Newby Foods Ltd, R (on the application of) v Food Standards Agency (No. 2)

Factual and Procedural Background

This opinion concerns a dispute over the classification of a meat product produced by the Appellant using a two-stage mechanical process. The Appellant's process involves removing meat from bones using a low-pressure vibrating piston machine, producing a product known as desinewed meat (DSM), which the Appellant contends is fresh meat or a meat preparation rather than mechanically separated meat (MSM) as defined under EU Regulation (EC) No 853/2004.

The procedural history includes a first judgment in which key questions of interpretation of the relevant EU regulation were referred to the Court of Justice of the European Union. The current judgment addresses the Appellant's application for interim relief pending the Court of Justice's decision. The Appellant challenges a moratorium imposed by the Food Standards Agency ("FSA"), the Respondent, which restricts the production and sale of DSM derived from ruminant bones, based on the European Commission's interpretation that DSM falls within the definition of MSM.

The dispute arises from differing interpretations of paragraphs 1.14 and 1.15 of Annex I to Regulation (EC) No 853/2004, which define MSM and meat preparations respectively. The Appellant argues that its product retains muscle fibre structure and should be classified as a meat preparation, whereas the Commission and FSA assert that any loss or modification of muscle fibre structure, however slight, results in classification as MSM, subject to stricter hygiene and marketing restrictions.

The moratorium followed an audit by the European Commission's Food and Veterinary Office (FVO) and subsequent communications from the Commission expressing concerns about the Appellant's production methods and classification of DSM. The Appellant claims significant financial losses and challenges the moratorium on grounds including error of law, breach of legitimate expectation, natural justice, proportionality, and duty of sincere cooperation.

Legal Issues Presented

1. Whether the product produced by the Appellant's two-stage mechanical process constitutes mechanically separated meat (MSM) under paragraph 1.14 of Annex I to Regulation (EC) No 853/2004 or is instead a meat preparation under paragraph 1.15.
2. Whether the Food Standards Agency's decision to impose a moratorium on the production of desinewed meat from ruminant bones was lawful, including issues of interpretation of EU law and procedural fairness.
3. Whether the European Commission had the power to impose safeguard measures against the United Kingdom pursuant to Article 56 of Regulation (EC) No 882/2004 in the absence of a demonstrated widespread risk to human health.
4. Whether the Appellant had a legitimate expectation that the FSA would maintain its previous classification of desinewed meat without imposing the moratorium or consulting the industry.
5. Whether the moratorium and related decisions complied with the principles of natural justice and proportionality.
6. The extent to which the duty of sincere cooperation under Article 4(3) of the Treaty on European Union was breached by the FSA or Commission.

Arguments of the Parties

Appellant's Arguments

• The product emerging from the Appellant's process retains recognizable muscle fibre structure and is visually and structurally distinct from MSM produced by high-pressure crushing methods.
• The definitions in Regulation (EC) No 853/2004 should be interpreted to require a significant loss or modification of muscle fibre structure before a product is classified as MSM.
• The FSA's adoption of the Commission's stricter interpretation was an error of law and breached the Appellant's legitimate expectation and rights to natural justice, as there was no proper consultation or opportunity to respond to evidence.
• The moratorium imposed is disproportionate and was based on a preliminary assessment without scientific analysis, causing severe financial harm to the Appellant's business.
• The Appellant's process does not meet the first criterion of the MSM definition because the bones involved still bear substantial meat and thus have not been "boned" as required.
• The Commission lacks power to impose safeguard measures under Article 56 of Regulation (EC) No 882/2004 absent a widespread risk to human health.
• The Appellant seeks interim relief to lift or relax the moratorium, at least for production from non-ruminant animals, pending the Court of Justice's ruling.

Respondent's Arguments

• The FSA must apply the law as interpreted by the European Commission and cannot disregard the Commission's view that any loss or modification of muscle fibre structure, however slight, results in classification as MSM.
• The moratorium was lawfully imposed to comply with EU regulation and to protect public health, especially concerning ruminant bones and potential transmissible spongiform encephalopathies (TSE) risks.
• The Appellant had no legitimate expectation of continued classification of DSM as a meat preparation if the law required otherwise.
• There was no breach of natural justice as the FSA acted within its regulatory duties and the Appellant's claims about procedural unfairness are unfounded.
• The moratorium is proportionate given the public health concerns and the Commission's audit findings.
• The duty of sincere cooperation requires Member States and their agencies to implement EU law correctly, including the FSA's actions.

Table of Precedents Cited

Court's Reasoning and Analysis

The Court began by acknowledging that the principal question of interpretation of the relevant EU Regulation (EC) No 853/2004 had been referred to the Court of Justice of the European Union and thus could not be determined by the national court at this stage. Consequently, many of the Appellant's substantive claims dependent on that interpretation could not be resolved until the preliminary ruling was received.

The Court examined the competing interpretations of the definitions of MSM and meat preparations, noting the Commission's strict approach that any loss or modification of muscle fibre structure results in MSM classification, and the Appellant's more nuanced position requiring significant modification to exclude classification as MSM.

The Court considered the evidence, including expert witness statements and the FVO audit report, which highlighted differences in interpretation between the UK authorities and the Commission. The Commission and FVO maintained that any visible modification under microscopy sufficed for MSM classification, whereas the Appellant and UK authorities argued that the product retained sufficient muscle fibre structure to be classified as a meat preparation.

Regarding interim relief, the Court applied the American Cyanamid test and recognized that the Appellant had a strong case on the interpretation issue and that damages would not be an adequate remedy given the financial impact. The primary contested issue was the balance of convenience, particularly the public interest in enforcing EU law and safeguarding public health.

The Court observed that while the risk to public health from DSM produced from ruminant bones appeared very low, public perception and the precautionary principle warranted caution. Therefore, the Court declined to grant interim relief permitting production of DSM from ruminant bones pending the Court of Justice's ruling.

However, the Court found that the balance of convenience favored the Appellant in relation to DSM produced from pork and poultry, where there was no public health risk and the issue was principally one of labelling. The Court granted interim relief allowing the Appellant to continue production and sale of DSM from these sources, subject to compliance with hygiene regulations.

The Court also allowed the Appellant to sell 51 tonnes of frozen desinewed lamb meat for pet food consumption only, reflecting a compromise consistent with the moratorium's terms and the evidence.

The Court rejected the Appellant's proposed amendment challenging the definition of "flesh bearing bones after boning" on the basis that it led to illogical results inconsistent with the regulation's purpose.

The Court emphasized that the Appellant bore the burden of showing special reasons justifying interim relief, given the public interest in enforcing EU law and protecting public health, as articulated in Factortame and related authorities.

Holding and Implications

The Court GRANTED INTERIM RELIEF with the following key outcomes:

• The moratorium imposed by the FSA on 4 April 2012 remains in force with respect to the production of desinewed meat from ruminant bones; the Appellant is not permitted to produce such DSM pending the Court of Justice's ruling.
• The Appellant may sell the existing 51 tonnes of frozen desinewed lamb meat held in storage as a meat preparation for pet food consumption by cats and dogs only.
• The Appellant may continue to produce and sell desinewed meat from pork and poultry as a meat preparation, subject to compliance with applicable hygiene requirements, and the FSA is restrained from enforcing the moratorium to the extent that it would prohibit this activity.

The Court directed that the European Commission be permitted to intervene and make submissions on the relief granted within a specified timeframe, after which the relief will take effect unless the Commission objects.

The decision preserves the status quo pending resolution of the key interpretative questions by the Court of Justice of the European Union and balances the Appellant's commercial interests with public health and regulatory concerns. No definitive ruling was made on the substantive legal interpretation or the broader claims, and the judgment does not establish new precedent beyond the grant of interim relief in these circumstances.