US exporters of alcohol beverages to Canada will soon face stiffer competition from their European rivals. The Canada-European Union Comprehensive Economic and Trade Agreement (CETA) is expected to come into force by June 1, 2017, and Canadian duties on EU wines, beer and other alcoholic beverages will go to zero immediately. While tariffs on EU wine imports are already fairly low, products such as ciders will have their current duty rate reduced from 28 cents per liter to zero immediately. In fact, the European Commission is already extolling the expanded export opportunities for EU wine and spirit producers as a major selling point for CETA.

The US is expected to enter into formal North American Free Trade Agreement renegotiations with Canada and Mexico this summer. US alcohol beverage producers and trade associations should act now to ensure that the US negotiators protect US market access in Canada and otherwise promote their interests.

The USDA report and list of EU products that will receive duty-free treatment under CETA is available here.

Earlier this month, the U.S. Food and Drug Administration (FDA) invited public comments on uses of the term “natural” in food and beverage labeling and whether “natural” should apply only to “unprocessed” foods.  The FDA’s definition of “food” includes alcohol beverages.  The FDA’s current policy is not to restrict use of “natural” unless a food has added color, synthetic substances and certain flavors.  The FDA also interprets “natural” to mean that a food does not have anything artificial or synthetic (including colors additives regardless of source) included in, or added to, the food that would not be expected to be in the food.  The U.S. Department of Agriculture (USDA) has a separate policy that defines “natural” with respect to meat and poultry products:  (1) the product does not contain any artificial flavor or flavoring, coloring, ingredient, chemical preservative, or any other artificial or synthetic ingredient and (2) the product and its ingredients are not more than minimally processed.

The agency sought comments in part because the FDA received four citizen petitions on the topic, including one citizen petition requesting consistency across FDA and USDA with respect to the definition of “natural.”  Federal courts also had requested that the agency determine whether food products with certain ingredients–high fructose corn syrup or ingredients produced using genetic engineering–could be labeled “natural.”  The FDA is interested in knowing under what circumstances the use of the term “natural” should be considered false or misleading.  In the notice, the agency indicated it could revise its policy on “natural” to address production practices used in agriculture and food manufacturing processes such as fermenting and pasteurizing.  The FDA has already received over 1,800 comments in less than two weeks.  The docket will remain open until February 10, 2016.