Marketing Authorization to Permit a Lower Calcium Threshold for Exemptions from the Requirement for Prepackaged Products to Carry a Nutrition Symbol in the Case of Cheese, Yogurt, Kefir and Buttermilk: SOR/2024-89

Canada Gazette, Part II, Volume 158, Number 12

Registration
SOR/2024-89 May 15, 2024

FOOD AND DRUGS ACT

The Minister of Health issues the annexed Marketing Authorization to Permit a Lower Calcium Threshold for Exemptions from the Requirement for Prepackaged Products to Carry a Nutrition Symbol in the Case of Cheese, Yogurt, Kefir and Buttermilk under subsection 30.3(1)footnote a of the Food and Drugs Act footnote b.

Ottawa, May 13, 2024

Mark Holland
Minister of Health

Marketing Authorization to Permit a Lower Calcium Threshold for Exemptions from the Requirement for Prepackaged Products to Carry a Nutrition Symbol in the Case of Cheese, Yogurt, Kefir and Buttermilk

Interpretation

Same meaning

1 Words and expressions used in this Marketing Authorization have the same meaning as in the Food and Drug Regulations.

Exemptions

Cheese, yogurt, kefir and buttermilk

2 (1) Prepackaged products that are cheese or yogurt, including drinkable yogurt, and that are made from dairy products, kefir or buttermilk are exempt from the application of subsection B.01.350(12) of the Food and Drug Regulations, in respect of saturated fat and sugars, if the condition set out in subsection (2) is met.

Condition

(2) For the purposes of subsection B.01.350(9) of the Food and Drug Regulations, the prepackaged products must contain 5% or more of the daily value for calcium per serving of stated size or per reference amount, whichever is greater.

Cheese

3 (1) Prepackaged products that are cheese made from dairy products are exempt from the application of subsection B.01.350(12) of the Food and Drug Regulations, in respect of sodium, if the condition set out in subsection (2) is met.

Condition

(2) For the purposes of subsection B.01.350(11) of the Food and Drug Regulations, the prepackaged products must contain 5% or more of the daily value for calcium per serving of stated size or per reference amount, whichever is greater.

Coming into Force

Registration

4 This Marketing Authorization comes into force on the day on which it is registered.

REGULATORY IMPACT ANALYSIS STATEMENT

(This statement is not part of the Marketing Authorization.)

Issues

Adequate calcium intakes are necessary for bone health. Calcium is considered a shortfall nutrient due to inadequate intakes in Canada. To mitigate the possibility that the front-of-package (FOP) nutrition labelling Regulations may negatively impact calcium intakes in Canada, a Marketing Authorization (MA) is being introduced to expand the eligibility for the dairy-related exemptions from the FOP nutrition labelling requirement by implementing a lower calcium threshold for prepackaged products that are cheese or yogurt (including drinkable yogurt) that are made from dairy products, as well as for kefir and buttermilk. This MA is enacted under subsection 30.3(1) of the Food and Drugs Act (FDA).

Background

Adequate calcium intakes are necessary for bone health, and particularly to reduce the risk of osteoporosis, which is prevalent in Canada. Calcium is considered a shortfall nutrient due to inadequate intakes in Canada: at a national level, the prevalence of inadequate calcium intake varies widely, but tends to increase with age and is higher in women than in men. For example, 2015 Canadian Community Health Survey-Nutrition (CCHS) data indicated that males had a prevalence of inadequate intakes ranging from 32% at 19 to 30 years of age to 82% at 71 years of age and over. Females had a prevalence of inadequate intakes ranging from 58% at 19 to 30 years of age to 93% at 71 years of age and over.footnote 1

While many dairy products are important sources of calcium for people in Canada, they also contain nutrients of public health concern. In fact, 2015 CCHS data showed that, for males and females 19 years of age and over, dairy products, including cheese, were the main dietary source of saturated fat. Cheese was also an important contributor to sodium in the diet.

In 2022, the FOP nutrition labelling Regulations introduced mandatory FOP nutrition labelling for most prepackaged products that have saturated fat (sat fat), sugars and/or sodium levels at or above certain thresholds. Specifically, these Regulations require that such products display a nutrition symbol indicating that the products are “high in” the respective nutrient or nutrients of public health concern, unless otherwise exempt. The FOP nutrition labelling Regulations came into force on the date they were published in the Canada Gazette, Part II, on July 20, 2022, and are subject to a transition period that ends December 31, 2025. The levels of nutrients of public health concern in many dairy products, such as cheese and yogurt, exceed the “high in” nutrition symbol thresholds and, consequently, many of these products will be required to display a “high in” nutrition symbol once the transition period comes to an end.

To mitigate the possibility that FOP nutrition labelling could negatively impact calcium intakes in Canada, subsection B.01.350(9) of the Food and Drug Regulations (FDR) conditionally exempts cheese and yogurt made from dairy products, as well as kefir and buttermilk, from the requirement to display the “high in sat fat” or “high in sugars” nutrition symbol. To be eligible for these exemptions, the calcium content of the product must meet or exceed the applicable threshold set out in subsection B.01.350(12) of the FDR (see the table below for eligibility thresholds). Further, even if the calcium threshold is met, these exemptions are conditional upon the absence of ingredients containing saturated fat or sugars in the product [other than the ones identified in paragraphs B.01.350(9)(a) and (b) of the FDR, respectively].

In addition, given that sodium is required in the cheese-making process, subsection B.01.350(11) of the FDR fully exempts prepackaged cheese made from dairy products with a calcium content at or above the thresholds set out in subsection B.01.350(12) from the requirement to display the “high in sodium” nutrition symbol (see the table below). This exemption applies regardless of which ingredients in the product contain sodium.

The data to support the dairy-related exemptions came from the 2015 CCHS. It is possible that intake patterns in Canada could shift and dairy products such as cheese could no longer be an important source of calcium, negating the need for an exemption from the requirements implemented by the FOP nutrition labelling Regulations in the future. Therefore, when the FOP nutrition labelling Regulations were published, Health Canada committed to reassess the need for these exemptions after 10 years to take account of possible changes in dietary intakes of calcium.

When the FOP nutrition labelling Regulations come into force, many fine and fresh cheesesfootnote 2 will require a nutrition symbol because their calcium content does not meet the applicable threshold. Some stakeholders have expressed the concern that the requirement for the “high in” nutrition symbol on foods that contribute to calcium intakes may discourage people in Canada from consuming these foods. Although fine and fresh cheeses are generally lower contributors to calcium intakes compared to other cheeses, they may serve as a source of calcium for some people in Canada.

Objective

The objective of this MA is to expand the eligibility for the existing dairy-related FOP nutrition labelling exemptions by implementing a lower calcium threshold. The types of foods eligible for the exemptions remain the same as those currently set out in the FDR [i.e. prepackaged products that are cheese or yogurt (including drinkable yogurt) made from dairy products, as well as for kefir and buttermilk].

It is expected that, by implementing a lower threshold, this MA will increase the number of products, including fine and fresh cheeses, that are eligible for the conditional exemptions from the requirement to display the “high in sat fat” or “high in sugars” nutrition symbol [see subsection B.01.350(9), FDR]. Likewise, this MA will increase the number of prepackaged cheeses made from dairy products that are eligible for the full exemption from the requirement to display the “high in sodium” nutrition symbol.

A lower calcium threshold aligns with the rationale for the original exemption, which is to mitigate the possibility that the FOP nutrition labelling Regulations may negatively impact calcium intakes in Canada. This approach is also consistent with the conditions for making a “source of calcium” claim on the label.

Description

The MA will exempt additional products from the requirement to display the “high in” nutrition symbol by providing a lower calcium threshold than what is set out in the FDR, as indicated in the table below. The lower threshold will apply to both the conditional exemptions set out in subsection B.01.350(9) of the FDR (that conditionally exempt cheese and yogurt – including drinkable yogurt – that are made from dairy products, as well as kefir and buttermilk, from displaying the “high in sat fat” and the “high in sugars” nutrition symbol) as well as the full exemption set out in subsection B.01.350(11) of the FDR (that fully exempts cheese made from dairy products from displaying the “high in sodium” nutrition symbol).

The conditions that trigger the loss of the nutrient-specific conditional exemptions for saturated fat and for sugars will remain the same as those currently set out in the FDR.

This MA does not repeal the calcium thresholds in the FDR; instead, both the MA and the FDR set out calcium thresholds that can be used to determine whether a product is eligible for the conditional and full exemptions.

Table: Calcium Content Thresholds for Dairy-Related Conditional and Full Exemptions from the FOP Nutrition Labelling Requirement
Reference amount ≤ 30 g or mL Reference amount > than 30 g or mL
FDR ≥ 10% daily value (DV) per serving of stated size or reference amount, whichever is greater ≥ 15% DV per serving of stated size or reference amount, whichever is greater
MA ≥ 5% DV per serving of stated size or reference amount, whichever is greater ≥ 5% DV per serving of stated size or reference amount, whichever is greater

Coming into force and transitional provisions

This MA will come into force upon registration.

Regulatory development

Consultation

Subsequent to the publication of the FOP nutrition labelling Regulations on July 20, 2022, an industry association expressed concerns about the types of cheese that would not be eligible for the exemptions based on the calcium thresholds set out in the FDR. In March 2023, Health Canada received a proposal from this industry association to amend the FDR to exempt almost all fine and fresh cheeses by removing the calcium threshold for all types of cheese except processed and cream cheeses. In May 2023, Health Canada met with the stakeholder to review the Department’s analysis of the impact of their proposal on different types of cheese. In June 2023, Health Canada met with the stakeholder to discuss an alternative approach. Under this approach, eligibility for the existing dairy-related FOP nutrition labelling exemptions would be expanded by implementing a lower calcium threshold of 5% DV per serving of stated size or reference amount, whichever is greater, regardless of the product’s reference amount.

Notice of intent

On July 26, 2023, Health Canada met with several industry and health stakeholders to provide information on the planned publication of a notice of intent (NOI) regarding an MA to expand the eligibility for the dairy-related exemptions from FOP nutrition labelling as well as an MA to permit the voluntary fortification of vitamin D in yogurt and kefir made from dairy products. Twenty-five participants joined the meeting, including representatives from four industry associations and four health associations.

On July 28, 2023, Health Canada published the NOI online. An email was sent to over 7 100 accounts registered with the Department’s Consultation and Stakeholder Information Management System to inform them of the Minister of Health’s intention to expand the eligibility for the dairy-related exemptions from the FOP nutrition labelling requirement (via the enactment of one MA) as well as to permit the vitamin D fortification of yogurt and kefir made from dairy products (via the enactment of another MA).

Stakeholder comments relating to the MA to Permit a Lower Calcium Threshold for Exemptions from the Requirement to Carry a Nutrition Symbol in Cheese, Yogurt, Kefir and Buttermilk

Health Canada received 71 submissions on the proposal to introduce a lower calcium content threshold for the existing dairy-related exemptions from the FOP nutrition labelling requirement.

There was both support for and opposition to the proposal.

Comments are summarized below along with Health Canada’s response to concerns raised by stakeholders. Some comments received were not relevant to the proposal, and have been noted for future consideration.

Comments from stakeholders who supported the proposal

Comments from stakeholders in support of the proposal included claims that: dairy products contain a variety of nutrients; that their consumption can help reduce the risk of certain diet-related chronic diseases; and that the proposal would help further mitigate the possibility that the nutrition symbol could negatively impact calcium intakes in Canada.

Comments on the scope of products eligible for the dairy-related exemptions

Two stakeholders commented on the scope of products eligible for the dairy-related exemptions. One stakeholder representing a national non-governmental health organization stated that highly processed dairy products should not be eligible for these exemptions regardless of what calcium content threshold is applied. Highly processed cheese products, highly processed cheese spreads and drinkable yogurt were cited as examples of products that should be out of scope. The stakeholder expressed the view that ultra-processed foods are associated with several health conditions, including heart disease, diabetes, high blood pressure, obesity and cancer. The other stakeholder, an industry association, recommended expanding the scope of the dairy-related exemptions to include plant-based beverages given that vitamin D and calcium can be added to them.

Health Canada’s response

The types of dairy products eligible for the original exemptions were consulted on prior to finalization of the FOP nutrition labelling Regulations in the Canada Gazette, Part II. Eligibility for the exemptions was based on calcium content alone with no consideration for degree of processing since the intent was to mitigate possible negative impacts of FOP nutrition labelling on calcium intakes from important dietary sources of this shortfall nutrient. Changes to the types of products are therefore considered out of scope of this MA. Eligible products will remain cheese made from dairy products; yogurt made from dairy products; kefir and buttermilk.

As per Health Canada’s interim policy, plant-based beverages can have added calcium. The Department considered extending the dairy-related exemptions to plant-based beverages that meet the calcium threshold. However, the 2015 CCHS data indicated that fortified plant-based beverages are not consumed in high enough volumes to be considered important contributors of calcium for the general population. Health Canada recognizes that fortified plant-based beverages are used as substitute foods by some people in Canada and will reconsider whether these beverages should be eligible for an exemption when the Department reassesses the dairy-related exemptions in the future.

Comments about the existing dairy-related exemptions

Among stakeholders who did not support the lower threshold, an academic, a consumer and a non-governmental lifestyle organization also indicated that they do not support the dairy-related exemptions published in the FOP nutrition labelling Regulations in July 2022. Modelling data provided by the academic stakeholder suggests that any exemption for dairy products diminishes the potential reduction in overall intakes of nutrients of public health concern. This stakeholder noted that milk is the top source of calcium in the diet of the general population, not cheese or yogurt. The lifestyle organization questioned the beneficial effect for bone health of calcium from foods high in sodium and/or animal protein.

Health Canada’s response

Health Canada considers comments on the merits of the dairy-related exemptions out of scope given that the NOI did not seek input on repealing existing exemptions. Exemptions from the FOP nutrition labelling requirement are provided for redundancy purposes, for technical reasons and for food categories that have a recognized health protection benefit or are important sources of shortfall nutrients that are not readily available in other foods. Calcium is a shortfall nutrient that impacts public health of people in Canada and is not readily available across food categories in the food supply.

According to data from 2015 CCHS, milk is the top contributor of calcium for the general population in Canada. Cheese and yogurt rank second and fourth, respectively. Considering that calcium intakes are inadequate among people in Canada and that cheese and yogurt are top contributors of this essential nutrient, a health-related exemption was introduced in the FOP nutrition labelling Regulations to mitigate the possibility that the nutrition symbol could negatively impact calcium intakes. The need for the dairy-related exemptions will be reassessed in the future.

Comments on reduced effectiveness of FOP nutrition labelling

Health organizations and one academic stakeholder commented that introducing a lower threshold would result in an increase in dairy products being exempt which could undermine the effectiveness of the nutrition symbol as a tool for people in Canada to easily identify and compare products and would, therefore, not be aligned with the objectives of the Healthy Eating Strategy. They stated that increasing the number of “high in sat fat,” “high in sugars” and/or “high in sodium” dairy products eligible for an exemption would decrease transparency and access to information for consumers, especially those with low literacy, older adults and newcomers to Canada. The academic stakeholder suggested that intakes of nutrients of public health concern could increase as a result of the proposal.

Health Canada’s response

Health Canada has committed to developing messaging to communicate to the public about FOP nutrition labelling and plans to integrate FOP nutrition labelling information into its broader approach to educating the public about using nutrition labels to make healthy choices.

Implementing a lower calcium threshold would increase the number of dairy products eligible for the exemptions and ultimately result in fewer cheeses and yogurts that are required to carry a nutrition symbol. Based on Health Canada’s analysis of data from the Food Label Information and Price (FLIP) database,footnote 3 an estimated 13% of cheeses made from dairy products on the market would require a nutrition symbol based on the NOI proposal compared to approximately 27% based on the thresholds in the FDR. The impact on the estimated proportion of yogurt, kefir and buttermilk required to carry the symbol would be minimal.footnote 4 Health Canada estimated that almost all cheese made from dairy products would require a nutrition symbol without targeted exemptions. While many dairy products are significant contributors of saturated fat and sodium in the diets of people in Canada, many are also important sources of calcium. Cheese is the second most important source of calcium in the diet of people in Canada. Although fine and fresh cheeses are lower contributors to calcium intakes compared to some other cheeses, they may serve as a source of calcium. Adequate calcium intakes are necessary for bone health, and particularly, to reduce the risk of osteoporosis, which is prevalent in Canada.

Comments on misalignment with dietary guidance and nutrition labelling policy

An academic, a consultant and a range of health stakeholders commented that the proposal was not aligned with Health Canada’s dietary guidance, as outlined in Canada’s food guide, or recommendations from the World Health Organization and Clinical Practice Guidelines from Diabetes Canada, since it extends the exemptions to products that contain little calcium despite high levels of saturated fat or sodium. For example, Guideline 1 of Canada’s Dietary Guidelines (PDF) indicates that “Vegetables, fruit, whole grains, and protein foods should be consumed regularly. Among protein foods, consume plant-based more often. Protein foods include … lower fat yogurts, lower fat kefir, and cheeses lower in fat and sodium.” Stakeholders also noted that the priority should be to promote other foods in the marketplace that are not high in sodium yet are rich in calcium, such as almonds, canned salmon, fortified non-dairy beverages, milk, spinach and tofu.

The consultant and a health stakeholder noted that the proposal was not cohesive with the Department’s nutrition labelling policy, specifically with efforts to educate consumers about the footnote in the nutrition facts table, i.e. “5% DV or less is a little, 15% DV or more is a lot.”

A consumer also suggested that the existing exemptions impart a false sense of “healthfulness” to dairy-based products compared to similar products that are not made from dairy and noted that the proposal would further perpetuate this perception.

Health Canada’s response

Information on food labels, including the nutrition facts table, FOP nutrition symbols, and list of ingredients, is meant to help consumers make informed choices, particularly at point-of-sale, but it is not a substitute to dietary guidance. While FOP nutrition symbols can assist consumers in identifying food products that are high in nutrients of public health concern, consumers are encouraged to follow Canada’s food guide in order to make healthy food choices. The food guide provides clear information about which foods are important to consume regularly and which foods should be limited as part of a healthy pattern of eating.

The Department is developing messaging to communicate to the public about FOP nutrition labelling as part of a broader approach to educating about healthy eating and using labels. The Nutrition Labelling website information has also been updated to support people during the transition period, and communications activities will increase through multiple channels as the transition deadline approaches. Health Canada’s healthy eating education will make it clear that while information on labels can help inform decisions about nutrients of public health concern, not all foods without a FOP nutrition symbol are part of a healthy pattern of eating. Other parts of the label are also helpful, and the Department has recently improved the nutrition facts table and made the list of ingredients easier to use. Finally, Canada’s food guide includes many resources to help people understand healthy eating and follow its guidance, including recipes, articles and videos.

Comments on inconsistent rationale for health-related exemptions

One industry association and one industry stakeholder expressed concerns about the rationale for expanding the eligibility for the existing dairy-related exemptions, stating that it seemed arbitrary and inconsistent with Health Canada’s previous rationale for not granting a health-related exemption from the FOP nutrition labelling requirement for pantry bread. These stakeholders strongly recommended that Health Canada establish criteria and a formal process for reviewing requests for exemptions. They also expressed concern that the proposal unfairly favoured some products, stating that there are food categories and nutrients of equal or greater public health impact as calcium which are not eligible for an exemption, such as plant-based beverages, which provide calcium and vitamin D, and foods that are very high in fibre. They recommended that Health Canada review these and other food categories that they claimed have recognized health protection benefits and/or contribute to intakes of shortfall nutrients for possible exemption to further mitigate unintended negative consequences of FOP nutrition labelling.

Health Canada’s response

The amendment to implement a lower calcium threshold is not introducing a new exemption. Rather, it is an adjustment to existing exemptions to address the possibility that the nutrition symbol could negatively impact calcium intakes. Changes to the types of products eligible for exemptions were not within the scope of the proposal.

Exemptions from requiring a nutrition symbol are provided for redundancy purposes, for technical reasons and for food categories that have a recognized health protection benefit or are important sources of shortfall nutrients that are not readily available in other foods. The latter exemption is intended to avoid discouraging consumers from choosing foods in this category. Calcium is a shortfall nutrient that impacts public health and is not readily available to people in Canada across food categories in the food supply. Health Canada estimated that almost all cheese made from dairy products would require a nutrition symbol without targeted exemptions.

Health Canada remains committed to reviewing new evidence related to FOP nutrition labelling that may guide future decisions that support the overall intent of the policy. However, the Department considers that the existing exemptions are appropriate and adequate; no additional exemptions are being proposed at this time. As noted earlier, the need for the dairy-related exemptions will be reassessed in the future to take account of possible changes in dietary intakes of calcium.

Comments related to industry lobbying

A consumer and a non-governmental health organization expressed concerns that the proposal was influenced by industry lobbying.

Health Canada’s response

Health Canada remains committed to openness, transparency and meaningful engagement with the public and stakeholders on healthy eating initiatives. Information on stakeholder meetings and correspondence with Health Canada officials, including concerns raised by the dairy industry related to FOP nutrition labelling, is available on the following webpage of the Health Canada website: meetings and correspondence on healthy eating.

Comments related to data and evidence

A consultant noted that there was a lack of data and/or evidence in the NOI to support the proposal. The consultant and a non-governmental health organization suggested that further evaluation of the contribution of fine and fresh cheese to the calcium intakes of the Canadian population is warranted. An academic recommended that the proposal be rejected and that the existing dairy-related exemptions be reassessed earlier than Health Canada’s commitment of 10 years.

Health Canada’s response

While the FDR do not define “fine and fresh cheeses,” stakeholder feedback suggested that these include soft ripened, blue, feta, Parmesan, bocconcini, fresh mozzarella, ricotta and cottage cheeses. Consumption data from the 2015 CCHS is available for some of these fine and fresh cheeses, including Parmesan, ricotta and cottage cheeses. However, consumption data was limited or unavailable for other types of cheese. The data suggests that fine and fresh cheeses are generally lower contributors to calcium intakes at the population level compared to some other cheeses, such as cheddar.

Although fine and fresh cheeses are generally lower contributors to calcium intakes compared to some other cheeses, they may serve as a source of calcium. Therefore, the Department considers that implementing a lower calcium threshold will allow more varieties of cheese to be eligible for the exemption and will help mitigate the possibility that the nutrition symbol could negatively impact calcium intakes.

A lower calcium threshold will result in fewer fine and fresh cheeses requiring a nutrition symbol. Overall, Health Canada estimates that 538 fewer stock-keeping units (SKUs) of cheeses will require a nutrition symbol.footnote 5

Health Canada has committed to reassessing the dairy-related exemptions and considers that 10 years provides time to evaluate the impact of these exemptions and for up-to-date consumption data to become available.

Comments related to reformulation

Two non-governmental health organizations and an academic raised concerns that the proposal would result in fewer products requiring the nutrition symbol, which could reduce the incentive for manufacturers to reformulate their products. The academic stakeholder added that the proposed changes to the exemption criteria would dissuade manufacturers from making progress towards meeting the voluntary sodium reduction targets for processed foods.

Health Canada’s response

Reformulation to reduce saturated fat, sugars and/or sodium content to below the nutrition symbol threshold is a business decision that may simultaneously benefit consumers; however, it is not the main objective nor a requirement of the FOP nutrition labelling policy. The nutrition symbol is designed to help consumers make more informed choices by providing product-specific information to quickly and easily identify foods “high in” saturated fat, sugars and/or sodium.

In addition to changes in consumer behaviour, reducing sodium intakes requires decreases in the sodium content of foods. The voluntary sodium reduction targets for processed foods 2020–2025 are designed to guide the food industry to further reduce sodium in the food supply. The targets vary across 117 processed food categories and take into consideration food safety and functionality. Health Canada continues to encourage the food processing sector to achieve the sodium reduction targets by 2025 and will monitor progress.

Comments on the FOP nutrition labelling Regulations transition period, implementation and guidance

Two industry associations emphasized the need for timely implementation of the lower calcium threshold. One commented that if the MA is not published in a timely manner, then this could delay broader implementation plans, since companies are in the process of implementing FOP nutrition labelling. It was also noted that the timing of the publication of the MA could create challenges for companies who have already updated their labels based on the original calcium threshold in the FDR. The other industry association requested that the transition period for the FOP nutrition labelling Regulations be extended beyond 2030. They stated this would give more flexibility to bundle label changes in light of the proposed lower calcium threshold as well as mandatory label changes stemming from amendments to the Nutrition Labelling — Table of Reference Amounts for Foods and Nutrition Labelling — Table of Daily Values, to fortification levels of vitamin D in milk as well as proposed requirements for recyclability labelling and restrictions on advertising to children.

The same industry associations also expressed the need for timely, updated guidance on how to apply the lower 5% DV calcium threshold, to limit any potential confusion during implementation.

Health Canada’s response

Given the straightforward nature of expanding an existing exemption, and the desire to provide greater certainty to regulated parties on labelling requirements well in advance of December 31, 2025, the end date of the transition period for the FOP nutrition labelling Regulations, the MA was selected as the appropriate instrument to expeditiously implement a lower calcium threshold to expand the eligibility for the existing dairy-related FOP nutrition labelling exemptions.

The requirements set out in this MA are permissive in nature. Regulated parties can choose whether to comply with the 5% DV calcium threshold set out in this MA, or with the existing 10% and 15% DV calcium thresholds set out in the FDR. Impacted parties who have revised labels based on the calcium thresholds set out in the FDR have the flexibility of retaining the label as is, using up stocks of those labels and implementing the threshold set out in the MA as part of future label redesigns, or redesigning labels immediately based on the threshold set out in the MA. This choice would be a business decision since regulated parties would be in compliance whether they implement the thresholds set out in the FDR or the threshold set out in the MA.

The Department considers that the existing transition period provides a reasonable balance between the time allowed for industry to comply with the regulations and the delay in benefit to people in Canada through their ability to make more informed purchases. Calcium thresholds have been set out in the FDR since July 2022 and remain valid. Health Canada is not extending the transition period to accommodate a second label redesign to adopt the threshold set out in the MA as this would be a business decision. The Department will provide industry with information on how to apply the lower threshold during the transition period and will continue to respond to related enquiries it receives from stakeholders.

Modern treaty obligations and Indigenous engagement and consultation

As required by the Cabinet Directive on the Federal Approach to Modern Treaty Implementation, an assessment of modern treaty implications was conducted. The assessment did not identify any modern treaty implications or obligations.

Instrument choice

In order to provide greater certainty to regulated parties on labelling requirements well in advance of December 31, 2025, the end date of the transition period for the FOP nutrition labelling Regulations, the MA was selected as the appropriate instrument to expeditiously implement a lower calcium threshold to expand the eligibility for the existing dairy-related FOP nutrition labelling exemptions.

Regulatory analysis

This section provides a brief description of the potential impacts of the MA on cheese, yogurt (including drinkable yogurt), buttermilk and kefir industry stakeholders (such as manufacturers, importers, food product labellers and packagers) in Canada; consumers of these products; and Health Canada and the Canadian Food Inspection Agency (CFIA).

The MA is permissive in nature. Health Canada anticipates that industry stakeholders whose products are within the scope of the MA will choose to apply the lower calcium threshold in the MA; however, it is not mandatory and they could choose to apply the thresholds set out in the FDR.

Sector profile

Health Canada estimates that an additional 538 cheese and 21 yogurt SKUs would not carry the nutrition symbol if industry stakeholders choose to apply the lower calcium threshold in the MA.

In 2022, Canada produced approximately 535 thousand metric tons of cheese. Canada exported 7.6 million kilograms of cheese amounting to approximately $68 million (CAD) in value. Canada imported 51 million kilograms of cheese in the same year. Cheese consumption of an average Canadian has increased from 11.1 kilograms in 2010 to 13.1 kilograms in 2021.footnote 6 It is anticipated that this consumption rate will continue to grow to approximately 13.5 kilograms in 2023footnote 7 an increase of over 15% since 2010.

The revenue of the yogurt market is reported at $2.9 billion in 2022.footnote 8 Annual growth rates were seen in the revenue of the yogurt industry in Canada between 2018 and 2022, and it is expected that the revenue will continue to grow in coming years. Canada imported $5.75 million worth of yogurt and exported $75.6 million worth of yogurt in 2022.footnote 8

Due to the permissive nature of the MA, this cost-benefit analysis (CBA) will not quantify impacts to stakeholders in a CBA statement.

Costs

Cost to industry stakeholders

Health Canada does not anticipate any incremental cost to result from the MA. Health Canada assumes that by implementing a lower calcium threshold, this MA will allow for the possibility of financial savings for industry stakeholders whose products are within the scope of the MA and who have not yet updated their product labels to comply with the thresholds implemented as part of the FOP nutrition labelling Regulations.footnote 9

Health Canada assumes that industry stakeholders will decide to apply the calcium threshold set out in this MA or in the FDR based on the profit maximization principle and on maintaining the competitiveness of their products in the Canadian market. However, given that the MA is permissive, this cost-benefit analysis does not report the net incremental costs or savings since the direction stakeholders take is considered to be a voluntary business decision.

Cost to consumers of the products

If industry stakeholders choose to apply the lower calcium threshold set out in the MA and the ingredient condition is respected, consumers of products that would otherwise be required to carry a nutrition symbol will no longer be informed of the high content of saturated fat, sugars or sodium in these products by way of the nutrition symbol. They will need to refer to the nutrition facts table for similar information in order to make product comparisons that could be easier using the nutrition symbol. If industry stakeholders already applied the nutrition symbol on their product labels before this MA comes into force and subsequently choose to implement the lower threshold set out in the MA, it may lead to confusion among consumers of the impacted products.

Cost to the government

If industry stakeholders with products within the scope of the MA choose to apply the lower calcium threshold set out in the MA, it is assumed that any potential incremental efforts to be incurred by the CFIA would be minimal and manageable within its existing resources and that any incremental change in costs would be negligible. It is anticipated that the MA will result in incremental effort required by Health Canada for its implementation such as to provide information to industry stakeholders about the MA and how to apply the lower calcium threshold. As the number of SKUs to be implicated by this MA constitutes only 1.2% of the total number of SKUs affected by the FOP nutrition labelling requirement, this analysis assumes the net impact of the MA to Health Canada and the CFIA to be cost-neutral.

Benefits

Benefit to industry stakeholders

Health Canada estimates that introducing a lower calcium threshold could lead to an additional 559 SKUs of cheese and yogurt that may not carry a nutrition symbol. Using $12,124 (in 2023 CAD)footnote 10 per SKU as the cost to conduct a labelling change, it is estimated that implicated cheese and yogurt industry stakeholders could save up to $6.78 million since they would no longer be required to redesign and print new labels, by December 31, 2025, when the transition period for the FOP nutrition labelling Regulations ends.

This MA provides flexibility to industry stakeholders to apply the thresholds set out in the FDR or the threshold set out in the MA. Those who have already changed labels to align with the applicable threshold set out in the FDR could choose to re-label if their products meet the lower threshold in the MA. Industry stakeholders that have already incurred costs associated with such a label change could also choose to retain the label with the “high in” symbol based on the applicable threshold set out in the FDR. This would be a voluntary business decision.

In general, the “high in” symbol on the principal display panel of a food label is expected to result in a shift in purchasing behaviour from foods with a nutrition symbol to foods without this nutrition symbol. The conditional exemption from complying with the FOP nutrition labelling requirement may help industry stakeholders of certain foods (cheese and yogurt made from dairy products as well as kefir and buttermilk) to maintain their market status. Therefore, these industry stakeholders would not need to adjust their production or supply of products to avoid a potential shift in market demands.

Benefit to consumers

Consumers will have access to a greater variety of products that are a source of calcium which are not required to display the nutrition symbol. This is intended to mitigate the possibility that the nutrition symbol could negatively impact calcium intakes among people in Canada.

Benefit to the government

It is also assumed that the CFIA will benefit from effort and time savings in the enforcement activities that are associated with this MA although these savings are negligible compared to the total cost to implement the FOP nutrition labelling requirement.

Small business lens

The small business lens does not apply to the MA, as it is a permissive proposal in that it expands the dairy-related FOP nutrition labelling exemptions by implementing a lower calcium threshold. Similar conditions are applicable to all industry stakeholders, without imposing additional administrative or compliance costs on small businesses. This MA will eliminate the need for a label change for industry stakeholders with products that would otherwise have been required to carry the nutrition symbol based on the calcium thresholds set out in the FDR, which will benefit small businesses in this market segment as well. Thus, this MA may strengthen the sustainability of small businesses in the Canadian market.

One-for-one rule

The one-for-one rule applies, as this permissive measure will be introduced as a new MA (which is considered an “IN”). However, Health Canada will be repealing several MAs in relation to its current efforts to modernize certain food regulatory frameworks in Part B of the FDR. Overall, this MA will be cost saving to some industry stakeholders within the defined scope. Due to its voluntary nature, Health Canada considers this MA as administratively neutral.

Regulatory cooperation and alignment

Expanding the eligibility for the dairy-related exemptions from the FOP nutrition labelling requirement by implementing a lower calcium threshold does not change the regulatory cooperation and alignment analysis provided in the FOP nutrition labelling Regulations.

Strategic environmental assessment

In accordance with the Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals, a preliminary scan was conducted which concluded that there will be no expected important environmental effects, either positive or negative; therefore, a detailed analysis is not required.

Gender-based analysis plus

No gender-based analysis plus (GBA+) impacts have been identified for this MA. This MA is not expected to have any disproportionate impacts on individuals or groups based on identity factors.

Implementation, compliance and enforcement, and service standards

Implementation

Health Canada will post information about this MA on its website and will notify stakeholders accordingly. The applicable requirements are permissive in nature, and manufacturers can choose whether to comply with the new requirements set out in this MA or to comply with the existing requirements set out in the FDR. The new permissive measures of the MA come into force upon its registration and manufacturers are not required to submit a premarket notification or a Temporary Marketing Authorization application in order to apply the permissive requirements.

Compliance and enforcement

Compliance and enforcement of this MA will be incorporated into existing activities carried out by the CFIA under the provisions of the FDA and its regulations, and other applicable food-related legislation enforced by the CFIA.

The CFIA is responsible for the enforcement of the FDA as it relates to food. While it is the responsibility of the industry to comply with regulatory requirements, compliance will be monitored as part of ongoing domestic and import inspection programs, respecting the resources that the CFIA has for enforcement and compliance verification. Appropriate enforcement action will be taken based on risk.

Contact

Bruno Rodrigue
Executive Director
Office of Legislative and Regulatory Modernization
Policy, Planning and International Affairs Directorate
Health Products and Food Branch
Health Canada
Holland Cross, Suite P2108
11 Holland Avenue
Ottawa, Ontario
K1A 0K9
Address locator: 3000A
Email: lrm.consultations-mlr@hc-sc.gc.ca