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2022 | OriginalPaper | Chapter

1. Introduction

Author : Eva van der Zee

Published in: Sustainability Labels in the Shadow of the Law

Publisher: Springer International Publishing

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Abstract

Sustainability sells. Sustainable food is gaining popularity and businesses are taking note. Many food products are now labelled with sustainability information through logos, symbols, and texts. Such business-to-consumer (B2C) sustainability labels may reduce information asymmetry if they adequately communicate sustainability attributes to consumers. Consumers require such adequate communication since producers of food products often have more or better information about specific sustainability attributes of products or production processes compared to consumers. Information asymmetry is especially apparent for sustainability attributes, as these can be considered credence attributes and Potemkin attributes. This is less so for search attributes that are known before purchase and experience attributes that are known costlessly only after purchase. Credence attributes, such as the use of pollutants in the production process, are expensive to determine even after purchase, while Potemkin attributes, such as fair trade and animal welfare, cannot be verified by the consumer or external institutions at the end-product level.

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next chapter Regulatory Structure Underlying Sustainability Labels

Hahnel et al. (2015), p. 1392; For a definition of a label see Codex, 1985 rev. 1991.

Grunert et al. (2014), p. 177, Chap. 2, n 1; Van Dam and Van Trijp (2011), p. 726.

Spadoni et al. (2014), p. 142.

Nelson (1970), p. 311.

Darby and Karni (1973), p. 67.

Spadoni et al. (2014), n 3.

Horne (2009), p. 175, Chap. 2, n 5. See also Becher and Feldman (2016).

Cafaggi and Iamiceli (2013), p. 131, Chap. 3, n 2.

Akerlof (1970), p. 488.

See on the impact of neoclassical law and economics in EU unfair commercial practices law: Micklitz (2008); Faure and Luth (2011). See on the impact of neoclassical law and economics in EU competition law: Heinemann (2015).

Nourse and Shaffer (2009), p. 66.

Ibid, 66.

For a summary and defence of rational choice theory, see the founding father of law and economics, Posner (1997), p. 1551.

Faure and Luth (2011), n 10.

Autoriteit Consument en Markt, ‘Analyse ACM van Duurzaamheidsafspraken ‘De Kip van Morgen” (Autoriteit Consument en Markt, 2015) <https://www.acm.nl/nl/download/publicatie/?id=13758>.

Ibid; Monti and Mulder (2017), p. 641. A more recent draft guide can be found here: Autoriteit Consument & Markt, ‘Guidelines Sustainability Agreements. Opportunities within Competition Law’, https://www.acm.nl/sites/default/files/documents/second-draft-version-guidelines-on-sustainability-agreements-oppurtunities-within-competitionlaw.pdf.

The revolution in psychology that has changes perceptions of how people act in economic circumstances may have started with Herbert Simon’s paper in 1955 for which he won the 1978 Nobel Prize in economics that introduced the concept of bounded rationality. Simon (1955), p. 99.

Monti and Mulder (2017), n 16, p. 636.

See for more information on the working procedures of the Advertising Code Committee: Stichting Reclame Code, ‘The Dutch Advertising Code and Working Procedure’ (Stichting Reclame Code, 2022), https://www.reclamecode.nl/nrc_taxonomy/general/?lang=en.

Case Greenpeace v DUPAN Greenpeace v DUPAN, Dossier 2011/00590.

See ibid.

Ibid.

See e.g., Case 315/92 Clinique, ECLI:EU:C:1994:34 and Case 210/96 Gut Springheide, ECLI:EU:C:1998:369.

Incardona and Poncibò (2007), p. 21; Howells and Weatherill (2005).

Franck and Purnhagen (2014); Incardona and Poncibò (2007); Schebesta and Purnhagen (2016), p. 590; Sibony and Helleringer (2015); ibid; Trzaskowski (2011), p. 383; Purnhagen (2017), p. 437.

Regulation (EC) No 1830/2003 of the European Parliament and of the Council of 22 September 2003 concerning the traceability and labelling of genetically modified organisms and the traceability of food and feed products produced from genetically modified organisms and amending Directive 2001/18/EC, Article 4B.

Regulation (EC) No 1830/2003, Article 1 in conjunction with Recital 4.

Zerbe (2004), p. 593.

Green and Scott Armstrong (2012), p. 293.

See e.g. the preamble to the Treaty on European Union (TEU) stating the determination “to promote economic and social progress for their peoples, taking into account the principle of sustainable development”; Article 3 TEU states that the Union’s “aim is to promote (…) well-being of its peoples, which can arguably be equated with sustainable development or at least is an important component of it (see e.g. Stiglitz et al. 2009); the preamble to the Charter on Fundamental Rights (CFR) states that the EU “seeks to promote balanced and sustainable development. The EU has mainstreamed sustainable development policies through the EU Sustainable Development Strategy, the Environmental Technologies Action Plan, and the Europe 2020 Strategy, for which sustainable consumption is a priority.

Tversky and Kahneman (1974), p. 1124.

Adler and Posner (2008), p. 253.

See on doctrinal research as a legal method at Hutchinson (2014), p. 584.

Hunt (1986), p. 1; Nourse and Shaffer (2009), n 11.

Michaels (2012), p. 110.

Bengoetxea et al. (2001), p. 48.

See Articles 31-2 Vienna Convention on the Law of Treaties. The VCLT states that, in accordance with the general rule of interpretation, a treaty must be interpreted in good faith in accordance with the ordinary meaning to be given to the terms of the treaty (i.e. textual interpretation) in their context (i.e. contextual interpretation) and in the light of its object and purpose (i.e. teleological interpretation). When interpretation according to the general rule of interpretation leaves the meaning ambiguous the VCLT states that, in accordance with supplementary means of interpretation, resource may be had to the preparatory work of the treaty.

See e.g. Van Damme (2010) and Lenaerts and Gutiérrez-Fons (2013–4).

See for the increasing importance of the travaux préparatoires in EU law: Lenaerts and Gutiérrez-Fons (2013–4), n 38; and Case 370/12 Pringle, ECLI:EU:C:2012:756. See for a discussion of the use of the negotiating history by the WTO Appellate Body. Van Damme (2010), n 38.

This is in line with Article 31(1) VCLT where the actual terms of the text must be the starting point of analysis. See Van Damme (2010), n 38. Furthermore, in accordance with settled ECJ case law, where the wording of an EU law provision is clear and precise, its contextual or teleological interpretation may not call into question the literal meaning of the provision, as this would run counter to the principle of legal certainty and the principle of inter-institutional balance enshrined in Article 13(3) TEU. See, e.g. Case 48/07 Les Vergers du Vieux Tauves, ECLI:EU:C:2008:758; Case 263/06 Carboni e Derivati, ECLI:EU:C:2008:128; Case 220/03 ECB v Germany, ECLI:EU:C:2005:748.

Lenaerts and Gutiérrez-Fons (2013–4), n 38.

Generally relied upon by the WTO Appellate Body. See Van Damme (2010), n 38, p. 623.

Case US-Gambling United States-Measures Affecting Cross-Border Supply of Gambling and Betting Services (US-Gambling), WT/DS285/AB/R, at. 164.

Van Damme (2010), n 38, p. 625.

See also McNair (1961), p. 366, where he makes a distinction between the absolute and relative meaning of a term. See also Case Chicken Cuts European Communities-Customs Classification of Frozen Boneless Chicken Cuts (EC-Chicken Cuts), WT/DS269/AB/R, WT/DS286/AB/R, at 175, were the WTO Appellate Body held that dictionaries were not always dispositive in finding the ordinary meaning and that ‘the ordinary meaning of a treaty term must be ascertained according to the particular circumstances of each case’, and that the ordinary meaning ‘must be seen in the light of the intention of the parties as expressed in the words used by them against the light of the surrounding circumstances’.

This is especially important in assessing EU law due to the principle of linguistic equality. See Article 55 TEU in conjunction with Article 342 TFEU, and Case 296/95 The Queen v Commissioners of Customs and Excise, ex parte EMU Tabac and Others, ECLI:EU:C:1998:152 at 36; Case 257/00 Givane and others, ECLI:EU:C:2003:8 at 36; Case 152/01 Kyocera, ECLI:EU:C:2003:623 at 32. The WTO Appellate Body also sometimes resorted to assessing the treaty terms in different languages. See e.g. Case EC-Asbestos European Communities-Measures Affecting Asbestos and Asbestos-Containing Products (EC-Asbestos), T/DS135/AB/R, at 89, 91-2 attempting to define ‘like products’ assessing the French and Spanish versions of the treaty language.

Lenaerts and Gutiérrez-Fons (2013–4), n 38; Case 341/01 Plato Plastik Robert Frank, ECLI:EU:C:2004:254 at 64; Case 236/97 Skatteministeriet v Aktieselskabet Forsikringsselskabet Codan, ECLI:EU:C:1998:617 at 28; Case 449/93 Rockfon A/S tegen Specialarbejderforbundet i Danmark, ECLI:EU:C:1995:420 at 28; Case 30/77 Regina v Bouchereau, ECLI:EU:C:1977:172 at 64.

See e.g. Article 7 TFEU(“The Union shall ensure consistency between its policies and activities, taking all of its objectives into account and in accordance with the principle of conferral of powers.”); Lenaerts (2007).

This technique has been used by the WTO Appellate Body as well as by the ECJ on several occasions. See for the WTO e.g. Case US-Wheat Gluten United States-Definitive Safeguard Measures on Imports of Wheat Gluten from the European Communities (US-Wheat Gluten), WT/DS166/AB/R, at 72–79; see also Case US-Lamb United States-Safeguard Measures on Imports of Fresh, Chilled or Frozen Lamb Meat from New Zealand (US-Lamb), WT/DS177/AB/R, WT/DS178/AB/R at 162–181; Case US-Line Pipe United States-Definitive Safeguard Measures on Imports of Circular Welded Carbon Quality Line Pipe from Korea (US-Line Pipe), WT/DS202/AB/R, at 209–211. Compare with Case Concerning the Auditing of Account between the Kingdom of the Netherlands and the French Republic pursuant to the Additional Protocol of 25 September 1991 to the Convention of 3 December 1976 on the Protection of the Rhine against Pollution by Chlorides, PCA Award Series (2008) 107, at. 91. For the use of cross-referencing by the ECJ see e.g. Case 465/07 Elgafaji, ECLI:EU:C:2009:94; see also Lenaerts (2010), p. 255 who provides a commentary on the merits of that case.

Fritzmaurice (1957), pp. 9 and 211. See also, e.g., Case International Status of South-West Africa, Dissenting Opinion of Judge de Visscher International Status of South-West Africa, Dissenting Opinion of Judge de Visscher, ICJ Reports 1950 at 187; Case Case Concerning Right of Nationals of the United States of America in Morocco (France v. United States of America) Case Concerning Right of Nationals of the United States of America in Morocco (France v. United States of America), ICJ Reports 1952, at 209; Case Ambatielos Case (Greece v. United Kingdom) (Merits: Obligation to Arbitrate), Joint Dissenting Opinion of Judges McNair, Basdevant, Klaestad, and Read Ambatielos Case (Greece v. United Kingdom) (Merits: Obligation to Arbitrate), Joint Dissenting Opinion of Judges McNair, Basdevant, Klaestad, and Read, ICJ Reports 1953 at 30; Emer De Vattel, The Law of Nations, or, Principles of Law of Nature Applied to the Conduct and Affairs of Nations and Sovereigns (4th edn, 1811), pp. 255–256.

See for the principle of effectiveness in international law: Van Damme (2010), n 38, p. 625. See on functional interpretation in ECJ case-law Case 439/08 VEBIC, ECLI:EU:C:2010:739 at 64; Case 188/10 Melki and Abdeli, ECLI:EU:C:2010:363 at 145; Case 409/06 Winner Wetten, ECLI:EU:C:2010:503 at 56.

Lenaerts and Gutiérrez-Fons (2013–4), n 38.

See on evolutionary interpretation Bernhardt (1999), p. 11; Helmersen (2013), p. 127.

See Hutchinson (2015), pp. 130, 132. who clarifies that ‘good’ quality doctrinal research should go “well beyond description, analysis, and critique, and invariably suggests ways the law could be amended or the philosophy, processes or administration of the law could be improved”.

See on the functional method, e.g. Michaels (2012), n 35; and Gordley (2012), p. 113.

KPMG, Expect the Unexpected: Building Business Value in a Changing World (Report: KPMG International, 2012).

Regulation (EU) 1169/2011 on the provision of food information to consumers (EU Food Information Regulation) [2011] OJ L 304.

See for example, Case Amestoy Amestoy, 92 F.3d 67 (2nd Cir. 1996); Case Pearson I Pearson I, 164 F.3d 650 (D.C. Cir. 1999), rehearing den., 172 F.3d 72 (D.C. Cir. 1999); Case Whitaker v Thompson Whitaker v Thompson, 48 F. Supp. 2d 1 (D.D.C. 2002); Case Boggs Boggs, 622 F.3d 628 (6th Cir. 2010).

In Recital 44 of Regulation (EU) No 609/2013 of the European Parliament and of the Council of 12 June 2013 on food intended for infants and young children, food for special medical purposes, and total diet replacement for weight control it is stated that “[t]his Regulation does not affect the obligation to respect fundamental rights and fundamental legal principles, including the freedom of expression, as enshrined in Art. 11, in conjunction with Art. 52, of the Charter of Fundamental Rights of the European Union, and in other relevant provisions.” Furthermore, Case 544/10 Weintor, ECLI:EU:C:2012:526 was the first, and so far only, ECJ-case concerning a fundamental rights challenge against a food labelling law.

See on the functional method, e.g. Michaels (2012), n 35; and Gordley (2012), n 55, p. 113.

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Title: Introduction
Author: Eva van der Zee
Publisher: Springer International Publishing
Book: Sustainability Labels in the Shadow of the Law
Print ISBN: 978-3-030-95801-5

Electronic ISBN: 978-3-030-95802-2

Copyright Year: 2022
DOI: https://doi.org/10.1007/978-3-030-95802-2_1

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