A series of drafts for comments of laws and regulations have been released by relevant government authorities recently and we prepared a series of "brief" on these topics.
This article is on the "Administrative Measures for Food Business Licensing(draft for comments)" (abbr. Draft for Comments) released by State Administration for Market Regulation (SAMR) on August 6th, 2020.
Rules in Draft for Comments not only improve the operation environments of food operators but also impose heavier penalty. It also affects the application of food operation licenses and operation model. Here below are the highlights we summarized.
Reminder: deadline of suggestion and comments collection is September 6th, 2020.
Conditions that food operation licensing is NOT required
- Food producer that already got food production license sells food products on its production site or via internet.
- Selling edible agricultural products.
- Catering service operator opens affiliated stores, such as dessert station, near its main store and all the food products are supplied by the main store and the affiliated store sells the food directly with no further processing.
- Food operator that already got food production and operation license sells its food products in temporary trading places such as exhibition, trade fair, expositions, etc.
- Medical institutions and drug retailers sell special total nutrition formula food in the special medical purpose formula food products.
- Other conditions that food operation licensing is not required stipulated by law and regulations.
Source: Picture from Baidu
Principle"One site One license"
Exception to principle "One site One license" is stipulated that principle "One site One license" is not applicable to food operation using automatic equipment.
Food operation using automatic equipment should submit documents, such as qualification certificate of automatic equipment, specified location of each equipment, way of demonstration of food operation license, food safety risk control system, etc.
Electronization of license
Informatization construction of food operation licensing is being promoted and following practices will be gradually implemented:
- online processing of license application, acceptance, examination, issuing and inquiry;
- issuing of digital certificate of food operation license;
- publicizing food operation license items and food operation license data on official website for public inquiry.
Food operation license information should be recorded under the name of food operator and publicized by National Enterprise Credit Information Publicity System.
Same as the electronization of business license, digital certificate of food operation license issued by market regulation departments is of same legal validity as printed food operation license.
Source: Shanghai Municipal Government "All-in-one Network" (????)
No multiple choice for Main Type of Operation
Main type of operation can be divided into food selling operator, catering service operator, staff canteen. No multiple choice for main type operation.
Food operator doing business or wholesales through automatic equipment should make remarks in the brackets after main type of operation.
Central kitchen, delivery unit of group meal, catering service management company should be listed in the brackets after main type of operation.
Catering service provider that opens affiliated stores, such as dessert station, should list names and addresses of all its affiliated stores in the brackets after main type of operation.
Adjustment of Operation Items
Operation items can be divided into pre-packaged food sales (refrigerated food and frozen food included), bulk food sales (refrigerated food and frozen food included), special food sales (health food, special medical purpose formula food, infant/children formula milk powder, other infant/children formula food), semi-finished food production and sales, hot food production and sales, cold food production and sales, eaten-raw food production and sales.
Bulk cooked food sales are divided in bulk food sales, cold processed cake and pastry production and sales; and fresh squeezed vegetable/fruit juice production and sales in cold food production and sales should be listed in the brackets after type of operation.
If only simple practice of operation and sales, such as simple heating, unsealing, placing in a plate, seasoning, are included in hot food, cold food, eaten-raw food production and sales, remarks "simple production and sales" should be listed in the brackets after type of operation.
The Draft for Comments deleted "refrigerated food and frozen food not included" in pre-packaged food sales and bulk food sales. Semi-finished food product operation and sales was added. Cake and pastry production and sales and homemade beverage production and sales are deleted and added to hot food and cold food production and sales.
Other kind of food production and sales is deleted, and the scope of food production and sales are expanded.
Catering service provider and staff canteen that already obtained license on operation projects of food production and sales can carry out operation projects of pre-packaged food sales directly and no need to apply licensing for it.
Electronic Signature is acceptable
Applicant should honestly submit relevant documents and report facts to market regulation departments and be responsible for the authenticity of application materials. Applicant should sign or stamp on the documents such as application forms and electronic signature is acceptable. Such practice can greatly reduce the trouble and time used to find proper person to sign.
Acceptance of application
Acceptance notification should be issued if market regulation department decided to accept the applicant's application.
Acceptance notification is NOT needed if license can be approved and issued on the spot. If application is rejected, notification of rejection should be issued.
Reason of rejection should be listed on the notification of rejection and applicant should be notified the right of applying for administrative reconsideration or bringing administrative litigation. Procedure of license application is stipulated in this clause.
Notification Commitment System
For following food operation licensing, notification commitment system should be imposed, administrative licensing decision should be made on the spot and implementation scope of commitment system should be notified:
- new license application only on pre-packaged food sales;
- application of license renewal (limited to no change on operation condition, deduction or no change of operation projects);
- application of license extension (limited to no change on operation condition, deduction or no change of operation projects).
For food operator that obtained food operation license through notification commitment, county level and above local marketing regulation departments should carry out supervision and examination within 30 days after the applicant obtained food operation license.
The examination should focus on whether the operation realities is consistent with commitment, whether the food operation situation conforms to the food safety requirement, etc. Under the premise of ensuring food safety, extending scope of notification commitment system on low risk food operator should be explored.
Original stipulation "On-site audit can be exempted for application only for pre-packaged food sales (refrigerated food and frozen food not included) and food operation license renewal with no change on facility nor layout" is revised to notification commitment system.
Compressing time limit
Inspectors should complete on-site examination of the operation site within 5 working days upon receipt of on-site examination assignment. The time limit was compressed from 10 days to 5 days.
Decision should be made whether the administrative licensing is approved or not within 10 working days upon receipt of application. If the time limit needs to be extended due to special reasons, time limit can be extended for 5 working days with approval from head of relevant authorities.
So, the regular time limit was compressed from 20 working days to 10 working days and time limit of extension was compressed from 10 working days to 5 working days.
Simplification of content specified in license
Food operation license should specify:
- name of operator;
- unified social credit code;
- legal representative (person in charge):
- operation site;
- main type of operation;
- operation projects;
- license code;
- period of validity;
- telephone number of complaint reporting;
- issuing authorities;
- issuing date and QR code.
Following content are deleted:
- daily supervision and management authorities;
- daily supervision and management staff;
- signer of license;
- ID number of self-employed operators.
Display of electronic license
In prefecture where food operation licensing electronic certificate management is promoted, food operator can display the original food operation license printed by itself or display in electronic form.
Food operation carried out by automatic equipment, photocopy of food operation license and contact information should be posted on prominent position of the automatic equipment.
Affiliated stores, such as dessert station, should display photocopy of main store's food operation license and contact information on prominent position.
Timely renewal and extension
When License items change, food operator should submit license renewal application timely to the market regulation department which issued original license. Time limit changed from 10 days to timely, supervision is strengthened.
New stipulations were added that food operator should report to the market regulation department which issued original license within 10 days after following changes happened:
- important changes on main equipment facility layout and operation process;
- change of offsite warehouse address;
- change or adding of location of automatic equipment.
For extension of period of validity of legally obtained food operation license, application should be submitted to the market regulation department which issued original license 20 working days before the expiry date of original license. Time limit changed from 30 working days to 20 working days.
Operation beyond permitted scope
New stipulation was added that following operation without permission will be penalized according to Food Safety Law of P.R.C Clause 122:
- operation beyond permitted scope of operation or main type of operation;
- conducting food operation beyond period of validity of license; or
- changing operation site without applying for license renewal as per required.
Expertise required to judge operation beyond permitted scope!
Market regulation department which issued original license can revoke the administrative licensing and impose administrative penalties according to Administrative Licensing Law of P.R.C Clause 69, 78 and 79, and impose fine on the relevant legal representative, main person in charge, direct liable executives and other directly liable person according to the Implementing Regulations of Food Safety Law Clause 75:
- license applicant concealed fact and provided false information to apply for food license;
- licensee obtained the food operation license through cheating, offering bribe or other illegal method.
New stipulation was added that fine will be imposed on relevant legal representative, main person in charge, direct liable executives and other directly liable person.
County level or above local market regulation departments should command correction, give warning and impose a fine (over RMB10,000 but below RMB30,000) on food operator who forged, altered, sold, leased, lent or illegally transferred its food operation license in other ways. Those who committed crime will be handed over to the police.
"Illegally transferred in other ways" was added, so, the scope of illegal transfer is expanded.
Definition of "Central kitchen"
Central kitchen is a kind of catering service provider set up by food operator with independent site, equipment and facilities, which centralize finished food production or semi-finished product processing and deliver to its own chain stores for further processing and then offer to consumers.
Food product can only be delivered to its own chain stores. It will violate the regulation if delivered to other units. Companies running central kitchen, please pay attention to the compliance of your central kitchen!
Special medical purpose food
Specific total nutrition formula food in special medical purpose formula food should be sold to consumer through medical institutions or drug retailers.
Based on above comparison between current "Administrative Measures for Food Operation Licensing" and the new "Draft for Comments", we can find that market regulation authorities adopted a more open and tolerant attitude towards the development and innovation of food industry and the supervision focused more on details in a timely manner.
We will follow up the revision progress closely and keep you updated.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.