CHINA - The rapid growth of e-commerce in China, and the never ending food safety scandals, tainted or counterfeit products and the lack of consumer confidence in domestic supplies of items such as infant milk formula, has led to a boom in cross border internet sales of food and health supplements. But that may be about to end.
China’s new Food Safety Law (FSL) contains specific provisions to regulate supervision and management of online food operation, the online sales of food products and sets out obligations for both online food operators and third-party platform providers.
Third-party online trading platform providers – e-commerce sites and ISPs (Internet Service Providers) – that allow the sale of food related products must maintain a registry of real-names and identity cards of domestic food operators and specify their food safety responsibilities prior to making them available online.
In the event of a consumer complaint of counterfeiting, substandard or contaminated product, authorities have the power to require the trading platform to reveal the contact details of the original supplier. In the event that the supplier can’t be found, the trading platform or ISP will be held liable.
Cross Border E-commerce
However, since Cross-Border E-Commerce (CBEC) is on the rise, giving Chinese consumers quicker, less restricted and more secure access to overseas food brands and other products, the Chinese government has been promoting CBEC as a means to boost the economy.
As a result, the government has designated a number of cities/areas such as Hangzhou as CBEC Pilot Zones – essentially bonded warehouse zones where food, bought over the internet through third party trading websites, would be imported through these pilot zones, as well as through free trade zones (FTZs), and be subject to less regulation. In this instance the trading site, as the importer, would be responsible for compliance with the FSL.
Although importers would be required to comply with the new food import registration and inspections contained elsewhere in the FSL, to ease the burden on industry, and speed customs clearance, the importer would be able to pre-qualify imported products being routed through a CBEC Pilot Zone.
Track & Trace
The government is now also drafting a regulation targeting foods imported via the CBEC bonded warehouse model to allow the use of electronic track-and-trace labels and, with the exception for certain special foods that require medical advice, a food operator may apply either an electronic or a printed label on the food to be imported via the CBEC bonded warehouse.
Available for free download - the current issue of Packaging Business Insight Asia contains a detailed analysis of China’s Food Safety Law.
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