China began its efforts at food safety regulatory reform in 2015 with the enactment of a significant revision to the Food Safety Law (FSL).  Now, it has deepened that reform with some of the first proposed implementing regulations for the FSL.  Specifically, the China Food and Drug Administration (CFDA) has proposed, among others, new draft regulations on the licensing of food manufacturers and distributors, including restaurants and other retail establishments.  CFDA appears to be aiming to raise the barriers to entry to the market for facilities that process and sell food.  The comment period on the distribution regulations ended in early July 2015 and the comment period for the manufacturing regulations will end at the end of July.
Food facility manufacturing licenses have existed for some time now.  The current set of regulations on the subject was issued by the General Administration for Quality Supervision Inspection and Quarantine, which was the agency with primary authority over the supervision of food manufacturing.  In 2013, CFDA was given more responsibility over food manufacturing, and these new proposed regulations will cement its authority in this area.  General food, health food, and special medical use food manufacturers will have to obtain a facility license and show that they have the personnel, facilities, disinfectants, and procedures to manufacture safe products.  This includes documentation of a food safety management system, which is an intriguing and undefined concept in the current draft.  They will also have to show compliance with relevant standards governing manufacturing — which have many of the same provisions that one might expect to find in good manufacturing practices — and to pass site inspections with detailed proposed requirements and sample tests.
Similar with distributors.  Under those proposed regulations, every establishment that sells food or performs restaurant services, with the exception of small local, traditional street vendors, will have to obtain a food distribution license.  To do so, they will have to show that they too have the requisite facilities and personnel in place to ensure food safety and possibly submit to an inspection.
These proposed changes to the system seem like they have great potential, and in many respects they do.  If implemented properly, these licenses could be important markers of safety in China’s complex supply chains.  Distributors should only buy from other manufacturers or distributors with the proper license, which they can hopefully review through CFDA’s online database of licensure information.  The traceability that comes with licensure could facilitate recalls and help root out counterfeiters.  The distribution licensure system could also help China promote better storage and good supply practices, perhaps resolving significant shortages in cold storage and other necessary food preservation technology.
At the same time, manufacturing and distribution license systems have existed for drugs and medical devices for years now in China.  Yet, those systems have not always been at the core of promoting greater quality and traceability, and instead have, at times, been sources of burdens and complaints.  Regulators in those spaces have begun to focus more on post-marketing surveillance and supervision, rather than pre-approvals.  In the medical device space, for example, the State Council (China’s chief executive body) and CFDA recently removed distribution license requirements for certain classes of devices.  So, in some ways, this sheds doubt on whether more can be achieved with food.
China should make sure that CFDA and the food and drug regulatory authorities in the provinces and municipalities have the resources (for example, internal expertise and training) necessary to review applications for evidence of proper compliance and keeping bad actors out of the system.  CFDA should also provide clear guidance to stakeholders regarding the food safety management systems that will be required.  In the end, success will depend on whether regulators can make the licensure systems a meaningful source of larger voluntary compliance for small and large stakeholders and not an administrative burden.