By John D. Stoll, Mike Esterl and Frances Robinson
Lithuania's parliament on Thursday voted overwhelmingly to ban
the sale of high-caffeine energy drinks to minors--a move that
could renew scrutiny of products like Red Bull and Monster
elsewhere.
The small Baltic nation said it is the first country to take
concrete action to ban sales to minors. "We hope that some
countries of the EU that don't have a clear position will follow
the Lithuanian way," Almantas Kranauskas, a health ministry
official, said in an interview.
The move could embolden advocates of energy-drink legislation,
who say young people tend to gravitate toward the drinks. A study
commissioned in 2013 by the European Food Safety Authority found
that adolescents were by far more prone to consume energy drinks
than adults, with 68% of European youths aged 10 to 18 years old
drinking them.
The European Commission has expressed concern about the health
risks of such drinks, and they have drawn scrutiny from regulators
in both the 28-member European Union and the U.S. The U.K. will
soon require companies to label drinks with more than 150
milligrams per liter of caffeine, and German consumer protection
agencies have called for tighter controls on energy drinks.
It isn't clear how much of a precedent the move by Lithuania,
which has a population of only 3 million, will set. Attempts to
prohibit sales to minors have generally fallen flat in larger
markets. Lawmakers in Maryland, for instance, introduced a bill in
February proposing a ban on youth sales, but a committee voted it
down in March. Similar efforts in Chicago have failed to take hold.
Lawmakers in New York state's Suffolk County last year prohibited
the sale of energy drinks to minors--but only in county parks.
The stakes are high for makers of energy drinks, which is one of
the fastest-growing beverage categories. Global energy-drink sales
have grown more than fourfold over the past decade and rose 6.8% to
$27.53 billion in 2013, according to market research firm
Euromonitor. Austria's Red Bull GmbH has a 31.5% global market
share, followed by California-based Monster Beverage Corp., with
14%, according to the data service.
Lithuania's legislation targets drinks that contain 150
milligrams of caffeine per liter, and drinks containing certain
other stimulants. Not only is the direct sale of these drinks to
minors prohibited under the new law, but buying the drinks for them
is also illegal. The ban is likely to dent a small but rapidly
growing industry: sales of the top-selling energy drinks and sports
drinks in the nation rose 37% between 2011 and 2013 to $20.6
million, according to Euromonitor.
A spokesman for the EU's health commissioner said the commission
doesn't comment on laws being adopted by member states.
Energy drink makers have argued they are unfairly targeted. They
say they don't market to children and that their products typically
contain about 10 milligrams of caffeine per ounce, or half that of
a Starbucks coffee. They also cite studies showing children get
most of their caffeine from soda, coffee and tea, not energy
drinks.
Officials with Red Bull couldn't be reached for comment.
Carlsberg A/S, which sells Battery Energy Drink in Lithuania, and
Monster said they couldn't provide immediate comment.
Coca-Cola Co., which sells a brand called Burn in Lithuania,
referred comment to the Union of European Beverage Associations.
The industry group declined to comment directly on Lithuania's
move, saying only that energy drinks have the same amount of
caffeine as coffee and that European energy-drink makers recommend
on packaging that children don't drink their products.
Facing regulatory challenges in the past, companies such as
Monster have reformulated drinks in order to meet regulatory
thresholds. It is a costly method that manufacturers could employ
if bans were to become more widespread, said Howard Telford, a
beverage analyst with Euromonitor.
Energy drink companies have faced heightened scrutiny in the
U.S. since 2012, when New York state Attorney General Eric
Schneiderman launched a probe into their marketing and health
claims and the Food and Drug Administration disclosed it was
investigating whether energy drinks "may pose significant risks" if
consumed in excess or by "vulnerable groups" including young people
or those with pre-existing cardiac conditions. The companies at the
time reiterated that their products are safe.
Companies including Red Bull and Monster, which dominate the
roughly $10 billion in annual U.S. energy drink sales, faced a
questioning last summer by the Senate Commerce Committee over
allegations they were targeting youth.
The American Academy of Pediatrics says energy drinks "have no
place in the diet of children and adolescents" and the American
Medical Association supports a ban on marketing such drinks to
children under 18 years of age.
Energy drink makers including Red Bull and Monster have
voluntary warnings on their cans in the U.S. that their products
aren't recommended for children, pregnant women or people sensitive
to caffeine. Coca-Cola cautions on cans that its NOS and Full
Throttle energy drinks aren't recommended for people under 18 years
old.
Mr. Telford, of Euromonitor, said that while the energy-drink
industry operates under the threat of increased regulation, most of
the research on the subject is new. "I think that regulatory
agencies are going to look at this more seriously," he said.
Monica Houston-Waesch and Clemens Bomsdorf contributed to this
article.
Write to John D. Stoll at john.stoll@wsj.com, Mike Esterl at
mike.esterl@wsj.com and Frances Robinson at
frances.robinson@wsj.com
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