The Austrian beverage producer Red Bull has filed a lawsuit against India’s food regulator over a ban on using the term "energy drink" without prior notice; according to court documents, the decision is negatively affecting the company’s current and planned investments in India, UNN reports, citing Reuters.
Details
In June, India ordered producers of beverages with high caffeine content that are sold as "energy drinks" to stop using this term. Authorities rejected attempts to block the regulatory intervention in a rapidly growing market that is projected to reach a value of $1.6 billion by 2028.
The move sparked a conflict, as companies such as Pepsi, Red Bull, Monster Beverage and Reliance (owned by billionaire Mukesh Ambani) feared that abandoning the category could harm brands whose image is built on the promise of an instant energy boost, as well as negatively affect sales, Reuters reports.
In the first lawsuit challenging the decision, Red Bull approached the Delhi High Court on September 25. The petition (which is not public but was reviewed by Reuters) claims that established procedures were violated because the company was not given prior notice.
Red Bull’s Indian subsidiary said that the "sudden ban" on using the term—in the absence of changes to the product standards themselves—"creates significant regulatory uncertainty and negatively affects" the company’s current and planned commercial investments.
In addition
Energy drinks raise concerns among health regulators in many countries around the world because of their high content of caffeine, sugar and taurine (an amino acid). In particular, in England, their sale to people under the age of 16 will be banned from April next year.