Delhi HC sets aside FSSAI order against Red Bull over ‘energy drink’ label

The Delhi High Court on Tuesday set aside a Food Safety and Standards Authority of India (FSSAI) order directing Austrian beverage maker Red Bull to discontinue the use of the descriptor “Energy Drink” on its products, holding that the company was not given an opportunity to respond before the order was issued.

Justice Amit Mahajan allowed Red Bull’s petition on the limited ground of violation of principles of natural justice. The court, however, did not decide the broader question of whether the “Energy Drink” descriptor complies with India’s food regulations. FSSAI has been permitted to issue a fresh order after giving Red Bull an opportunity to be heard.

Court flags lack of prior notice to Red Bull

The dispute arose after FSSAI directed Red Bull to stop using “Energy Drink” for its range of caffeinated beverages. Red Bull challenged the June 30 order before the Delhi High Court, arguing that it had been issued without a show-cause notice or an opportunity to present its case.

During Monday’s hearing, the court had specifically asked FSSAI whether Red Bull had been given notice before the direction was issued. Justice Mahajan questioned whether there was any urgency that justified action without first hearing the company, observing that there was “nothing emergent in it”.

Red Bull has also challenged a July 17 communication from FSSAI asking food safety officers across states and Union territories to take action against allegedly non-compliant products. The company claimed that the communication resulted in enforcement measures, including the seizure of its products at multiple locations across India.

Red Bull told the court that its products have been sold in India since 2002 using the “Energy Drink” descriptor. It argued that the latest direction marked a reversal of FSSAI’s earlier regulatory position.

The company cited a March 2024 FSSAI advisory which, according to its petition, had clarified that the expression “Energy Drink” was permissible for products licensed under the relevant food categories applicable to caffeinated beverages. It also referred to an April 2024 Union Health Ministry press release, as well as licences, import clearances and no-objection certificates granted over the years for Red Bull products carrying the same descriptor.

FSSAI says ‘energy drink’ has no prescribed standard

FSSAI’s position is that there are currently no prescribed Indian standards for products marketed as “energy drinks”. Such products are instead regulated as caffeinated beverages, according to the regulator, and the use of the “Energy Drink” descriptor therefore breaches the applicable regulations.

In July, FSSAI privately gave beverage companies 90 days to remove “Energy Drink” or similar descriptions from high-caffeine beverages. The companies affected included PepsiCo, Red Bull, Monster Beverage, Reliance and Hell Energy.

The regulator has argued that the term could mislead consumers because, in many such beverages, the primary source of energy is added sugar and high caffeine content. FSSAI has also said food labels must not create a misleading impression about a product’s benefits.

The food safety authority has raised concerns about promotional claims including “vitalises body and mind” and “helps in general weakness”, saying such messaging could give consumers a misleading impression about the products.

A government source said FSSAI would defend its decision in court against Red Bull.

Industry faces labelling uncertainty

The regulatory move has also created uncertainty for beverage companies dealing with existing stocks and product packaging. In July, a source from a leading beverage company told NDTV Food that manufacturing of new products had been stopped, while companies were struggling to clear existing inventory.

According to the source, smaller distributors were still purchasing limited quantities for sale through dhabas, roadside stalls and kiosks. Larger distributors supplying supermarkets and retail chains, however, had become reluctant to stock products that could soon require label changes, creating a bottleneck in moving existing inventory.

Red Bull has similarly argued that the regulatory action was issued without prior notice and has created uncertainty around its existing and planned investments in India. Reuters reported that the company described the sudden prohibition as affecting its business plans and investment decisions.

The case is the first legal challenge to FSSAI’s move against the “Energy Drink” descriptor. The wider regulatory action has affected other major beverage companies, including PepsiCo, Monster Beverage and Reliance, although Red Bull is the company that pursued the matter before the Delhi High Court.

The High Court’s latest order sets aside the June 30 direction against Red Bull for now, but leaves FSSAI free to reconsider the matter after following the required process and giving the company an opportunity to respond.