that called for the submission for application A1127 that affected the processing aid in Wines. This falls under the beverages sector that is discussed in the report. The legislation the 26^th of April 2017 FSANZ issued the call the call for the submission of the Application form A1127 by the wine makers federation of Australia which seek the permission for the use of silver chloride ammonium bisulphate, chitin Glucan and PVI/PVP as the respective processing aids for wine. The main importance of the processing aids listed above according to the CEO of FSANZ expressed that there use helps in various processes including as fining agent and also sued to reduce odor that occur during the storage of wine (Baker, Jones, and Thow, 2018). The change in the legislation was carried out after the research conducted by FSANZ on the multiple gents and realized that their use had no health implication to the consumers. The legislation has had a great impact to the winemakers processing and production since the implementation of this has managed to boost the quality of wine that has been distributed. This shows a clear change in a legislation and its impact to the beverage company.

The legislative body concerned the nature of beverages that reach the public also had other legislations in place that affected different sections of the topic of concern. FSANZ rejected the potential Application PA1145 which permits the use of any substance as an intense sweetener. The policy disapproves of the use of various sweeteners in different beverages. This policy also impacted the food sector although currently that isn’t the point of concern. The implementation of this sector affected different beverages that used these sweeteners that had been disapproved by the law. This shows the impact in the production of some beverages. These beverages had to look for alternative sweeteners that were approved by the legislation. The decision of imposing the laws was based on multiple food research that showed the potential harm of the use of such sweeteners (Basu, and Madsen, 2017). The main reason for the passing of the policy is due to the failure of the responsible companies to provide a non-permitted enzyme, a failure to provide primary toxicology study, this shows that the legislation was based on the facts that less adequate research on the levels of toxicity of the additives was not available hence the permit denial, also the failure to provide English translations of some major documents for the sweeteners (Brand-Miller, and Barclay, 2017).

Impact of Processing Aid Legislation on Wine Production

There are different bodies that affect the production, manufacturing and distribution of beverages in the country. For instance, the Australian Competition and Consumer Commission (ACCC). This is the federal governments regulatory agency that manages to maintain the fair trade and competition and consumer protection in the Australian marketplace. The distribution of beverages having a significant impact to the market, the agency is responsible for the control of how this product reaches the consumers and in return ends up affecting the whole industry. The call for stronger competition and consumer las and penalties greatly affected the beverage industry. This being among one of the leading industries in the country ACCC chairman Rod Sim flagged the need for the Australian Competition and Consumer Act that it needed to act in a much stronger and tougher penalties to help in the control of competition in industries which command the market. This means that the changes involved higher fines to deter the anti-competitive behaviours of some of the companies. This was due to the greed of high production so s to gain competitive advantage in the industry (Lal, et al., 2017). In the process this led to the low-quality production of the consumer products such as the beverages or the introduction of harmful content so as to help the company products stand out due to the competitive nature of the market. This ends up with unhealth competition since the consumer interests are affected. The new proposals and changes regarding the strictness in fighting the unproductive competition results to the fall in the production rate of the beverages so as to meet the required quality as well as educe the distribution quantity o the product in the country. This has a significant impact of the beverage production in the country both directly and indirectly.

There have been policies that has also impacted the beverages such as the red bull breach for suggesting energy drinks combat driver fatigue. The misleading advertisement of the different beverages specifically the Red bull advert led to the intervention of the Advertising Standards Board (ASB). The changes give a closer look at the presentation of the beverage and clearly shows the legal requirement of the beverage (Crino, et al., 2017). The Red bull advert that was in breach of the advertises code of ethic led to the increased monitoring of the content produced for consumption by the customers. This was such a significant change within the industry. The legislation plays a huge role in sensitizing the consumers on the real impacts of the beverages and in return affecting the market share of the beverage consumers (Rankin, 2017). It is evident that the case of the advert on the use of Red bull for the driver had given the consumer a different perspective towards the drink but the minute the legislation is on the case the legitimacy of the beverage’s success become corrupted hence affecting the attitude of the consumers to the people. It is important to address the fact that the legislation had a significant impact on the distribution logistics of the beverages. For instance, the red bull advert quoted below:

Impact of Sweetener Legislation on Beverage Production

“The advertisement depicts a man in a car.  The man’s GPS system yawns and explains that it was unable to stop for a Red Bull so is tired after seven hours of driving.  The ASB held that there was a strong suggestion in the advertisement that the man had been driving for seven hours and that the consumption of an energy drink was sufficient to overcome driver fatigue.  This was determined to be an unsafe message that was contrary to prevailing community standards.”

The advert was extremely controversial and due to the legal changes, this was pulled don ad the company was not allowed to run it again. This cleared a path on what to advertise for the beverage industry and what not to understand. The legislation needed or called for the depiction of the truth to the consumers while advertising these products. An over stated advertisement manages to get the beverage consumption high in the country but currently the changes and the monitoring of the market by the new consumer laws have significantly affected the companies outreach to the consumers (Labontéet al.,2017.). And as seen this has changes some of the consumers perspective towards some of these beverages.

New reforms in the importation of food and beverages into the country has also significantly affected the beverage industry. The reforms by the Australian department of agriculture and water resources have requested for the review of all the imports in the country (Lei, Rangan, Flood, and Louie, 2016). The legislation significantly impacts the market since the standards of the country’s beverages and the foods has been seen to be different and different studies shows that these reforms may affect the industry (Griffiths, 2016). These changes are to impose tougher requirements on the imports so as to ensure the safety of the consumers within the country. This has been as a result of speculations that most of the imports have not been verified locally or certified locally for the consumption of the consumers.

On the other hand, the legislation also governs how beverage products are to be advertised in the market. This means, the non-alcoholic beverages are not to be labelled or presented as alcoholic beverages. This affects how these products are displayed to the customers. The legislation helps the consumers differentiate the alcoholic beverages and the non-alcoholic beverages. The non-alcoholic beverages are governed by the policy and in case of breach of the legislation the legal stand on the matter is taken. The legislation also determines what is categorized as a non-alcoholic beverage (Hoare, et al., 2017.). For instance, according too the legislation a non-alcoholic beverage means a packaged water or a water-based beverage or a water-based beverage that has other foods aside from alcohol added to it. It also included the electrolyte drink; and does not include a brewed soft drink. This points out clearly the definition of a nonalcoholic drink. This legislation governs the market and protects what is provided to the consumers. Within the industry, for the introduction of any new substance in the category requires the approval of the Food Standard Australian New Zealand.

Role of Australian Competition and Consumer Commission (ACCC)

The legislation also helps in the definition of other forms of beverages such as the formulated beverage which means a non-carbonated ready to drink, and flavored beverage that is water based as well as contains minerals or vitamins or both of them. The legislation is also responsible for establishing the different content amount of some things such as the fruit content in it. For instance, a formulated beverage is expected to have more than 240nL/L of fruit from a few sources provided by the legislation: fruit puree, fruit juice, concentrated fruit puree, concentrated fruit juice, comminuted fruit and orange-peel extract (Sainsbury, Hendy, Magnusson, and Colagiuri, 2018). Formulated beverage is also to contain no more than 75g/L of sugar and should not contain carbon dioxide as well as caffeine (Hankey, 2015). This should not also be mixed with other beverages. This shows that the legislation completely draws what is to be used for the production of so these beverages. It is evident that the government has set legislations and agencies that ensure all the legislations are followed to the letter and incase of any deviation from this implies the breach of law.

Conclusion

Conclusively, the beverage industry in the country is under a tight grip by the government. The industry is controlled by the different legislations set in place and the changes within the legislations have significant impact on the beverage industry. Most of the covered legislations have helped explain the beverage market and why it currently is.

References

Baker, P., Jones, A. and Thow, A.M., 2018. Accelerating the Worldwide Adoption of Sugar-Sweetened Beverage Taxes: Strengthening Commitment and Capacity: Comment on” The Untapped Power of Soda Taxes: Incentivizing Consumers, Generating Revenue, and Altering Corporate Behavior”. International journal of health policy and management, 7(5), p.474.

Basu, S. and Madsen, K., 2017. Effectiveness and equity of sugar-sweetened beverage taxation. PLoS medicine, 14(6), p.e1002327.

Brand-Miller, J.C. and Barclay, A.W., 2017. Declining consumption of added sugars and sugar-sweetened beverages in Australia: a challenge for obesity prevention, 2. The American Journal of Clinical Nutrition, 105(4), pp.854-863.

Crino, M., Herrera, A.M.M., Ananthapavan, J., Wu, J.H., Neal, B., Lee, Y.Y., Zheng, M., Lal, A. and Sacks, G., 2017. Modelled cost-effectiveness of a package size cap and a kilojoule reduction intervention to reduce energy intake from sugar-sweetened beverages in Australia. Nutrients, 9(9), p.983.

Griffiths, J.J., 2016. Recognition of Foreign Administrative Acts in Australia. In Recognition of Foreign Administrative Acts(pp. 51-89). Springer, Cham.

Hankey, C., 2015. Food and catering modifications for public health: chronic disease and obesity prevention. Medicine, 43(2), pp.135-138.

Hoare, E., Varsamis, P., Owen, N., Dunstan, D.W., Jennings, G.L. and Kingwell, B.A., 2017. Sugar-and intense-sweetened drinks in Australia: a systematic review on cardiometabolic risk. Nutrients, 9(10), p.1075.

Labonté, M.È., Poon, T., Mulligan, C., Bernstein, J.T., Franco-Arellano, B. and L’Abbé, M.R., 2017. Comparison of global nutrient profiling systems for restricting the commercial marketing of foods and beverages of low nutritional quality to children in Canada. The American journal of clinical nutrition, 106(6), pp.1471-1481.

Lal, A., Mantilla-Herrera, A.M., Veerman, L., Backholer, K., Sacks, G., Moodie, M., Siahpush, M., Carter, R. and Peeters, A., 2017. Modelled health benefits of a sugar-sweetened beverage tax across different socioeconomic groups in Australia: A cost-effectiveness and equity analysis. PLoS medicine, 14(6), p.e1002326.

Lei, L., Rangan, A., Flood, V.M. and Louie, J.C.Y., 2016. Dietary intake and food sources of added sugar in the Australian population. British Journal of Nutrition, 115(5), pp.868-877.

Rankin, J.G., 2017. Australia, a consumptive society. Drug and alcohol review, 36(2), pp.270-277.

Sainsbury, E., Hendy, C., Magnusson, R. and Colagiuri, S., 2018. Public support for government regulatory interventions for overweight and obesity in Australia. BMC public health, 18(1), p.513.