The Australian Competition and Consumer Commission (ACCC) has recently rejected a request from a local trade body to sanction an industry code aimed at limiting the advertising and promotion of infant formula.
The Infant Nutrition Council sought approval for a five-year extension of the Marketing in Australia of Infant Formula: Manufacturers and Importers Agreement (MAIF Agreement).
Initially implemented in 1992, the MAIF Agreement is a voluntary code that prohibits advertising infant formula for babies up to 12 months, aligning with Australia’s commitment to the WHO’s guidelines.
Given its nature as an agreement among competitors, the ACCC’s authorization is necessary.
Nevertheless, the ACCC has declined to authorize the infant formula marketing code, citing multiple factors that undermine the “effectiveness” of the MAIF Agreement.
Notably, these factors encompass the voluntary nature of the agreement, its limited scope, and its inadequacy in addressing a comprehensive range of digital marketing methods, according to the regulator.
The ACCC indicated that this decision is likely to result in public detriment due to decreased competition and increased barriers to entry stemming from competitors restricting promotional activities and monitoring each other’s marketing.
ACCC acting chair Mick Keogh noted, “We are not satisfied in all circumstances that the MAIF Agreement is likely to generate public benefits that will outweigh the public detriments.”
This statement contrasts with the ACCC’s position in 2021, where it recognized a “fine balance between likely public benefit and detriment,” asserting that the MAIF Agreement did yield a “net public benefit.”
An independent review conducted by Australia’s Department of Health and Aged Care, released in April last year, concluded that the current self-regulatory approach is “no longer fit for purpose.”
The review recommended establishing a stronger, mandatory regulatory framework to effectively regulate infant formula marketing and promote public health.
In response, the Australian government announced its plans in October to implement mandatory controls on infant formula marketing within an estimated two years, consistent with the review’s recommendations.
Moreover, breastfeeding advocacy groups have submitted that the MAIF Agreement is “ineffective” and should not be authorized, even temporarily.
Keogh added, “While the link between breastfeeding and improved health outcomes for mothers and children is undisputed, we are concerned several factors undermine the effectiveness of the MAIF Agreement in protecting breastfeeding rates.”
He further asserted, “We are not satisfied that the MAIF Agreement and associated guidelines will provide a net public benefit to justify authorization and consider it likely to result in public detriment through diminished competition between infant formula manufacturers and importers compared to the absence of such conduct.”
