Commercially Connected Shorts - 11 December 2024

This week we look at:

• Consumer: Government unveils final details on the advertising of less healthy food on TV and online
• ESG: Transparency in the value chain: Implications of the EU CSDDD
• Trade: Countdown to UK accession to Comprehensive and Progressive Agreement for Trans-Pacific Partnership (‘CPTPP’)
• Cyber: Understanding the registration and reporting requirements of the EU NIS2 Directive

Government unveils final details on the advertising of less healthy food on TV and online

On 3 December 2024, the Government revealed the measures on advertising it will take to curb childhood obesity.  These include:

• TV adverts for foods high in fat, salt or sugar (‘HFSS’) to be shown after 9pm watershed
• A ban on paid online HFSS adverts

The food and drinks industry now has the details it needs to prepare for the regulations coming into force on 1 October 2025 with guidance on the categories covered by the regulations.

In summary, the new Advertising (Less Healthy Food Definitions and Exemptions) Regulations 2024 (‘Regulations’) cover:

• businesses involved with the manufacture or sale of food or drink with 250 or more employees, including franchises and symbol groups, who pay to advertise less healthy food or drink products. The sale of food/drink extends beyond retail to cafes, restaurants and takeaways
• ‘less healthy food’ which is determined according to technical guidance and the product categories identified in the Regulations as being of most concern (e.g. sugary hot/cold soft drinks; savoury snacks such as crisps/crackers; breakfast cereals; confectionery; cakes; ices; biscuits; sweet pastries, bakes and desserts; sweet dairy; pizza; potato products and certain ready meals)

Further guidance is expected from the Advertising Standards Agency (‘ASA’) on how the Regulations will be enforced noting that whether an advert is subject to these restrictions will depend upon whether the less healthy product is ‘identifiable’ from the advertisement.

Transparency in the value chain: Implications of the EU CSDDD

The EU’s Corporate Sustainability Due Diligence Directive (CSDDD) represents a pivotal effort in tackling some of today’s most urgent global issues. As the effects of global warming escalate—through more frequent extreme weather events, deforestation and intensive farming practices—the urgency for responsible corporate behaviour grows significantly.  This article sets out the key components of CSDDD and looks at improving openness in the supply chain.

Key messages include:

• the application of the law to both EU and non-EU companies
• the legislation will have a ripple effect down the supply chain as smaller companies will report to those companies directly impacted by the directive
• in-scope companies must conduct comprehensive due diligence to pinpoint risks to environmental issues and human rights. Measures should be implemented to manage and mitigate identified risks and businesses must report their actions
• the increased openness serves several purposes: company accountability; improved consumer trust and enhanced investor confidence
• failure to comply has serious consequences, such as legal penalties, investor withdrawal, reputational damage and operational disruption

With thanks to Craig Rogers and Dominique Strieder

Countdown to UK accession to Comprehensive and Progressive Agreement for Trans-Pacific Partnership (‘CPTPP’)

On 5 December 2024, the UK and Malaysia jointly launched the countdown to the first free trade agreement between the two countries which will be enabled by the CPTPP coming into force on 15 December.

The benefits of the UK’s membership of the CPTPP are cited as being the removal of barriers to trade (tariffs) and increased opportunity for business and investment between the UK and  up to 12 participating countries enhancing supply chains and offering greater choice.

Current CPTPP members are Australia, Brunei Darussalam, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam. The Department for Business and Trade estimates that CPTPP area trade could boost the UK economy by approximately £2 billion per annum by 2040. Businesses that trade with CPTPP signatories, or wish to expand operations to do so, should start planning how they can take advantage of this arrangement.

Understanding the registration and reporting requirements of the EU NIS2 Directive

The NIS2 Directive (Network and Information Security Directive 2) is one of the European Union’s most ambitious initiatives to harmonise and strengthen cybersecurity across the bloc.

Since 16 January 2023, the directive has been in force with the goal of improving the resilience of organisations operating in critical sectors. Member States were required to transpose the directive into their national legislation by 17 October 2024. However, as of 28 November 2024, the European Commission identified that 23 Member States (including the Netherlands, Bulgaria, Germany, Ireland, Spain, France and Poland) had failed to meet this deadline.

This raises important questions: what are the consequences for organisations in these countries? Are registration and incident reporting obligations enforceable?  Our blog explores the legal implications of delayed implementation of the NIS2 Directive and highlights:

• the delay in implementation creates legal uncertainty
• NIS2 imposes several obligations on organisations in critical sectors. These include the obligation to report significant incidents to the competent authorities and a registration obligation within each Member State.  These obligations can only become enforceable after the Member State has transposed the Directive into national law
• at the moment, there is no legal basis to compel organisations to register or report incidents in those states without the national law which implements the Directive
• the absence of national law does not entirely negate the Directive’s impact and organisations should still prepare to be compliant by strengthening their security measures, developing incident management procedures and engaging the leadership in cybersecurity

With thanks to Olaf van Haperen, Robbert Santifort and Ilham Ezzamouri