Regulatory straitjacket

The question of regulation, and its impact on innovation and competitiveness in global markets, is a critical one for the food industry. Talk to most innovative companies in the sector and I suspect the majority believe that the negative impacts of regulation outweigh its positive effects. And genetically modified organisms (GMOs) and derived novel food products are a clear case in point.

Introduced at a time when trust in the food industry was at an all-time low, in the wake of BSE and other food scandals, GMO legislation in the 1990s aimed to protect human health, prevent or minimise potential harm to the environment and provide consumers with the information they needed to make informed choices.

The fundamental question was whether it was necessary to adopt specific regulations to handle GMOs, or whether existing food regulations provided an adequate framework.

The Europeans took the first approach by adopting the precautionary principle and the Americans took the second - working on the basis of substantial equivalence.

During the 1990s, the EU implemented Directive 1990/220/EEC, which regulated the deliberate release of GMOs into the environment, and Regulation 258/97/EC on Novel Foods and Novel Food ingredients.

However, this did not help biotech companies keen to get into Europe, as nearly all notifications for market approval of agricultural GMOs raised concerns from Member States. Therefore, in June 1999, all applications were effectively suspended until stricter safety, labelling and traceability rules were established.

After two further years of wrangling, Directive 2001/18/EC was passed in February 2001, replacing 1990/220/EEC. Under this Directive, commercial approval of GMOs would be given only for a 10-year period and could be extended for a further 10 years.

Additionally, it required post-market monitoring of all approved GMOs.

Labelling requirements were not clarified until late 2003, when Regulation 1829/2003/EC came into force. This stipulates that notifications for market approval of food and feed products from GMOs have to go to the European Food Safety Authority (EFSA), while all foods produced from GMOs, irrespective of whether there is DNA or protein of GM origin in the final product, must be labelled.

The labelling requirement does not, however, apply to the adventitious presence of GMOs approved for commercialisation in the EU below a 0.9% threshold.

There is clear evidence that the de facto moratorium has had a negative impact on innovation in agricultural biotechnology. This relates, in particular, to small firms that have often been forced to abandon such projects because of limited resources.

In stark contrast, a high number of herbicide and/or insect-resistant GM plants have been approved for commercial use in the US.

With almost 50M hectares planted in 2005, the US also grows more GM plants (mainly soy-beans, maize and cotton) than anyone in the world (less than 60,000 hectares of Bt corn were grown commercially in the EU - mainly in Spain).

Stifling innovation

Although some research and development (R&D) in agricultural biotechnology is still conducted in the EU, the area of plant biotechnology is the only sub-category of biotechnology research that declined significantly during the second half of the 1990s in the EU.

Put simply, the EU regulatory framework of the last decade has not helped development of GMOs in the EU.

During this period, increased regulatory oversight in agro-food biotechnology coincided with growing adverse public opinion and diminished trust in the authorities and the regulators.

In this context, companies regarded the constantly changing regulatory environment as a major constraint on R&D and commercialisation of GMOs in the EU. In particular, the practical handling of existing regulations was strongly criticised as being too slow, bureaucratic and extraordinarily costly.

Politicians were also criticised for not making a clear decision on GMOs that could have formed a reliable basis for companies to plan commercial activities - and even for periodically intervening in the regulatory processes.

What do consumers want?

Another major challenge for the European food industry is poor consumer acceptance of GM plants and food. According to the latest Eurobarometer survey on GMOs, published in 2005, only 27% of EU consumers were in favour of GM food.

Even in Spain, where more than 50,000 hectares of insect-tolerant maize have been planted in recent years, consumer support for GM food is only 7% ahead of the European average.

One simple reason for that could be that hardly any GM foods have been developed that offer clear and obvious benefits to consumers.

Indeed, there is some evidence to suggest that when consumers are presented with the positive benefits of a GM product, they modify their views.

However, other studies show that negative perceptions of the use of GM methods cannot be overcome by promised health benefits.

The extent to which consumers trust the source of information about GM is a key issue. Generally, consumers do not trust governments and scientists to be both the main promulgators of information on GM technology and, ultimately, responsible for controlling it.

Therefore, it is hardly surprising that the authors of the latest Eurobarometer survey conclude that recent pro-agro-biotech PR activities and new labelling rules have done little to allay public fears.

This is probably why most major food processing companies in Europe try to avoid the use of GM products and materials that have to be labelled.

Doomed to failure?

I suspect that health-beneficial GM foods, such as zero trans fat soybean oil and crops engineered to develop longer chain omega-3 fatty acids, will not enter the European market before the middle of the next decade.

However, analysis of other innovative areas of food production indicates that a strict but clear regulatory framework can have a positive impact on innovation.

With this in mind, politicians should provide an equally clear framework for agro-food biotechnology in the EU, while industry should develop products that offer obvious benefits to consumers.

These should be marketed with clear labels in order to ensure that consumers can exercise freedom of choice. If they are not, the industry could miss some great opportunities in the promising field of health-related food products in the EU.

Klaus Menrad​ is a professor at the University of Applied Sciences of Weihenstephan, Germany.