Island belatedly prepares to adopt Europe-wide standards on what beneficial claims can be made about products
A £100m trade in mail-order vitamins and health supplements that has sprung up in Guernsey is facing a regulatory crackdown as the island belatedly responds to UK pressure and prepares to adopt Europe-wide standards on what beneficial claims can be made about such products.
British-based rivals claim few British customers know that, unlike in the UK, there are no laws to regulate food supplements, nutritional information or health claims on the island. The UK's Department of Health raised concerns as early as 2007 over the treatment of medicinal assertions in mail-order catalogues emanating from Guernsey's supplements industry.
Some Channel Islands firms have been using catalogues sent to the UK to promote products they allege are good for cancer, dementia, coronary heart disease, cardiovascular disease, Alzheimer's, strokes and diabetes.
Guernsey's health minister, Hunter Adam, instructed officials to start drawing up legislation to comply with European standards more than a year ago. A spokesman told the Guardian this remained a "high priority" and would be brought before parliament "at the earliest opportunity". Adam has told his fellow parliamentary deputies the delay was having an "adverse effect on the reputation of the States of Guernsey".
The most successful supplements firm on the islands is Healthspan, founded by a former Unilever marketing man Derek Coates. Like most of its competitors, Healthspan is largely focused on selling into the UK. In fact, Coates claims to sell more pills and capsules to UK customers than Boots – though the claim is hard to verify.
Healthspan is among several Channel Islands firms found to have breached UK Advertising Standards Authority (ASA) rules in its brochures on a handful of occasions in the past, though Coates says the company now leads the industry across a range of regulatory standards. He claims past marketing material has been no more aggressive than that of UK firms and that today the firm's record is exemplary.
While Coates says Healthspan's high standards already put it well within the bounds of proposed new rules, he has little regard for those who set such standards, particularly in the UK. "The lack of awareness of nutrition in our [sic] country is a crime," he says, speaking to the Guardian. "The poor consumer is left in a complete state of ignorance. No one can admit that the food and the diet that we are now serving our [sic] nation is nutritionally bereft."
Coates is damning too of the ASA, which he says is "lagging behind the curve of knowledge". Asked about a past ASA complaint upheld against Healthspan's promotion of Omega 3 – suggested in one brochure to boost brain function in schoolchildren – he said: "They're not nutritionists who make these rulings. They don't know."
A fervent advocate of dietary supplements, the 64-year-old Coates says his personal focus on nutrition came in large part after he was diagnosed with cancer aged 32 and given six months to live. While he is an evangelist for supplements, he does not profess to be an expert, recruiting a roster of GPs and nutritionists to write for his catalogues, lending their authority to the publications.
Moving to Guernsey after selling his stake in a west London advertising agency, Coates's success in supplements has delivered him a second fortune and made him one of Guernsey's most prominent business leaders. He has gone on to invest in local hotels and a small airline, Blue Islands.
After Healthspan, the second-largest operator in the sector in Guernsey is thought to be Simply Supplements, the owners of which remain anonymous behind a Jersey trust. It too has been accused of making unsupported claims.
Three years ago a Simply Supplements mail-order catalogue was sent to UK customers claiming: "Clinical trials have shown that supplementing Ginkgo Biloba can reverse the decline in cognitive function that often accompanies ageing."
The same brochure claimed: "Our natural ginger supplement offers an effective and safe means of treating joint pain and stiffness without the side effects associated with conventional pain killers" and: "Clinical studies have provided preliminary evidence that Feverfew may be able to prevent both the frequency and severity of migraines."
These and other claims were taken to the ASA, which upheld all but one count on the complaint. Asked to respond to the most serious allegation – that the brochure made medicinal claims for products not licensed as medicines in the UK – Simply Supplements told the ASA it was a Guernsey company and that the UK's Medicines and Healthcare Products Regulatory Agency (MHRA), which is part of the Department of Health, had no jurisdiction in the Channel Islands.
A spokeswoman for the company told the Guardian it had since complied with an ASA order not to reprint the Simply Supplements catalogue in that form. She said Simply Supplements maintained industry-leading standards.
While supplement firms contacted by the Guardian all said compliance with tougher European laws would have no impact on their business, the long-awaited changes have attracted considerable local resistance.
Last year, a petition signed by 2,000 islanders – almost 5% of the adult population – was presented to the health minister, its signatories protesting at his attempts to bring forward legislation to toughen up rules on health claims.
A spokesperson for Guernsey said that ministers were committed to introducing the new rules and officials were busy drafting the legislation. Part of the reason for a delay was because ministers wanted to co-ordinate the introduction of new rules with Jersey "in order to reduce the risk of business migration between the two islands".
In a statement, the spokesperson added: "The drafting of this legislation remains a high priority; however, there are a number of technical matters that need to be addressed before the legislation can be brought before the island's parliament.
"While some members of the community and certain sections of the industry opposed the law, there was not significant commercial resistance; rather, there was an expectation that the legislation would be introduced and recognition, certainly among the larger players, that if industry wanted to continue to sell their products in the UK and EU, they would need to ensure they complied with the regulations."