On November 24, 2014, the Ontario government introduced Bill 45, the Healthy Menu Choices Act, 2014 (the Act). This follows Bill 162, the Making Healthier Choices Act, 2014, which was introduced on February 24, 2014 but died as a result of the provincial election earlier this year.

If passed, the Act will require restaurant chains and other food service providers with 20 or more locations operating under the same, or substantially the same, name in Ontario to display the number of calories of all standard food or drink items on their menus, menu boards and displays. This would include not only quick-service restaurants, but also convenience stores, grocery stores or other businesses that sell meals prepared for immediate consumption either on the premises or elsewhere. It is not clear whether this would include owners of hospitals, schools, care homes and similar institutions; however, where such institutions have restaurant chains and other food service providers caught by the Act operating within the institution, the owners and operators of such restaurant chains and other food service providers must comply with the Act.

The Act would require the display of the number of calories of each variety, flavour and size of food and drink items that are offered with standardized portions and content and any “other information” required by the regulations with respect to such food and drink items. The Ontario government has yet to introduce draft regulations so it remains to be seen what “other information” will need to be displayed. The calorie content and prescribed information must be displayed on one or more signs, on each menu where the standard food item is listed, and, if the standard food item is on display, on the food’s label or tag. The information must be specific to each variety, flavour and size offered.

Franchisors should take note that the Act specifically includes franchisors in the definition of a “person who owns or operates a regulated food service premise.” While the manner in which the definition is drafted creates some uncertainty on this point, the inclusion of franchisor in this definition may mean that if the legislation is passed, both the franchisor and its franchisee could be found liable for failure to display the number of calories of all standard food or drink items on their menus, menu boards, displays and on one or more signs. The practical result of this liability structure will depend on the particular franchise system, but could prove troublesome for franchisors that do not have or want complete control over the supply chain.

Federal Requirements

Prepackaged foods sold in Canada are already subject to specific mandatory nutrition labelling requirements, including calorie content declarations, in the Nutrition Facts Table. However, most foods sold in restaurants and food service establishments are exempt, as are foods ordered for take-out and delivery. Although nutrient content claims for foods are permitted for use in restaurants (i.e., on menu boards, menus, promotional material), the Canadian Food Inspection Agency requires that such claims must generally meet the requirements applicable to most prepackaged foods as set out under the Food and Drug Regulations. The Act, therefore, will result in many affected food premise franchisors and other owners/operators having to now also comply with federal requirements.

Specifically, all of the nutrients, vitamins/minerals and the energy values listed must be declared per serving of stated size. This means the information must be shown per portion served to the customer. Further, all nutrient declarations must be shown in the prescribed units (i.e., fat content in grams). In some cases, including a declaration of the percent daily value (%DV) of a nutrient is acceptable provided that such declaration is in addition to the declaration of the nutrient in the prescribed unit. In addition, the declaration may not be modified or qualified by other words (e.g., “contains” 6 grams of fat is not permissible).

It remains to be seen what manner of disclosure requirements the Act will impose but franchisors and other affected food premise owners/operators will need to ensure both Ontario and federal requirements are being met.

Consequences of Non-Compliance

Penalties for non-compliance have been set for corporations at $5,000 for each day on which there is non-compliance for a first offence and a fine of up to $10,000 per day for any second or subsequent offence.  Liability is extended to directors and officers of a non-compliant corporation where such director or officer fails to take all reasonable care to ensure compliance with the legislation. The penalties for non-compliant individuals are set at $500 for each day on which there is non-compliance for a first offence and up to $1,000 per day for a second or subsequent offence.

Similar Initiatives in Canada and the United States

The Act follows from an announcement on October 9, 2013 that the Ontario government would begin consultations regarding the introduction of legislation that would require large chain restaurants to place caloric and other nutritional information on their menus and menu boards, and reflects a growing trend in food regulation requiring food service providers to present consumers with health information about their dietary choices. In 2010, the U.S. Congress passed a law requiring chain restaurants with 20 or more locations in the United States to provide calorie disclosure on menus and menu boards. The regulations were initially expected to be finalized and take effect in 2012; however, following a long debate in Congress, the U.S. Food and Drug Administration issued the final rules on November 25, 2014. In 2011, the Province of British Columbia introduced the Informed Dining Program, a voluntary nutrition information program for restaurants. Under the Informed Dining Program, participating restaurants provide their guests with easily accessible and understandable nutrition information for all standard menu items.

Conclusion

The Act received its second reading on December 3, 2014. It is still too early to say whether the Act will become law. However, the Ontario government appears committed to the issue of helping Ontarians make healthier food choices by mandating the posting of caloric and other nutritional information in the food service industry. If passed, the Act could have a significant impact on a number of food service providers, including, fast-food restaurants, convenience stores, grocery stores, bakeries and coffee shops as well as entertainment venues like movie theaters, amusement parks and bowling alleys. Food service providers and franchisors should take action now to review their systems and develop an action plan for compliance in the event the legislation is passed.