Liability schemes in outsourcing and tech contracts: A cross-border survey
A key question customers and suppliers want answered about their outsourcing and technology contracts is whether their liability position is market-standard.
The Safe Food for Canadians Regulation (SFCR) came into force on January 15, 2019, and introduced three fundamental new requirements upon those in the food industry:
Those in the manufactured food sector were granted an 18-month transition period to comply with these requirements (i.e., to July 15, 2020).5 At a high level, the manufactured food sector includes confectionary, snack foods, beverages (including alcoholic beverages), oils, dried herbs and spices, nuts and seeds, coffee and tea, baked goods, cereals, and pastas.
Effective April 7, the CFIA has advised it will not prioritize compliance with the SFCR by the manufacturing food industry. While no new deadline has been established, the CFIA advises it will “provide adequate lead time” if its position changes on this issue.
The result of this policy is significant in preventing delays in the food supply chain in two important ways:
Despite easing the date of compliance, those in the manufactured food sector must still ensure the safety of their food products at all times. The CFIA will continue to take steps to protect consumers, including recalling, seizing, or detaining food products.
Effective April 6, the CFIA has temporarily suspended certain labelling and sizing requirements for foodservice products that have no impact on food safety. Foodservice products include those food products intended for use in hotels, restaurants, and institutions.
As a general rule, foodservice products are not subject to the same labelling requirements as prepackaged food sold to consumers. For example, prepackaged foods made, packaged or labelled for use in commercial or industrial enterprises or institutions, are exempt from various SFCR labelling requirements.6 Further, most foods sold in restaurants and food service establishments are not considered prepackaged, and are not required to have a nutrition facts table.7
Due to the pandemic, foodservice products have been “stuck,” and in danger of going to waste during a time when those products could be put to very good use. Demand for foodservice products has been significantly curtailed as restaurants restrict their services to pick-up or delivery only (or close altogether). At the same time, it has been difficult to repurpose these products for sale to retailers such as grocery stores, or potentially restaurant made “meals-to-go,” due to non-compliance with Canada’s labelling requirements.
The suspensions implemented by the CFIA have removed many of these roadblocks, enabling the retail sale of foodservice products if the following core labelling requirements are met:
o a common name;
o a list of ingredients and an allergen declaration, if applicable;
o a name and contact information for the person responsible for the food;
o a net quantity (in metric or imperial units);
o a lot code identifier (such as, date of production, best-before date, lot number);
o storage instructions and best-before date, if applicable;
o directions for use, if applicable (such as, safe cooking instructions); and
o food safety statements for meat or fish, if applicable (for example, previously frozen, mechanically tenderized meat).8
Where any of this labelling information is missing from the label of a foodservice package, it may accompany the food packaging in any format and by any means (such as a sticker), so long as that information is available to the ultimate consumer or purchaser. Further, while it is strongly recommended the labelling information be in both English and French, having the label in only one of these languages is sufficient if this information is otherwise available to be reviewed upon request.
Notably, the labelling required by the CFIA does not include a nutrition facts table, nor is there any requirement to comply with the standard container sizes set out in the SFCR. Both of these requirements would potentially be complicated and costly steps for small businesses or restaurants to satisfy in attempting to repurpose their food product inventories during the pandemic.
In addition, CFIA has advised it will not object to the re-importation of food products made, packaged and labelled in Canada for foodservice use that are labelled according to U.S. requirements. Those products may be sold in Canada without any changes to the label if:
All of the above are important steps in getting foodservice products into the consumer food supply without the cost and complications of meeting all of Canada’s labelling requirements. However, if a business intends to manufacture, process, treat or preserve foodservice products (such as by freezing, drying, smoking, slicing, etc.)9 , for the purpose of export or interprovincial trade, those activities are subject to SFCR licensing requirements, and must be carried out in a licensed federal establishment.
All of the above applies to foodservice foods that were:
These suspensions will cease 90 days after April 6, 2020, and all labelling requirements for retail food will again apply.
COP26, the 26th Conference of the Parties to the UNFCCC, will take place between 1 and 12 November 2021 in Glasgow.
© Norton Rose Fulbright LLP 2021