Review of the effectiveness and validity of operations of the MAIF Agreement:Research Paper

4 Assessment of the international and Australian environments

Page last updated: 18 June 2012

In undertaking the Review, Nous completed an assessment of the international and Australian environments relevant to the MAIF Agreement. Nous identified a number of key findings in relation to the international, marketing and Australian regulatory environments respectively.

These key findings are summarised below.

Key findings from the assessment of the international and Australian environments

Review component (and key findings)

What are the approaches to the regulation of infant formula in other countries1 ?
  • The extent to which the WHO Code has been implemented varies across the nine countries studied and the mechanisms utilised also vary: Australia and New Zealand have voluntary industry codes whilst a number of other countries have enacted legislation.
  • In the evidence considered by the Review, no direct correlation has been established between the level of regulation of infant formula (or implementation of the WHO Code) and the level of breastfeeding in any given country. Rather, based on the evidence reviewed, the breastfeeding rate in those countries investigated were determined to be contingent on many additional factors.
  • The importance of an independent panel and a robust complaints handling process are reinforced by models operating successfully in other countries.
What are the characteristics of the Australian marketing environment now and in the future that might potentially affect the effectiveness of the MAIF Agreement?
  • Consumer expectations towards product quality, protection and disclosure have increased significantly, with commensurate expectations for a timely response to complaints.
  • Changes in technology have led to new media of electronic marketing (e.g. social media) and enable direct, personalised marketing approaches that are not explicitly covered in the MAIF Agreement.
  • Brand line extension strategies enable manufacturers to use the marketing of toddler milk drinks (Stage 3) as de-facto advertising for follow-up formula (Stage 2) and infant formula (Stage 1).
  • Global e-commerce presents significant challenges to the MAIF Agreement as international manufacturers are now able to market their products online in Australia.
What are the characteristics of the Australian regulatory environment now and in the future that might potentially affect the effectiveness of the MAIF Agreement?
  • The voluntary self-regulatory form of the MAIF Agreement is both complementary to other Australian regulatory frameworks, and appropriate to regulate marketing of infant formula within Australia.
  • Although there have been changes in regulatory thinking since the inception of the MAIF Agreement, these changes have not adversely impacted its effectiveness.
  • No significant future developments in economic regulation were identified as having an impact on the operation of the MAIF Agreement. However, the trend towards deregulation and reducing compliance costs was acknowledged.
The remainder of this section provides more detail on the assessment of the international and Australian environments. It includes a comparison of how other countries have implemented the WHO Code, including lessons learnt from the success of those various approaches. It also examines how changes in marketing practices have affected the MAIF Agreement, and how the use of emerging technologies and other marketing practices continues to challenge its effectiveness. Finally, it examines the regulatory environment and the tools available to policy makers to effect regulation.

1 The Review considered the relevant aspects of the comprehensive international comparison study completed by the University of Sydney NHMRC Clinical Trials Centre into the implementation of the WHO Code and other breastfeeding initiatives (University of Sydney 2011) in making its findings and developing recommendations.