Starting from October 1, 2016, both domestic infant formula milk powder (“IF”) producers and foreign IF producers which export IF to China are required to register their IF recipes at the China Food and Drug Administration (“CFDA”). Each IF producer may only register 3 recipe series and up to 9 recipes. A grace period for IF producers to complete the recipe registration will be separately announced by the CFDA. For IF sold via cross-border E-commerce (“CBEC”), the grace period for registration is valid until January 1, 2018.
The registration is a lengthy process with various documents to be prepared. Given the tight deadline, quick actions and preparations are highly advisable.
Since the Sanlu milk scandal in 2008, the production of IF has been under strict scrutiny in China. The revised Food Safety Law implemented on October 1, 2015 requires, for the first time, IF producers to register their IF recipes at the CFDA. Those IF producers which fail to register their IF recipes will face the threat of severe penalties. The authorities may confiscate their illegal incomes, products, raw materials, production devices, etc. In addition, the violators may face a fine up to 20 times the value of the produced IF, and, in the worst case, the responsible persons may also face criminal charges.
On June 8, 2016, the CFDA promulgated the long-awaited rules on IF recipes, the Administrative Measures on the Registration of Recipes of Infant Formula Milk Powder (“Measures”), which will be implemented on October 1, 2016.
2. Lengthy process and urgency for applications
According to the Measures, it takes at least 7 months for domestic IF producers to complete the registration. It could take even longer for foreign IF producers because of the longer time required for the CFDA’s inspection of the manufacturing sites of foreign IF producers and the unpredictable timeframe which is determined at the CFDA’s discretion. Even with the grace period it remains a concern for foreign IF producers – whether their registration can be completed in time. This is also because there are potentially around 170 domestic and foreign IF producers which will all rush for registrations after October 1, 2016. In any case, early preparation and quick application are highly advisable.
3. Grace period for completing the registration
According to an explanation regarding the CBEC Commodity List made by the Ministry of Finance on April 13, 2016, for IF sold via CBEC, the recipe registration must be completed before January 1, 2018. If the registration has not been completed by this date, any related unregistered IF cannot be sold via CBEC in mainland China. This grace period also likely applies to domestic IF. However, this can only be said with certainty after the CFDA has made the expected announcement.
4. Overall requirements on IF producers and recipes
Domestic and foreign IF producers, as applicants, are required to have R&D, production and inspection capabilities and implement GMP (Good Manufacturer Practices) and HACCP (Hazard Analysis and Critical Control Point) systems. They shall conduct an ex-factory inspection in ac-cordance with the national standards for their self-produced IF. The documentary proof of com-pliance has to be submitted with the recipe registration application.
The recipes are required to comply with the Chinese laws and regulations, and the national standards. Applicants have to submit R&D reports and other documents proving the safety of the recipes and raw materials.
5. Significant restrictions on number of recipes and claims
Each IF producer can only, in principle, hold up to 3 recipe series and 9 recipes. Each recipe series covers an infant formula (0 to 6 months, stage one), a formula for elder infants (6 to 12 months, stage two) and a formula for young children (12 months to 36 months, stage three). Moreover, if one producer applies for two or more recipe series for the same development stage, the recipe series must have obvious differences between each other based on scientific research.
As per news reports, currently there are around 2,000 IF recipe series sold in China. As men-tioned above, there are currently approximately 170 domestic and foreigner IF producers and, in theory, there will be around 510 recipe series allowed for registration. In other words, the new Measures will certainly reduce the number of IF recipe series in the market and may significantly affect those producers which operate multiple recipe series simultaneously.
The Measures also introduces some very specific restrictions on claims printed on labels and specifications. Claims like “imported milk source”, “eco pasture”, etc. which are not unusual in the market, are expressly prohibited. A violation leads to administrative sanctions like fines.