- The Delhi High Court set aside FSSAI's order banning Red Bull's "energy drink" label usage
- Red Bull argued the ban conflicted with India's policy to support trade and investment
- The court ruled FSSAI did not give Red Bull a chance to present its views before the order
The Delhi High Court on Tuesday set aside the Food Safety and Standards Authority of India's (FSSAI) order directing Red Bull to stop using the label "energy drink" on its cans.
In its court filing, Red Bull argued that FSSAI's decision went against India's stated policy to facilitate "international trade, promote investment and provide greater certainty to businesses", as the "abrupt prohibition" of the descriptor was issued without any change to the underlying product standard.
Red Bull's India unit further contended that the prohibition of the 'energy drinks' label "introduces substantial regulatory uncertainty and adversely affects" its existing and planned commercial investments.
Agreeing with the company, the Delhi High Court said FSSAI had taken the decision "without affording any opportunity" to Red Bull to present its views.
The FSSAI is set to appeal against the court's decision on public health grounds, a government official with direct knowledge of the plans told Reuters on condition of anonymity. The regulator did not respond to requests for comment.
The High Court's decision comes as a major relief not just for Red Bull but also for other beverage companies, including Pepsi, Monster Beverage and Reliance. All are significant players in India's energy drink market, which is projected to be worth $1.6 billion by 2028, growing at 12.6% annually.
India's energy drink market saw significant growth after Pepsi launched Sting in 2017. Its Rs 20 plastic bottles became particularly popular among 15- to 19-year-olds and in rural areas, according to consumer research firm Euromonitor.
Following FSSAI's order to stop the use of the "energy drinks" category label, beverage companies feared the move would damage their brands.
Also Read: Production Stopped, Stocks Pile Up: Energy Drink Order Leaves Brands Struggling
Why Food Authorities Are Against Energy Drinks
Energy drinks have sparked health concerns among regulators in several countries around the world. Food authorities have warned that such drinks contain significant amounts of caffeine, sugar and taurine, which research suggests may contribute to high blood pressure and heart disease, among other health problems.
