More Safety, Quality and Fair Competition in the Fruit Juice Sector

1. More Safety, Quality and Fair Competition in the Fruit Juice Sector through Industrial Self Control Martin Greeve Project Manager - SGF/QUISEE Vice President - EQCS SGF/IRMA Regional Conference Poland Tuesday, December 12, 2006 Warsaw Marriott Hotel

2. Shared Responsibility for Ensuring Quality and Safety for Consumers 5 main Quality Assurance and Control Pillars • Producers’ Quality Managements (QM) • Distributors / Retailers Purchasers and QM • Industrial Auto- or Self Control of Sector • State Food Controls • Consumer Organisations / Consumer Magazines 2

3. Who is SGF INTERNATIONAL E. V. ? • Sure – Global - Fair • Biggest and one of main players of EQCS • Non governmental organisation (NGO) • Non profit organisation • International industry association with direct company memberships • Registered in Eurocity Frankfurt/Main / District Court • Budget covered by member contributions • Democratic structures and decision procedures • Quality control body of industry - no normative function

4. Facts and Figures • Foundation 1974 • Market & Packer Controls in 14 countries of EU • Raw material & Supplier Controls in > 50 countries • Companies to be audited p.a. - packers, bottlers (31.12.2005) 117 - traders, brokers (31.12.2005) 36 - RM suppliers (31.12.2005) 393 • Number of audits/plant inspections 612 • Sample Through Put 5733 • Number of co-workers 26 • Number of corrective actions - internal 670 - external 0 • Budget / regular control work 2005 2.6 Mio € • Extra budget / QUISEE 2005 0,3 Mio €

5. SGF-Structure Pillars of SGF- Control Work SGF INTERNATIONAL E. V. Sure - Global - Fair Voluntary Control System (VCS) Bottler and Market Controls in Baltic States, Czech Republic, Denmark, Germany, Austria, Hungary, Ireland and Sweden Raw Material- Producer and RM-Supplier Controls in about 52 countries world-wide RQCS IRMA 5

6. Where is industrial Self Control in Europe Market and Packer Controls SGF/RQCS Countries SGF/QUISEE Countries(only market controls) NQCS Countries EQCS Countries with QUISEE support

7. Who is Industrial Self Control in the European Fruit Juice Industry ? European Quality Control System (EQCS) SGF/RQCS NQCS SGF/QUISEE SGF/IRMA 5 national control schemes in France, Netherlands, Poland, Spain and United Kingdom International Market and packer controls in 14 countries on behalf of 10 national Associations Austria, Czech Republic, Denmark, Estonia, Germany, Hungary, Ireland, Latvia, Lithunia, Sweden Market controls in 11 non EQCS countries / support for Spanish and Polish control schemes Belgium, Bulgaria, Cyprus, Finland, Greece, Italy, Malta, Portugal, Romania, Slovakia Slovenia Raw Material and supplier controls in > 50 countries world wide 7

8. SGF/IRMA Raw Material Assurance and Supplier Control Israel Italy Ivory Coast Kenya Malaysia Mexico Paraguay Pakistan Peru Philippines Poland Romania Slovenia South Africa Spain Sweden Switzerland Thailand The Netherlands Turkey Ukraine United States Uruguay Argentina Austria Belgium Belize Brazil Chile China Columbia Costa Rica Cuba Cyprus Czech Republic Denmark Ecuador Finland France Germany Great Britain Greece Guatemala Honduras Hungary India Indonesia Ireland 8

9. Working Principles and Basis of Success Independence (finances, politics) from individual companies and other sector associations High reputation and credibility at experts from science, authorities, retailers, industry and consumer organisations Strict confidentiality for all company related information Equal treatment of all market players in complaint cases Contribution to legal security – to clear what is right or wrong Corrective actions in case of quality deviations and unfair competition Provision of useful services for member companies / added values for membership fee Partnership instead of policing industry To be close to market developments and member problems

10. SGF Scope of Activities Industry Services • Hotline • Info / Early Warning • Contributions to tech. Association Work Market Surveys Packer/Bottler audits & Controls SGF Raw Material / Supplier audits & Controls Databases • Authenticity • Pesticides • GMO Ok-Feedbacks & Corrective Actions Research and Development of New Analytical Methods

11. Analytical Research and Development of New Technical Working Tools and Projects Pure Juice, FLAIR, BCR, ENEA and Research  Coordination international EU-Projects Code of Labelling Raw Materials (IRMA/CoL) Code of Conduct Suppliers (IRMA/CoC) Database Pesticides (FRAPP) Quality Initiative South and East Europe (SGF/QUISEE) Hygiene Audits IRMA-Supplier Regional Specific Database authentic juices Info Services (Hotline, Newsletters, Early Warnings) Standard Questionnaire for Supplier Selection / combined audits for different standards (IRMA, BRC, IFS etc.)

12. SGF Scope of Controls Ethical Business Attitude Safety and Hygiene SGF Authenticity Fair Competition Traceability/Mass balances Labelling

13. Chain of SGF-Control / Audit Points Farmers/Eurepgap Fruit Processors Traders/Brokers Blending Stations/Cool Stores Transport Companies Packers/Bottlers Retailer Shelves

14. Chain of SGF-Control / Audit Points EUREPGAP Farmer level IRMA Fruit Processor level EQCS Bottlers Packer level RETAILERS Consumers

15. Central Services IRMA raw material and supplier control Market controls in non EQCS countries (QUISEE) Development of new analytical methods Expert committee for evaluation EU wide market campaigns Control chain from the tree to the bottle (EUREPGAP – IRMA – EQCS)

16. SGF-Working Procedure Product Controls Sample Taking in Markets & Plant Inspections Laboratory 1 Analysis Laboratory 2 Analysis IRMA/RQCS Board External Corrective Action Secretariat Internal Corrective Action Expert Committee for Analyses Neutral Evaluation Laboratory 3 Analysis Post Control Post Control Post Control OK Feedback Producer OK Feedback Producer OK Feedback Producer OK Feedback Producer OK Feedback Producer O.K. Legend: Not O.K.

17. Not OK Postcontrol Not OK OK OK ! ! EXTERN Info Consumer Organisation / Public ? 6 Formal EU-Infringement Proceeding / Court Cases ? 5 Corrective Steps ? Info Retailer / Authority and Exclusion 4 ? Negative Covenant of Producer Involved 3 INTERN ? Quality Commitment / Acknowledgement of Obligation 2  ? 1 Info Letter / Warning Letter X X X X Detection Quality Defect Clearing Function in the Markets for Quality Problems and unfair Competition Issues Ac-tion 0 First step, if • Quality Defect detected • Depending on the Seriousnessof Infringement Next Step Corrective Action only, if • No Co-operation • Case of Repetition 17

18. Internal Corrective Action

19. Protection against unjustified Attacks and Allegations EU rapid alert 1999, - Allegation Methomyl in Orange Juice / Spain EU rapid alert 2000 - Allegation staph aureus in Orange Juice / Greece Anonymus letter to Industry, media and Authorities 2004 - Allegation Water dilution NfC orange juice / Brazil EU rapid alert 2005 - Allegation 500 ppb Patulin in Apple Nectar / Greece EU rapid alert 2005 - Allegation Patulin in grapefruit juice / Lithuania Retailer Internet Auction 2005 - Product specification deviating from standard excludes serious bids

20. Role of Industrial Self Control Summary Contributions to Consumers‘ Health and Safety • Basic control of standard compliance for producers and trade on all production and trade levels: intersectorial chain control (safety, hygiene, authenticity, labelling) • Up-stream traceability on basis of documentation and counter sample system • Stop quality problems and unfair competition issues at its source to block danger of repetition and further profileration • Protection against unjustified attacks and allegations • Development new analytical approaches and techniques to fight new, high sophisticated adulteration recipes • Cost reduction for member companies using control and audit results as a reference means more flexibility to focus on e.g. safety issues • Safe guarding equal implementation of EU legislation and industry standards • Legal security for all players in the market (producers, traders, retailers) • Involvement of retailers in quality commitments and corrective actions

21. Outlook for Industrial Self Control Offer of central operational services for local control schemes Development of central market and packer controls in Europe Set-up and support of the development of packer and market control schemes in countries outside of Europe (China, Russia, Australia, New Zealand etc.) Offer and use of SGF/IRMA – services by countries outside of Europe Use IRMA synergies for neighbouring industries(fruit preparation~, jam ~, fresh and canned fruit industry etc.) Acknowledgement of industry standards (CoP etc.) as binding rules for all players in the market Recognition of AIJN/CoP and industry standards by authorities, retailers, consumer organisations etc. Closer co-operation with State Food Control Authorities, consumer organisations and retailers to stop any image risks for fruit juice products Subsequent development of concepts of industrial self control to keep pace with changing markets and member needs

22. Consumer Satisfaction by safe, healthy natural and authentic products Industrial Self Control Contributes to 2 sides of the same Coin

23. Fair Competitioninthe Markets By authenticity and correct labelling Industrial Self Control Contributes to 2 sides of the same Coin

24. Consumer Satisfaction by safe, healthy natural and authentic products Industrial Self Control Contributes to 2 sides of the same Coin

25. Fair Competitioninthe Markets By authenticity and correct labelling Industrial Self Control Contributes to 2 sides of the same Coin

26. Consumer Satisfaction by safe, healthy natural and authentic products Industrial Self Control Contributes to 2 sides of the same Coin

27. Fair Competitioninthe Markets By authenticity and correct labelling Industrial Self Control Contributes to 2 sides of the same Coin

28. For more Information Please visit our Websites www.sgf.org or www.eqcs.org Thank you for your attention