Food

2019 Compliance Review: Food Regulatory Updates in China

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In the past five years, China ’s retail market has experienced the miracle of digital growth. Social media,  e-commerce, and mobile payments are seamlessly connected. The purchasing decisions of consumers can be driven by KOLs, comments on the third-party platforms and personalized offers supported by big data. PwC's Global Consumer Insights Survey found that 50% of Chinese consumers shop online every week, while 59% of Chinese consumers shop online for groceries (the average global ratio is 21 %). Food enterprises still consider China and the United States as the countries with the largest consumer markets  in the world, with the final revenue of the food industry reliant on consumer spending. Disposable income per capita in China of its overall population of 1.4 billion is on the rise, and the consumer preferences are constantly shifting due to income growth. The impact of technological progress and internationalization in urbanization is constantly changing. Facing China’s huge market, the problems that affect the food industry are over-regulation, policy instability, food safety, food fraud, ineffective crisis management and unreliable supplier management. 3 New Food Ingredients Published On May 29th, 2019, the National Health Commission issued an announcement to adopt Lactobacillus Curvatus, Ashitaba stem and leaf and Loquat flower as new food ingredients. Cancelling the Label Filing for Imported Pre-packaged Food Starting from October 1st, 2019, the inspections system for labels of imported pre-packaged foods was changed to the spot-check system. Importers are responsible for reviewing labels before importation, and the products are not allowed to be imported if they fail the inspection. Necessary certificates, original and translated labels of the imported pre-packaged food, Chinese label samples and other documents certifying the quality and components of the food should be submitted to Customs if required. After customs clearance, if a notification or report were received from relevant governmental departments or consumers on any suspected regulatory violation, importers will be penalized according to law after verification and confirmation. New Implementation Rules of Food Safety Law Published On October 31st, 2019, the new Implementation Rules of Food Safety Law was released. These were later implemented on December 1st, 2019 officially. This revision adheres to the people-centered principle and the "Four Strictest" requirements (strictest standards; strictest supervision; strictest punishment; and strictest accountability) of food safety by strengthening the overall supervision process and increasing the cost of illegal activities. Consulting on Food Label Supervision and Management Measures On November 21st, 2019, the State Administration for Market Regulation publicly published the Measures on Supervision and Management of Food Labeling (Draft), which clearly state that imported foods must bear Chinese labels, which should be directly affixed, printed, or marked on the smallest package unit of the prepackaged food instead of re-affixing. Unless specifically compliant with provisions of relevant laws and regulations and food safety standards, food labels must not indicate or emphasize their specific use or suggested use for infants, children, the elderly, pregnant women and other specific groups of people. Consulting on Registration Management Regulations for Overseas Manufacturers of Imported Foods On November 21st, 2019, GAC publicly solicited opinions on the draft of Registration of Overseas Manufacturers of Imported Foods, with the objective of expanding the registration categories to All Foods (the original categories only covered meat, aquatic products, dairy and edible bird's nest EBN). It requires the registration to be pre-examined and recommended by the authorities of the importing country, and finally verified by customs on site or by remote video. After registration, the registration number, name and address of the manufacturer must be marked on the minimum sales package. Make the Supervision of Health Food clear In 2019, the State Administration for Market Regulation launched a 100-day operation against companies in the "healthcare" market that had created chaos due to their untruthful or misleading labels. Since then, the Guidelines for Labeling Warning Words on Health Foods and Guidelines on how to name Health Foods (2019 Edition) have been successively issued, and opinions have been solicited to adjust sections of Health Properties and Promotion. Implementation Rules of Food Safety Law clearly forbid false publicity of food in lectures, health-related consultations, etc., and require that the contents of health food labels and instructions be consistent with the labels or instructions registered or filed. In the future, regulations and consumer awareness will be more clear. However, there are opportunities for legitimate requests by compliant companies. The release of the Administrative Measures for the Catalogue of Ingredients and the Catalogue of Health Functions of Health Food has opened channels for individuals, enterprises, scientific research institutions and social groups to apply for new health-care functions and apply for the inclusion of an ingredient in the health food ingredient catalogue. Infant Formula Awaits Revision In June 2019, the State Administration for Market Regulation issued the Administrative Measures on Registration of Infant and Young Children Formula Milk Powder Recipes (Draft), which further tightened registration requirements for formulas, further strengthened penalties for violations, and further implemented the requirements of "delivery of administrative services". The measures require the applicant to have a complete production process, clarify 7 cases of non-registration, specify prohibited contents on labels and instructions as well as the requirements for documents submitted for the modification of the application; The Implementation Rules of Food Safety Law clearly stipulates that infant formula supplemented with optional substances specified in national food safety standards shall not be named after the selectively added substances; National Food Safety Standard for Infant Formula, National Food Safety Standard for Larger Infant Formula and National Food Safety Standard for Infant Formula, which released for public comments in 2018, are expected to be launched next year. Categories of Food for Special Medical Purpose Expected to Grow The new Food Safety Regulations specify that specific full nutritional formula foods should be sold to consumers through medical institutions and drug retail enterprises. Medical institutions and drug retail companies can sell specific nutritional formula foods without obtaining the food business license. Advertising is regulated under the advertising requirements for prescription drug. Other special medical foods are regulated according to advertising requirements for over-the-counter drugs; the General Administration of Market Regulation has adjusted and simplified the general names of special medical foods; it is expected that six types of special medical foods will be added in the future. Stopping Malicious Reports against Counterfeits The Interim Measures for Handling Complaints and Reports Concerning Market Supervision and Administration will come into effect on January 1st, 2020. Market supervision and management departments will not accept the reports, if the purchase, use or being serviced is not for normal daily consumption. Market supervision and management departments is aiming at restricting malicious reports. GB 2769-2019, GB 31650-2019 Published The new standard GB2763-2019 was recently issued to replace GB2763-2016 and GB2763.1-2018; the new standard GB2763-2019 specifies 7107 maximum residue limits for 483 pesticides in 356 foods. Additionally, the new standard GB 31650-2019 will replace the corresponding part of the Announcement No. 235 Maximum Residue Limits of Veterinary Drugs in Animal Foods made by the Ministry of Agriculture and Rural Affairs, which stipulates 2191 residue limits and usage requirements for 267 kinds (types) of veterinary drugs in livestock, poultry, aquatic and bee products.

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