The Food and Drug Administration’s (FDA) long-anticipated menu labeling requirements went into effect on May 7, 2018. These requirements apply to predominantly to restaurant franchisees. As explained by the FDA:
“The menu labeling requirements apply to restaurants and similar retail food establishments that are part of a chain with 20 or more locations. In addition, they must be doing business under the same name and offering for sale substantially the same menu items.”
So, if you own a restaurant franchise in a system with 20 or more outlets, you are likely subject to the new menu labeling law. What do you need to know?
Franchisee Compliance with the FDA’s New Menu Labeling Requirements
1. The New Menu Labeling Law is Already Effective
First, May 7, 2018 was the compliance date for restaurant owners to adopt the new labeling requirements. If you are subject to the law and you have not yet updated your menus, you should consult with an attorney about coming into compliance promptly.
2. The Law Applies to More than Just “Restaurants”
The new labeling law applies to “restaurants and similar retail food establishments.” As explained by the FDA, this means that the law applies to all types of food service businesses. This includes:
- Coffee shops
- Convenience stores
- Food delivery and take-out businesses
- Food service locations in amusement parks and other entertainment venues
- Full-service restaurants
- Grocery stores
- Quick-service restaurants
- Specialty food stores
3. As a Franchisee, it is Up to You to Comply
As a franchisee, you own your business, and this means that it is up to you to comply with the law. This is a fundamental principle of the franchise relationship, and it is no doubt stated clearly stated in your franchise agreement. While you may expect your franchisor to provide the information and materials you need to comply, if it fails to do so, this will not absolve you of your legal obligations.
4. The FDA is Initially Pursuing an Approach of “Cooperative” Enforcement
While failing to adhere to the new menu labeling requirements constitutes a violation of the Food, Drug and Cosmetic Act (FDCA), as reported on Franchising.com, the FDA has stated that it intends to pursue a “cooperative” approach to enforcement when business owners make reasonable efforts to meet their new obligations. However, this may change over time, and franchisees should not rely on lenient enforcement when addressing questions of compliance. Additionally, since labeling violations will also generally constitute grounds for default and termination under most franchise agreements, franchisees will also need to be wary of the potential contractual consequences of noncompliance.
5. Franchisees that are Not Subject to the FDA’s Menu Labeling Law May Still be Subject to Labeling Requirements
Finally, even if your franchise is not subject to the FDA’s new menu labeling law, it may still be subject to labeling requirements at the state or local level. Several states and municipalities have enacted laws that require restaurants and other businesses to disclose more information about their menu items, and many of these laws apply to establishments that are not part of a large franchise system.
Contact a Franchise Lawyer at the Goldstein Law Firm
If you have questions about your legal obligations as a franchisee or what you are entitled to expect from your franchisor, you can contact the Goldstein Law Firm for a free, no-obligation consultation. To speak with franchise lawyer Jeffrey M. Goldstein in confidence, call (202) 293-3947 or request an appointment online today.