ef="https://insidefmcg.com.au/2021/03/01/accc-to-clamp-down-on-infant-formula-advertising/">marketing of toddler milk products, which is currently permitted under the agreement, is undermining its effectiveness.

“The ACCC has noted the rise in advertising for toddler milk products, and is aware of concerns that this may be used as a proxy to market infant formula. Our decision on whether to authorise this agreement was finely balanced as a result,” ACCC deputy chair Delia Rickard said.

“We can only grant authorisation in cases where the public benefit outweighs the detriment, and we carefully considered whether this agreement reached that threshold.”

Submissions to the ACCC, including from healthcare professionals, suggest that consumers could be confused between infant formula and toddler milk products and advertising.

“The issues raised by this application go beyond the scope of competition law, and raise significant health policy issues. We recognise that Australia’s response to health policy issues is a matter for the Australian Government,” Rickard said. 

WHO Code

The MAIF agreement is part of Australia’s obligations as a signatory of the World Health Organisation’s (WHO) International Code of Marketing of Breast-Milk Substitutes (1981), which was developed as a global public health strategy to ensure that mothers are not discouraged from breastfeeding.

In Australia, 29 per cent of children aged six months to three years were exclusively breast fed to six months, according to the Australian Bureau of Statistics’ 2017-2018 data. WHO’s target is to increase the global rate of exclusive breastfeeding to at least 50 per cent by 2025.

In 2016, WHO clarified that breast milk substitutes covered by the code should be understood to include toddler milk products, and that marketing of toddler milk products was effectively promoting infant formula.

Ahead of last week’s decision, Dietitians Australia recommended that the ACCC did not reauthorise the MAIF agreement, and instead suggested that better legislation is needed to enforce the WHO code. 

Alternatively, Dietitians Australia suggested that the MAIF agreement was reauthorised for two years only, and expanded to include the marketing of infant foods, toddler formulas, bottles and teats, as well as marketing and price discounting by retailers, in line with Australia’s agreement under WHO’s code.

“Marketing is a powerful tool that can sway consumers’ perception of a product,” said Dr Miranda Blake, accredited practising dietitian and chair of the Dietitians Australia Food Regulation and Policy Committee.

“The marketing of infant formulas and toddler milk must be covered under strong regulations to ensure Australian parents receive accurate information regarding nutrition for their child. In practice, this includes restricting most marketing by manufacturers and retailers to consumers.

“Legislation would help to address some of the public health policy issues that the MAIF agreement is unable to address such as retailer practices.”

“Restrictive” agreement

For Australian formula companies, it’s business as usual — for now. 

Sel Berdie, founder of plant-based formula company Sprout Organic, believes there is “no practical impact” for his business. 

“We have been highly engaged in the consultation process with the ACCC directly regarding this matter, and also as a member of the Infant Nutrition Council,” Berdie said. 

“We would have preferred a longer continuance to help support long-term strategy around our approach to market, yet the placement of the MAIF agreement within the regulatory framework, and the decision by the ACCC was expected.”

However, as a start-up in the industry, Berdie admits that the agreement is “restrictive” and has made things difficult. 

“Industry and product agreements like the MAIF agreement create a non-competitive environment, especially for a new market entrant and start-up business like ourselves. Remaining true to our message of being a product of choice, and not one of displacing breastfeeding, will always be our governing ethical stance as a company,” he said.

He said it’s “disappointing” that a ban on toddler milk advertising is being considered without providing the industry with guidance on how it would be measured and referenced.

Battling breastfeeding rates

The topic of infant formula marketing is being hotly debated in Ireland, where breastfeeding rates are the lowest in Europe, with fewer than 6 per cent of babies exclusively breastfed at six months, versus the European average of 25 per cent, according to the National Women’s Council (NWCI).

Consumers have heavily criticised underhanded marketing tactics from formula companies following a recent report in the Sunday Times, which revealed that formula company Cow & Gate was targeting Irish mothers with email marketing in the weeks after they gave birth. 

Cow & Gate, which is manufactured in Ireland and marketed by Danone, was reported to use Facebook competitions to build membership of its C&G Babyclub, which requires mothers to share their email address and due date.

“The email is timed around the due date. In the second week after birth, when 60 per cent of women are still breastfeeding, Cow & Gate sends an email titled ‘Is my baby getting enough milk?’, with links to articles about ‘Bottlefeeding tips and activities’ and ‘How to prepare a bottle’, as well as ‘How to breastfeed’. In the third week, the subject line is ‘Does my baby have colic?’, and in the fourth week it asks: ‘Tired all the time?’,” the Sunday Times article reads. 

The emails encourage parents to call its free “care line” for support. When the Sunday Times called the number and asked “How do I know if my baby is getting enough milk?”, the call handler reportedly recommended Cow & Gate’s hungry baby formula and did not ask about breastfeeding. 

A senior official at Unicef, the UN children’s agency, described the marketing as “outrageous” and “predatory”.

China is also battling low breastfeeding rates with the rate of exclusive breastfeeding among Chinese infants within six months of birth sitting at 29 per cent.

According to Euromonitor, the market scale of China’s infant formula is nearly US$31.12 billion, accounting for about 50 per cent of the global market, with Nestle and Chinese dairy company Feihe the leading players, both with more than 13 per cent market share. Many ASX-listed companies, including Bubs Australia and A2 Milk, have taken advantage of the booming formula market in China. 

China is not a signatory to the WHO marketing Code and instead has its own regulations, which an International Baby Food Action Network report found is “weakly implemented”.

According to a 2019 survey conducted by China Development Research Foundation, the advertising and promotion of infant formula increases the likelihood of mothers feeding their babies infant formula in the first six months by 30.8 per cent.