In 2013, Ontario’s New Democratic Party (NDP) proposed a bill requiring all food-service premises that are part of a chain with gross annual revenue of more than $5 million and a minimum of five locations within the province to post the calorie and sodium contents of their food and drink items. In 2014, the province’s Liberal party followed suit with the introduction of its own bill, MHCA. According to Chad Finkelstein, a franchising lawyer with Toronto-based Dale and Lessman LLP, the bill will likely become law given the Liberals won a majority in the 2013 provincial election.
MHCA differs somewhat from the NDP’s original proposal. It will require food-service premises that are part of a chain with a minimum of 20 Ontario locations to post caloric content of standard food and drink items. Finkelstein explains the law would apply to every person owning or operating a regulated food-service premise, including restaurants, grocery stores, convenience stores and other chains with 20 or more locations in the province, regardless of where the chain’s franchisor is based, which means foreign franchisors will need to learn about the new rules.
The predominant obligation for franchisees will be to ensure the number of calories in standard food items is displayed on each menu where it is listed or, if the item is on display, its identifying label. MHCA defines ‘menus’ as signs, boards and smaller materials, such as take-out menus. Calorie posting will apply to every variety, flavour and size of food or beverage, including combination meals treated as single standard food items. If franchisees are found to be non-compliant, however, Finkelstein explains the franchisors will be found liable.
When the bill is passed, franchisors will have to exercise vigilance with their food supply to ensure every ingredient is purchased from a designated source to guarantee the caloric information is correct. And as Finkelstein explains, one issue regarding compliance remains: ‘standard food item’ is not yet fully defined, which will make it difficult for both franchisors and franchisees to know which items will require the information.
The U.S. introduced similar rules in 2014, but at the federal level, bringing consistency throughout its food-service industry, whereas Canada will have to work around different rules between provinces which, according to Finkelstein will ultimately raise compliance costs.