In a stark illustration of the huge and unforeseen impact that European Union (EU) institutions can have on British businesses, an embattled meat company, faced with financial catastrophe by an EU-driven ban on its innovative products, has ended up at the epicentre of a blazing international row.
Newby Foods Limited uses a novel method of removing meat from butchered bones which is then pressed through small holes to remove any bone, gristle or sinew. The company says that its products are absolutely safe and virtually indistinguishable from ordinary mince.
The Food Standards Agency (FSA) allowed Newby Foods to label its products as ‘de-sinewed meat’ until April 2012. However, the company claims that the regulator then ‘keeled over’ under intense pressure from the European Commission and performed a dramatic volte-face.
The FSA imposed a moratorium on Newby Foods producing de-sinewed meat from lamb bones and re-classified its pork and poultry products as ‘mechanically separated meat’ (MSM), which is far less valuable because it cannot count towards the meat content of food products.
The company says that it lost £720,000 in the first six weeks after the decision was made and that it faced closure, with the loss of 40 jobs and £5 million of investment. It launched High Court proceedings and the dispute was referred to the European Court of Justice (ECJ) for a definitive ruling on whether its products could be sold as 'meat preparations'.
In granting the company interim relief, pending the ECJ’s decision, the Court allowed it to sell 51 tonnes of de-sinewed lamb that had been sitting in its cold store for use in cat and dog food and ruled that it could continue to produce de-sinewed pork and poultry products and sell them as meat preparations.
The FSA was directed to take no steps to enforce the moratorium in respect of the company’s poultry and pork products, but the Court stopped short of allowing Newby Foods to use ruminant bones – from cattle or sheep – in its production process pending the ECJ’s ruling.
The grant of interim relief brought a swift response from the Commission which intervened in the case and urged the court to amend its order. However, expressing ‘considerable sympathy’ for Newby Foods, the Court found that the Commission had not put forward any cogent reasons why assistance should not be extended to the company in relation to its pork and poultry products.
The Court was unconvinced that allowing the company to continue producing and selling those products on any interim basis would have ‘any adverse effect on the consumer or provoke action from other member states’. Noting evidence that meat suppliers in Italy, Germany and the Netherlands were producing de-sinewed pork and poultry without always labelling it as MSM, the Court observed that a refusal to help Newby Foods through the crisis ‘would almost certainly put it out of business’ However – ‘without any enthusiasm’ – the Court refused the company’s application to lift the ban on it producing de-sinewed meat from lamb bones.
In its ruling, the Court stated: ‘This is a very sensitive market in the light of recent scandals…there is a risk, albeit a very low one, that if the company were allowed to produce de-sinewed meat from lamb bones, this could produce some form of reaction from one or more other member states of the EU that could have the potential to damage the UK meat industry”.