The National Grocers Association (N.G.A.) in public comments filed with the Food and Drug Administration (FDA) on July 5, strongly opposed the FDA’s proposed rule for mandatory menu labeling that would include supermarkets and grocery stores as similar retail food establishments to restaurants. N.G.A. urged the FDA to adopt its proposed alternative/Option 2, which would only cover establishments whose primary business activity is the sale of restaurant or restaurant-type foods to consumers. The alternative/Option 2 that would exclude supermarkets and grocery stores is estimated to cost 12.5 percent less than the proposed FDA requirements and would only reduce the mandatory menu labeling coverage of restaurant or restaurant-type food sales by only 5 percent.
“We encourage the FDA to incorporate our suggested changes in determining the final regulations. The proposed rules would add significant costs and burden to food retailers, independent retailers in particular and with little benefit to consumers,” said Tom Wenning, EVP and general counsel of N.G.A. “There is no rational basis for considering independent food retailers to be part of a chain just because they may operate under a common banner name. The proposed rule is flawed in that it indicates that a chain should be covered regardless of the type of ownership of the individual locations. Independent retailers own, control and operate their stores independently; choosing what products are sold, how they are presented and prepared for food displays.”
In addition, N.G.A. stated independent grocers will be disproportionately affected if grocery stores are included in the rule just because they sell “food,” or that the primary business as proposed is based upon 50 percent of the gross floor area or sales being “food.” If the law does not cover superstores, it must not cover grocery stores either. The alternative/Option 2 levels the regulatory playing field by using a primary business standard based upon 50 percent of gross floor area used for restaurant or restaurant-type food, or 50 percent of the establishment’s revenues are generated by the sale of restaurant or restaurant-type food. Superstores will have an unfair advantage because so much more of their floor space and sales are dedicated to non-food items while they sell significant volumes of food. Under the proposed rule, supermarkets are placed at a severe competitive and regulatory disadvantage and will be forced to spend millions of dollars to comply while supercenters do not.