Arrested development

John Cooper, a partner in the regulation team at Wragge and Co LLP, predicts that food regulation will have continued to increase substantially and the enforcement of the regulations applying to manufacturers will have become more rigorous.

"If I were to look in the crystal ball I would expect the role of enforcement to have been taken away from local authorities and given to an expanded Food Standards Agency (FSA), which will have a network of regional and local offices," says Cooper. "It will have additional powers to enforce the law, including the imposition of civil penalties without recourse to the criminal justice system."

Cooper also envisages a situation whereby unannounced dawn raids by FSA inspectors will become a matter of routine, rather than an exception to the rule. And, he adds, businesses will have to register with, and be approved by, the authorities. "In effect, licences will be needed to carry on food manufacture, and they will be revoked or made conditional for serious or persistent breaches of the regulations."

Sean Elson, senior associate at Pinsent Masons also sees a system which relies less on putting offenders through the courts and more on dealing with them administratively. "We could start to see things like Negative Publicity Orders, where a manufacturer is forced to take out an advert in the papers or trade press explaining what it has done wrong," speculates Elson, who believes justice will become more restorative and risk-based, rather than prescriptive - a move that could make legislation less onerous for businesses.

But Cooper is less optimistic, believing that small and medium-sized enterprises will struggle to keep abreast of, never mind comply with, the overwhelming volume of legal requirements. He predicts that many businesses will fail or be shut down as a result.

As part of a knock-on effect, the financial markets will start paying greater attention to the increased regulatory risk, and the cost of capital for food manufacturers will increase substantially. He anticipates major waves of consolidation as businesses seek greater synergies in order to offset these costs and remain competitive.

This may sound pretty grim, but Cooper is quick to stress that it's not all bad news. Both he and David Young, partner in the regulatory group and food group member at Eversheds, foresee a harmonising of standards in years to come.

So where does this leave us when it comes to the hot topic of the moment: front of pack labelling? Perhaps somewhat optimistically, by 2020 Cooper envisages a harmonised system of nutritional signposting throughout the EU, applicable to all products.

Elson, however, believes that government won't crack the whip on this one: "I don't expect a really prescriptive regime - it's more likely to be a code of conduct."

Similarly, while Young can see how "legislation would be a small leap in the minds of legislators", he doesn't think it will become a reality. "We haven't been able to agree on a single scheme as it is," he says. And then there are the practicalities, for example, how much information consumers can take in on a label. "Will we end up having to read through a leaflet inside the pack, as we do with cosmetics?"

At the other extreme, Cooper predicts that the manufacture of certain unhealthy foods may become illegal, while others will have to carry cigarette packet-style health warnings.

The clampdown on unhealthy foods could extend to marketing, says Elson, who thinks there may be a complete ban on junk food advertising. "There is an outright ban on smoking now, so by the same token you can't rule it out ... maybe for alcohol too," he says. Young concurs, but fears the consequences: "Are we going to start to work on the way food is prepared and outlaw frying? It could all become a bit silly."

By now you might be wondering if it's best to get out while you still can, but don't panic, says Cooper. "It may all sound unremittingly grim, but I think a lot of businesses will be very successful in this market, so long as they stay at the leading edge of the trend and take full advantage of the consolidation opportunities that the market will present."

However, it won't be a walk in the park, he warns: "Those businesses which lag behind in grasping the political and legal reality will sooner or later be in trouble."

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