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The Label Wars: When Governments Define a Product, Some Win and Some Lose

FoodLabeling2-CSBy Lucas Witman

Last year, when media reports emerged that many Greek yogurts on the U.S. market contain additives that are not customarily introduced to the authentic product, many consumers ran to their refrigerators and combed through the ingredients listings on the labels of their favorite brands. Traditionally, Greek yogurt is produced by straining yogurt in cheesecloth to remove the whey, resulting in a thicker, more protein-rich product. Some companies, however, have begun adding thickeners like corn and tapioca starch to achieve this desired consistency. The result is often indistinguishable from the authentic product. However, the problem for many is that true Greek yogurt and the technologically enhanced version are often indistinguishable on store shelves. Both types of products can be labeled “Greek yogurt,” with no requirement that they identify on the front label when additives have been introduced.

The Greek yogurt controversy is just one example of a widening concern among U.S. consumers about how their products are being labeled. Unlike in some European countries where governing bodies more clearly define how foods must be labeled, U.S. companies have considerably more leeway in how they define themselves for consumers. As a result, many companies that produce Greek yogurt, but also olive oil, cheese, wine, meat, coffee and more have been criticized for misleading consumers into purchasing something that is somehow different from what they might expect.

When it comes to food labeling, a particular product may represent much more than just a potential profit to those who produce it. Many products are in fact reflections of cultural identity. Especially for foods and beverages that are tied to a specific region or nation, these items are often symbols of that place, highly valued and protected by those who live there. Thus, when a company reinvents the authentic components and methods behind products like Champagne, Parmigiano-Reggiano and Greek yogurt, the result can be damaging to those who are intrinsically tied to the real deal.

Nobody understands this threat more than the Europeans. For this reason, European governments have created a number of different food appellation systems that serve to carefully define different products and lay out how they must be labeled. In France, wines, cheeses, butters and agricultural products labeled AOC (Controlled Designation of Origin) must adhere to standards that have been clearly defined by the government. In Italy, produce, olive oil, balsamic vinegar, cured meats and cheeses labeled DOP (Protected Designation of Origin) are similarly protected. Italy offers a second appellation system for wines, labeling them DOCG (Controlled Designation of Origin Guaranteed), DOC (Controlled Designation of Origin) and IGT (Typical Geographic Indication). The European Union offers its own appellation for food and wine as well, designating certain products that meet its standards for authenticity as AOP (Appellation of Protected Origin). A number of other European countries have their own government-regulated appellation systems in place as well.


The benefits of appellation systems

Appellation systems offer the producers of certain foods, wines and agricultural products a number of advantages in the markets in which they are enforced. Perhaps most importantly, when governmental agencies monitor these products and enforce a certain standard, it protects the overall quality of the item. A consumer who purchases a DOP Balsamico di Modena, for example, can be assured that the vinegar inside the bottle is of a certain quality.

FoodLabeling1-CSMore than simply conferring quality on a product, however, these appellation systems also protect the economic and cultural traditions behind it. For example, although it may be easier and cheaper to change the recipe or production process behind Parmigiano-Reggiano, if a company wants to label the product as AOP, it must be made in the traditional manner.

In addition, for a region or country that relies heavily on a product either as a source of revenue or as a draw for tourism, these appellations ensure that another region or country can not lay claim to that same product. The French Champagne region, for example, has a significant economic interest in ensuring that it is the only place where its eponymous sparking wine can be produced.

One company that is particularly supportive of the EU-granted AOP appellation is Le Gruyère AOP, maker of authentic Gruyère cheese from Switzerland. Gruyère cheese has its origins in the Middle Ages. The cheese has been produced in its current state with its current recipe since 1115 A.D. Le Gruyère AOP is extremely proud of its long history and cheers the AOP appellation for preserving tradition.

“An AOP is really linked to your territory (because your base [of your product] is the origin and the landscape) and is actually a protection for your history,” said Philippe Bardet, Director of Interprofession du Gruyère AOP. “Sometimes we really think we are like in the old times, on a horse fighting to save our lives. Like the guardians of the temple, we fight to protect [our product] from copies and innovations.”

“At Le Gruyère AOP, we are known to be one of the most strict in Switzerland, but we know that the final quality of your product is what makes the consumer buy your product,” Bardet continued.

According to Bardet, his association has suffered losses, both financially and in terms of product reputation, when lesser companies in Europe, Russia, South Africa and elsewhere have made and marketed inferior cheeses under the name “Gruyère,” The AOP designation helps Le Gruyère protect its name and its product. Bardet said there has now been about a month of trademark protection for the cheese in the United States, and that the team at Le Gruyère is intent on legal action to protect the usurpation of the name.

“There is a big loss for our product, our producers and, in fact, at the end, the consumers, when you have a cheese sold under the Gruyère name that has no taste and no character,” Bardet said.

Outside Europe, government-regulated appellation systems are less common, and this has been a problem for many specialty food companies whose authentic products are in competition with lesser quality imitators. For example, authentic Jamaica Blue Mountain coffee is a highly prized version of the popular beverage, and that popularity has given birth to a number of inferior quality coffee blends falsely usurping this title.

“Jamaica Blue Mountain Coffee has a long and famous tradition of being the best coffee in the world because of its quality,” said Jamaican Senator Norman Grant, Managing Director and CEO of Mavis Bank Coffee Factory Limited, Jamaica’s largest Jamaica Blue Mountain Coffee processing facility. “Grown at the highest elevation in Jamaica, in the Blue Mountain range in the parishes of St. Thomas, St. Andrew and Portland, the product is clean in the cup…The traditional characteristic of the Jamaica Blue Mountain coffee is intense in its aroma with a medium body—mellow, floral—and chocolatey taste.”

Senator Grant argues that too often, customers purchasing a product labeled Jamaica Blue Mountain coffee may not be getting the real thing. “There are some companies that try to market Jamaica Blue Mountain coffee all over the world but without meeting the prescribed quality standard,” he said.

However, authentic Jamaica Blue Mountain coffee producers are working hard to remedy this situation. “The Coffee Industry Board of Jamaica has implemented a Trademark User License agreement where companies trading should sign a trademark user agreement,” Grant said. “Where this is not done, companies that breach this can be penalized or be sued.”

The government of Jamaica has gotten involved as well, taking the first steps to protect the name through a European-style appellation system. The Jamaican government, working with the Coffee Industry Board is working to enforce geographic standards, designating the official boundaries within which products labeled Jamaica Blue Mountain coffee can be cultivated. Although this is a work in progress, Senator Grant hopes that, over time, it will help to protect the product.


The downside

Despite the clear benefits that food and drink producers, consumers and entire regions garner from government-regulated appellation systems, critics argue that there are good reasons to eschew such systems.

First, in clearly defining what a product is, what must go into it and how it must be produced, the product is essentially standardized. As a result, producers who may want to approach the item in an innovative way may be stymied from doing so. If Salame Piacentino, for example, must be made with a specific seasoning blend, a company that wants to label its product as authentic Salame Piacentino will be prohibited from changing that recipe.

Another problem some have with these appellation systems is that they often favor larger more established companies, negatively impacting smaller independent producers. While it may be relatively easy for a major cheese company to follow the government’s strict standards and achieve EU certification for all of its products, a small Emmenthal producer may not be able to afford to follow these standards. In addition, she may not have the resources at her disposal to get required approval from the EU.

Finally, some connoisseurs of food and drink argue that these labels too often confer quality on products that have not earned it on the basis of their culinary merit alone. In short, simply because a cheese or sausage or olive oil or mushroom has earned the right to be labeled AOP or AOC or DOP does not mean that it is necessarily a “fine food.” Many simple agrarian staples, for example, long eaten as a means of subsistence, have developed unwarranted reputations as gastronomic delicacies simply by virtue of their appellation.

Responding to the criticism that the AOP appellation pushes smaller producers out of the production process, Bardet argues that this system is extremely welcoming and helpful to independent producers of Gruyère cheese. “We don’t think it is undemocratic,” he said. “The Gruyère AOP now represents 6,000 independents and is still accepting new ones. If anyone wants to come in, he can as long as he respect the rules.”

Senator Grant similarly argues that efforts by the Jamaican government to regulate Jamaica Blue Mountain coffee will not have a deleterious effect on small producers in the region, but rather would equally protect all producers of the beverage, regardless of size. “This, in my view, would not affect Jamaica Blue Mountain coffee business and small companies,” he said. “The main focus would be on the producers in the country of origin and…authenticating those companies who handle the brand.”

Regarding the criticism that appellation systems inhibit innovation, Bardet concedes that this is a necessary aspect of protecting the history behind his association’s product. “With an AOP, you are protected but also limited—no innovation is allowed,” he said. “We are the guardian of a history, a tradition.”

However, Bardet still argues that it is unfair to state that the AOP appellation in any way standardizes Gruyère. “In our opinion, this argument is not true,” he said. “If our product would be standardized it would be made in one big factory…We protect the producers…and want them to stay independent , with their know-how. This is the key.”


To follow in the footsteps of Europe?

From many producers of fine food and drink, both in the United States and around the world, a common lament is heard that they do not receive enough protection for their product when sold in this country. Until recently, this was the case for Le Gruyère, who just this year finally received trademark protection from the U.S. government. Many other companies, however, have not been as successful in protecting their unique products’ names and identities in the U.S. market, making it difficult to distinguish their authentic offerings from lesser imitators.

Still, in many ways, the U.S. specialty foods market potentially offers producers of gourmet products more unrestricted opportunities to craft truly one-of-a-kind products, outside the oversight of a governing body.

In addition, eschewing the bureaucracy associated with a government-regulated appellation system helps open the market up to more producers. Thus, the benefits of the European appellations must be weighted against the benefits of the freer, more open U.S. specialty food marketplace.

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