agriculture, food and beverage (afb) working group · agriculture, food and beverage (afb) working...

Agriculture, Food and Beverage (AFB) Working Group

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Key Recommendations1. Standards Issues a. Food Additives · Implement suffi cient transitory measures of GB2760-2011 covering both imported and locally-produced food

products. · Continue updating GB 2760 using a scientifi cally based approach with continuous reference to relevant

international standards/codes such as FAO/WHO’s CODEX, JECFA to better incorporate new additives that are already extensively used worldwide.

· Establish a fast track application process for food additives that offer no safety concerns, for example, those already listed in internationally recognised standards such as Codex and JECFA.

· Develop and maintain a timely updated online version of GB 2760, freely accessible for public consultation.

b. Labelling · Provide a suffi cient transition period (e.g. at least three years) for the coordinated implementation of all

labelling standards being revised and under revision. · Increase local inspection authorities’s understanding of the labelling regulatory requirements and encourage

communication between different local bodies (AIC, CIQ, TSB) when an issue of compliance arises.

c. Alcoholic Beverages · Recognize the importance of product quality standards and update the standards defi ning Western alcoholic

beverages to bring them in line with relevant international standards, particularly ensuring that the limits of the analytical parameters set for vodka will take into account those properties linked to fl avoured vodkas.

· Revise GB 2757-1981 to set methanol limits in accordance with relevant international standards so as to accommodate traditional European alcoholic beverage products such as grappa and tsipouro, fruit spirits, as well as Mexican tequila.

d. Cheese Products · Remove the yeast limit for natural cheese in GB 5420-2010. · Revise cheese products standards and make more precise the application of microbiological criteria, bearing in mind

the variety of cheese products and their characteristics.

e. Paediatric Nutrition · MOH to clarify that FSMP products should be regulated under GB 25596-2010, which comes into effect

from January 1, 2012, onward. Before this date, all current products, especially those imported, should be treated as status quo, i.e., as those imported products without national standards.

· MOH to draft and publish an ordinance on implementation of GB 22596-2010, in which a designated agency should be available for fi ling/evaluation of the FSMP product based on scientifi c data and safety assessment. Such a fi ling/evaluation record should be made an indispensable element to the issuing of product licence (i.e. QS licence) by AQSIQ as well as to the Customs clearance. Such an approach will split the oversight and responsibility amongst ministries, and thus might have a better chance of being accepted in today’s situation.

· MOH to take the lead for revision of the current China code of Marketing of Beast Milk Substitutes.



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European Business in China Position Paper欧盟企业在中国建议书 2011/2012

· Set up the monitoring system on market violation. · Keep the current practice of on-pack label claim.

f. Pet Food · Offi cially recognise the petcare professional industry and set up all relevant legislation and standards for the pet food

industry. · Involve the petcare industry in the drafting procedure of regulations and standards so as to benefi t from the industry’s

international know-how and best practice. · Consider developing a similar "Guide to good practice for the manufacture of safe pet foods" written by FEDIAF

g. Feed Additives · Recognise the EU controls, by an EU and China bilateral agreement, on the assessment and approval of feed

additives and simplify the registration process for the import of EU-authorised feed additives into China given that the General Administration of Quality Supervision, Inspection and Quarantine (AQSIQ) order 118 (2009) includes risk assessment.

· Ensure that the approved feed additives list is on a publicly accessible government website including all conditions for the additives’ use and registration.

h. Application Procedure · Provide suffi cient guidelines and training for all local offi ces of the Inspection and Quarantine Bureau of the People’s

Republic of China (CIQ) to ensure consistency of interpretation and implementation of the regulations.

i. Sanitary (Hygiene) Certifi cate for Imported Food and Beverage Products · Ensure suffi cient resources to speed up the processing of certifi cates. · Authorise independent third-party-certificated organisations and laboratories to satisfy the growing demand of

certifi cation and testing. · Continue to improve facilities on a national level and ensure adequate storage (particularly temperature-controlled

storage) at both CIQ and Customs. · Ensure that Sanitary (Hygiene) Certifi cates issued at one port of entry be accepted throughout China without need to

apply for certifi cate fi ling for the same cargo in other places where distribution occurs · Provide a tracking system for certifi cate processing and timing.

2. Traceability Issues a. Food and Beverage Related · Protect existing foreign lot codes on imported products in the Chinese market · Fully and effi ciently implement the Food Safety Law Recall provisions

b. Feed Additives, Feed Materials and Compound Feed · Adopt legislation to cover ‘edible agricultural products and feed’ to help ensure a high level of protection of public

health, taking into account the protection of animal health and welfare. · Introduce compulsory requirements for suppliers of feed additives, feed materials and compound feeds to be

accountable for risks associated with biological, chemical and physical hazards. · Introduce a supervisory system to ensure traceability of feed additives, feed materials and compound feed from

manufacturer to fi nal user. · Update existing Chinese feed legislation to bring it in line with this proposed framework.


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3. Agriculture Issues a. Arable Farming · Adopt systematic and concrete measures to encourage land consolidation. · Encourage more effi cient use of agro-chemicals through the development of schemes similar to FACTS

and provide training on the application of these schemes to reduce over-use of chemicals and soil-

contamination issues. · Encourage the adoption of advanced seed technologies. · Protect agricultural intellectual property rights. · Further invest in improvements in rural infrastructure.

b. Animal Nutrition I. Quality and Safety Control of Feed Additives, Feed Materials and Compound Feed · Adopt a compulsory requirement for the suppliers, processors and producers of manufactured feed and feed

materials and compound feeds to be responsible for the information on the product label. · Ensure that the new catalogue for feed materials includes a description of the product concerned and, where

appropriate, any process involved in its production, especially if there is the presence of any chemical impurities and/or processing aids.

· Ensure the published list of undesirable substances applies to all manufactured feeds and feed materials and compound feeds.

· Adopt controls for imported products that are no more onerous to those imposed on products produced in China, and recognise the EU catalogue as required under regulation 787/2009 on the marketing and use of feed for imported feed materials.

· Ensure controls as defi ned in Regulation 118 are appropriately and consistently enforced to help protect the integrity of the Chinese export market.

II. Develop Assurance Programmes for Quality and Safety in Animal Food Products · Work to develop appropriate auditing schemes and professional qualifi cations to ensure the quality and safety of

feed additives, feed materials and compound feeds. · Adopt an annual audit developed in partnership with an internationally recognised organisation specialising in

feed and food assurance on all suppliers of feed additives, feed materials and compound feeds to help improve traceability.

· Develop a specialised training programme for inspection offi cials to increase the number of suitably qualifi ed and experienced inspectors who possess adequate facilities and equipment to carry out their duties.

· Make specifi c reference to HACCP principles and the likely hazards and effective controls. The methodology to be used for offi cial tests should be available to the industry to enable manufacturers to carry out their own quality control of the products they use and produce.



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Introduction to the Working GroupThe European Union (EU) plays a key role in the world trade of agricultural products and food and beverages. It is now the world’s largest exporter1 (total EUR 53.7 billion in 2009, showing a 8.0% decrease over 2008) and importer (total EUR 50.8 billion in 2009, showing a 14.2% decrease over 2008) of food and drink products worldwide (excluding intra-EU trade with a total surplus of EUR 3 billion).

Established in 2003, the Agriculture, Food and Beverage (AFB) Working Group, is a communication platform between European companies in the food and beverage sectors and the Chinese regulators and supervising authorities. The group aims to foster positive discussions and ensure better understanding and implementation of policies and regulations, and greater levels of food safety.

The working group (WG) includes a wide range of companies in the food, beverage and agriculture sectors including importers, manufacturers and distributors of food and beverage products, food additives, animal feed, and feed additives, as well as catering service providers, specialised testing laboratories, food and beverage engineering companies and consultancies in marketing and food communication. This chapter also covers issues of the China desk of paediatric nutrition as well as of the European starch industry. Currently the working group has roughly 90 member companies with more than 250 participating individuals.

As in previous years, China is still listed as one of the top 10 export destinations for EU agricultural, food and beverage products worth approximately EUR 1.657 billion in 2009. This represents a year-on-year increase of 15.5% and a 284% increase from 2000 to 2009. Simultaneously, China’s exports of agricultural, food and drink products to the EU continue to grow with a total value in excess of EUR 3,114 billion in 2009. This is a 130% increase from 2000 to 2009.

The food and beverage industry is the single largest manufacturing sector in the EU, with a total turnover of EUR 954 billion in 2009 (accounting for 12.9% of manufacturing overall). It is also the leading employer in the EU (13.5%). In terms of the number of companies, it comprises more than 310,000 companies that range from

1 All date from the Confederation of the Food and Drink Industries in the EU (CIAA)

2010 annual market report: “Data & trends of the European Food and Drink Industry

2010”

large-scale multinational companies (MNCs) to small- and medium-sized enterprises (SMEs). In the EU, an SME is defined as having less than 250 employees. SMEs contribute 48.2%of the aggregate turnover and account for 62.8% of total employment.

The performance of EU products in expanding markets such as China, measured as the share of food and drink imports originating from the EU compared with the share of imports originating from other countries, remains stable. On the other hand, food and drink imports to the EU from new agricultural markets, such as China, are becoming increasingly important.

Recent DevelopmentsChina has made safety and quality within the agriculture, food, and feed industries a national priority. The Food Safety Law issued in 2008, the establishment of the National Food Safety Commission, and the Food Safety Work Plan 2010 are major steps in creating China’s nationwide system designed to protect both the industry and the consumers.

With these systems in place nationally, China aims to ensure quality at every step from farmer to fork. However, industry experts have noted that within the framework of these new laws and policies some issues remain that will hinder their overall implementation and feasibility. These issues are present both at the national and local levels. Some of the issues include: a lack of international standardisation in processes or allowances, thus inhibiting the ability of international and domestic producers to make full use of acceptable resources; an absence of sufficient cross-ministry coordination and overlapping administrative responsibilities that cause signifi cant delays and increase costs; unclear implementation rules and transitory measures that result in a decreased ability to enforce food safety provisions, and a lack of consistency in consolidation, training, and resources that create risk to both food and feed safety. These areas of concern will each be improved by utilising insider knowledge from the domestic market and abroad, and through applying international standards that have been tested and proven through a scientifically based approach. China and the EU must continue to work together through open communication on improving the framework on which the Chinese Government has placed such a high priority.


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Commitment to product safety on both sides reinforces a desire for trade. Improving coordination of trading standards and traceability will create a mutually benefi cial atmosphere. Unfortunately, technical barriers to trade continue to impede imports of a number of European agricultural and food products into China. Even for experienced EU companies operating globally, the diversity of technical requirements and certification schemes coupled with a lack of predictability and consistency are a signifi cant burden that may hamper trade development as companies incur signifi cant delays and additional costs.

Risk communication, together with risk assessment and risk management form the risk analysis framework central to contemporary food safety control. It is in the interest of all to increase the effectiveness of food-risk communication, especially among non-food professionals such as consumers and the media. The working group would be keen to bring in and share more European and international experience and resources on this with local stakeholders.

The European Chamber welcomes the continuous ef-forts to revise the existing food quality standards, health standards, and industry standards in order to: 1. address missing, duplicated, or conflicting problems in the stand-ards; 2. establish a sound scientifi c and unifi ed food safety standards system on the basis of risk assessment, and 3. to extend the approach to cover feed and feed additives.

The WG supports the ongoing dialogue between China and the EU on geographical indications (GI), The WG also suggests exploring ways to make the concrete use of the GI as a legal tool to protect the product and enhance the implementation of granted GIs.

The AFB working group firmly believes in China’s commitment to and welcomes the opportunity to have an open dialogue on behalf of the industry with relevant authorities throughout China and the EU in the interests of all.

Key Recommendations1. Standards Issues

The setting of standards is one of the key elements for the free flow of goods in international trade. The WG would like to attract the attention of relevant local authorities on the potential negative effects of inadequate revisions

of legislations and on the need to better integrate international standards.

The development of compulsory national food safety standards shall be more grounded on food safety-related parameters with reference to risk analysis. The lack of streamlined coordination between ministries leads to overlong authorisation delays and disproportionate costs for companies.

a. Food Additives ConcernMassive changes are included in the GB2760--2011 that was published in May this year for implementation on June 20. At the time of writing, no transitory measures have been published. Specifi c consideration would in particular be needed as regards the additives that are covered by international standards but not Chinese ones.

AssessmentTransitory measures are deemed necessary to avoid trade and investment disruptions. Transitional periods shall be meaningful enough for companies to adapt recipes and to fi le applications for additives or usages not included in the Chinese legal provisions. They should also clarify that certain types of products manufactured before the adoption of the revised standards are not concerned. According to the current system, promulgation of the national food safety standard by MOH is a prerequisite for AQSIQ to accept the application of production license for that food additive. Transitional production licences should be given to EU companies producing in China until clarifi cation on rules or until applications for the currently used additives can be approved.

There is vast difference between Codex and GB 2760-2011, in terms of number of food additives included, indicates. For public health purposes, a restricted list of permitted food additives is not necessarily the best solution for combating the use of harmful substances added to food. On the contrary, a comprehensive list of modern food additives can help companies produce safer food with a higher effi ciency and often lower costs. The latter is more effective in discouraging the use of banned and/or risky substances.

The WG members agree that it is reasonable to be cautious in the registration procedure for novel and rare food additives. However, the WG maintains that a fast track should be in place to facilitate the registration



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procedure for food additives that offer no safety concerns, for example, those that have already been listed in Codex for many years, and which are used extensively worldwide. Simplified application procedures should also be sought for additives that are already authorised in China for some products but not for others. This will not only help lessen an enterprise’s operational burden but also optimise the administrative resources of government agencies.

Recommendation· Implement sufficient transitory measures of GB2760-

2011 covering both imported and locally-produced food products.

· Continue updating GB 2760 using a scientifically based approach with continuous reference to relevant international standards/codes such as FAO/WHO’s CODEX and JECFA to better incorporate new additives that are already extensively used worldwide.

· Establish a fast-track application process for food

additives that offer no safety concerns, for example, those already listed in internationally recognised standards such as Codex and JECFA.

· Develop and maintain a timely updated online version of GB 2760, freely accessible for public consultation.

b. Labelling

ConcernA number of national standards for food safety that are related to labelling modifications have been or will be in place sequentially since 2010. Transitory measures, if not missing completely, are very often tardy or not comprehensive enough for companies to adapt to massive changes. Consequently, manufacturers need to invest substantial resources to rearrange packaging, which will result in unnecessary waste and a negative impact on sustainability and environment protection.

A non-exhaustive list of revised regulations and standards relevant to labelling and their effective time

Name of regulations or standards Effective Time

AQSIQ (Notice on the implementation of the newly revised <Food Labelling

Regulations＞ (General Notice No. 100, 2009)June 1, 2010

AQSIQ ( Notice on the enterprise Product Manufacturing License Label)

(General Notice No.39, 2010), requested the modification of the Quality &

Safety (QS) label

Companies that were granted production

licences before June 1, 2010, can continue using

the packaging with old version of production

licence logo for another 18 months.

66 national food safety standards of dairy products April 1, 2011

National Food Safety Standard for Uses of Food Additives (GB2760-2011) in-

cluding massive changes June 20, 2011

National Food Safety Standard for the labelling of Pre-package Food

(GB7718-2011)April 26, 2012

National Food Safety Standard for Nutritional Fortification Substances in

Food(GB14880-xxxx)To be issued with unknown transitional period

The National Food Safety Standard for Nutrition Labeling(GB xxxx-xxxx) To be issued with unknown transitional period

Revised version of hygiene standards for fermented and distilled alcoholic

beverages GB 2758 and GB 2758 (still under WTO notifi cation status) include

new labeling requirements.

Any other national food safety standards that would involve labelling

modifi cations?

Not published yet

Transitional period?


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AssessmentAs massive changes are included, a long transitional period is required to permit companies to adapt. In the EU, the average grace period for food legislation is from three to fi ve years depending on the size of the company. As stated in last year’s paper, the WG members have encountered operational difficulties in coping with the insuffi cient transitional period for GB7718—2011.

Recommendation· Provide a sufficient transition period (e.g. at least three

years) for the coordinated implementation of all labelling standards being revised and under revision.

· Increase local inspection authorities’ understanding of the labelling regulatory requirements and encourage communication between different local bodies (AIC, CIQ, TSB) when an issue of compliance arises.

c. Alcoholic Beverages

ConcernChinese general classification standard for alcoholic beverages (GB/T 17204-2008) and the specific product standards of western alcoholic beverage products (GB/T 11856-2008 for brandy, GB/T 11857-2008 for whisky, and GB/T 11858-2008 for vodka) are not in full conformity with relevant international standards for western alcoholic beverages. The WG is concerned that these problems could potentially lead to consumer deception by allowing for the production and marketing of Western alcoholic beverage products that are subject to less stringent standards then those made in the EU with no guarantee of administrative or legal enforcement.

Also, the ongoing amendment proposal on Chinese Hygiene Standard for Distilled Spirits and Integrated Alcoholic Beverages (GB 2757-1981) sets a methanol limit that could block traditional European grape marc spirits such as grappa and tsipouro, fruit spirits, as well as Mexican tequila from entering the Chinese market.

AssessmentI. The General Classifi cation Standard of Alcoholic Beverage

GB/T 17204-2008, adopted in 2008 only defines brandy, whisky, rum, gin and vodka, and these definitions are lacking in substance in the following aspects:

a. Absence of minimum alcoholic strength for categories of products without specific product standards such as gin or rum. This could potentially allow products of extremely

low alcohol strength to be sold under the name of gin or rum, even though their taste would bear no likeness to the genuine product, and even lower versions could be allowed, thus blurring the difference between spirits, wine and beer.

b. There is presently no definition for other spirits categories, such as wine spirit, London gin, liqueurs, aquavit, bitters, etc.

II. The specific product standards (GB/T 11856-2008 for brandy, GB/T 11857-2008 for whisky, and GB/T 11858-2008 for vodka) are overly stringent in some areas, potentially leading to trade barriers:

a. Analytical parameters set in GB/T 11858 for vodka have been designed for neutral vodkas and are not adapted to fl avoured vodkas. A regulatory solution needs to be found so as fl avorured vodkas can be integrated in the Chinese regulatory framework. GB 11856 for brandy, GB/T 11857 for whisky and GB/T 11858 for vodka are not in line with relevant international standards, such as the EU standards, and the limit on higher alcohol, which has been removed from the Chinese Hygiene Standard for Distilled Spirits and Integrated Alcoholic Beverages (GB 2751-1981), has been retained in GB/T 11858 for vodka.

b. Limitations on naturally occurring substances for whisky (acetic acid, esters, etc.), vodka, and other ethyl alcohols are not in line with international practices.

III.They are weaker than EU definitions in certain areas, opening a door to substandard products, hence potentially leading to situations of unfair competition:

a. The standards do not set specific distillation strength for the ethyl alcohol used to make the various spirits categories. Maximum distillation strength is intended to prevent the addition of ethyl alcohol to products that have to retain the organoleptic characteristics derived from their raw materials. Conversely, minimum distillation strength is intended to ensure the quality of those other spirits relying on ethyl alcohol, so that the alcohol reaches the necessary level of purity. Therefore, the standard fails to make a fundamental distinction between spirits in which raw materials are not distilled all the way through for taste purposes (whisky, brandy, etc.) and spirits in which distillation is carried out at very high levels to better accommodate the use of fl avourings (vodka, gin, aquavit etc).

b. Raw materials for vodka should be indicated when the materials used are not traditional (i.e. cereal or potato).



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c. The use of fl avourings is currently not explicitly prohibited in GB/T 11856-2008 for brandy and in GB/T 11857-2008 for whisky. However, it is defi ned in EU regulations.

d. Prohibition on the use or addition of ethyl alcohol. In the case of brandy (GB/T 11856-2008), however, it is allowed when using the term “blended brandy”. This expression may be confused by the consumer with “blended whisky”, which in Europe has a different meaning and is not allowed to contain ethyl alcohol at any time.

IV. The currently proposed amendment on Chinese Hygiene Standard for Distilled Spirits and Integrated Alcoholic Beverages (GB 2757-1981), if adopted, would pose a threat to the trade of some alcoholic beverages given its mandatory nature. The proposed new limits on methanol levels are not in conformity with relevant international standards. For instance, the current limit on the level of methanol is based on a product classification that could potentially block grappa and tsipouro, traditional fruit-based spirits, as well as Mexican tequilas, from entering the Chinese market. Some products that are not subject to any methanol limitation in Europe would fall under the restriction of this new Chinese standard without any proper scientifi c justifi cation for deviating from generally accepted standards in other regions of the world.

Recommendation· Recognize the importance of product quality standards

and update the standards defining Western alcoholic beverages to bring them in line with relevant international standards; particularly ensuring that the limits of the analytical parameters set for vodka will take into account those properties linked to fl avoured vodkas.

· Revise GB 2757-1981 to set methanol l imits in accordance with relevant international standards so as to accommodate traditional European alcoholic beverage products such as grappa and tsipouro, fruit spirits, as well as Mexican tequila.

d. Cheese Products Related

ConcernCheese naturally contains yeast. This yeast has been proven to be harmless to humans and, therefore, should not be subject to maximum restrictions in corresponding standards.

Assessment Yeasts are generally widespread in the environment because of their great capacity for adaptation to many

substrates. It is normal to find yeast in dairy production and, moreover, lactic yeasts come about naturally. It has been proven that the presence of yeast in cheese products does not form any part of a recognised pathogenesis and thus does not present any danger to the consumer.

In other markets, such as the EU, where cheese consumption has a much longer history, there is no safety concern or limit set for yeasts in dairy products in general. More information can be found in European regulations concerning the hygiene of foodstuffs such as CE N°852/2004 and CE N°2073/2005.

In March 2010, China issued GB 25192-2010 and GB 5420-2010 both of which will come into effect on December 1, 2010, to replace GB 5420-2003. The WG appreciates the effort required to update the standards, but the members remain concerned that the maximal level of yeast is still restricted to 50 cfu/g. This restriction cannot be achieved for natural cheese and does not take into account the manufacturing techniques of natural cheese, which are different from processed cheese. The Working Group is concerned about the application of the microbiological criteria for yeast and mould as indicators for the safety and quality of cheese. The microbiological criteria for yeast and mould should only be applicable when a proper interior sample is taken. Without a proper sample, the general criteria will lead to confusion, given the varied characteristics of different types of cheeses.

Recommendation· Remove the yeast limit for natural cheese in GB 5420-

2010.· Revise cheese products standards and make more

precise the application of microbiological criteria, bearing in mind the variety of cheese products and their characteristics.

e. Paediatric Nutrition

ConcernThe missing and incomplete measures in the national standard of special food for medical purposes intended for infants (GB 25596-2010) hamper the implementation of this standard and jeopardise Chinese customers’ access to products that are indispensable for the dietary management of babies with special needs.


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AssessmentGB 25596-2010 comes into effect from January 1, 2012, onward. As the national standard for infant formula GB 10765-2010 comes into effect on April 1, 2011, some of the existing FSMP products in the market are facing the risk of being rejected by falsely being assessed with GB 10765-2010 or GB25596-2010.

At present, it is required that specifi cations be prepared for all categories of products listed in Appendix 1 of GB 25596-2010, which has no previous experience domestically and internationally. Such a requirement resulted in some of the specifi cations having an unexpected huge range from minimum to maximum values that may satisfy the needs of the products being tested and assessed. However, it cannot prevent the arbitrary production of FSMP based on those specifi cations of huge ranges like that for LBW and HMF, thus attracting concerns of health risk to preterm and low birth-weight babies.

Special products designed specifically to meet the particular nutritional requirements of infants and young children with a specific disease, disorder or medical condition are indispensable for the dietary management of these individuals and are to be used in accordance with medical advice. The safety and effi cacy of FSMP products should have science substantiations.

Recommendation· MOH to clarify that FSMP products should be regulated

under GB 25596-2010, which comes into effect from January 1, 2012, onward. Before this date, all current products, especially those imported, should be treated as status quo, i.e., as those imported products without national standards.

· MOH to draft and publish an ordinance on implementation of GB 22596-2010, in which a designated agency should be available for filing/evaluation of the FSMP product based on scientific data and safety assessment. Such a filing/evaluation record should be considered as an indispensable element to the issuing of a product licence (i.e. QS licence) by AQSIQ as well as to the customs clearance. Such an approach will split the oversight and responsibility among ministries, and thus might have a better chance of being accepted in today’s situation in which the crime of dereliction of duty of food safety was just added to the Chinese Criminal Law.

Concern Weak implementation of the Chinese Code of Marketing of Beast Milk Substitutes (China code) causes concern over aggressive promotion of infant formula in China, which interferes with the implementation of the International Code of Marketing of Breast Milk Substitutes (WHO code) and those related WHA resolutions. At present, breast milk substitutes are aggressively marketed and promoted, especially by local companies, while the multinational companies are in line with their headquarters to comply with the WHO code. Such an unbalanced practice between local and multinational companies causes concern about unfair competition in the market.

AssessmentThe key message from the WHO code is to protect and promote breast feeding and ensure the proper use of breast milk substitutes when necessary. These points are also the same in the China Code. The current China Code was published in 1995. It needs to be changed to integrate new WHA resolutions into it.

Recommendation· MOH to take the lead for the revision of the current China

code of Marketing of Beast Milk Substitutes. · Set up a monitoring system on market violation

ConcernIn October 2010, the MOH proposed revising the National Standard of General Standard for the Labelling of Pre-packaged Foods for Special Dietary Uses (GB13432-2004). The draft revision signifi cantly restricts both content and functional claims on the packaging label. Such a wide restriction would eliminate the most direct channel for consumers and healthcare professional to learn about essential product information and to make informed decisions on product selection. For FSMP products, on-pack function claims provide critical information for correct usage. Such restriction of direct communication to the consumer may discourage innovation.

AssessmentCurrent National Standard GB13432-2004 allows nutrient content and function claims on infant formula (0 to 6months) and follow-up formula (6 to 36months). There have not been safety issues due to on-pack label claims because AIC has been monitoring the validity of the claims effectively.



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On-pack claims and other information are an important means for consumers and healthcare professionals to obtain important nutrition information and select the right products for the babies. It is extremely crucial for FSMP users.

Restriction on claims could significantly discrouage the industry’s innovation.

Removing label claims is not consistent with Codex standards and the practice in EU countries and Australia/New Zealand.

Recommendation· keep the current practice of on-pack label claims

f. Pet Food

ConcernThere are a signifi cant number of pet food manufacturers and their products in the Chinese market, particularly at the lower end of the industry. However, there is currently a grey area between the feed and pet food industry, and no specifi c standard has yet been applied to the pet food industry.

Assessment Without an official definition of the pet food industry, the application of standards of the raw material specifi cation, GHP/GMP and food safety of pet food can vary widely and remain subject to individual interpretations. With no recognition of pet food as a professional industry, and with no specifi c legislation pertaining to it, an unregulated market has developed where people can manipulate the ambiguity of standards so as to avoid product-quality obligations that eventually put animal health and safety at risk.

Recommendation· Officially recognise the petcare professional industry and

set up all relevant legislation and standards for the pet food industry.

· Involve the petcare industry in the drafting procedure of regulations and standards so as to benefit from the industry’s international know-how and best practice.

· Consider developing a similar "Guide to good practice for the manufacture of safe pet foods" written by FEDIAF

g. Feed Additives Related

ConcernWhere feed additives have already been approved in the EU, valuable resources in China could be better appropriated through having a fast-track registration system.

AssessmentProvided controls underpinning additive approval in the EU meet controls in place in China, feed additives that have already been approved should be more readily available to the feed industry via a fast track system. There is already a comprehensive regulation in the EU on the assessment and approval of feed additives. New provisions are being introduced in China that are designed to improve the supervision and management of new feed additives. The WG would welcome the opportunity to work with the Chinese authorities in developing and implementing this legislation.

Recommendation· Recognise the EU controls, by an EU and China bilateral

agreement, on the assessment and approval of feed additives and simplify the registration process for the import of EU authorised feed additives into China given that the General Administration of Quality Supervision, Inspection and Quarantine (AQSIQ) order 118 (2009) includes risk assessment.

· Ensure that the approved feed additives list is on a publicly accessible government website including all conditions for the additives’ use and registration.

h. Application Procedure

ConcernWith regard to the application procedure, labelling regulations are not being thoroughly and uniformly interpreted and implemented throughout the country.

AssessmentThe European Chamber welcomes, in principle, the 2006 AQSIQ Notice No. 44, ‘Notice on Modifying the Labelling Audit System for Import and Export Foods and Cosmetics’, which took effect on April 1, 2006. This renders the pre-labelling verification process by central AQSIQ unnecessary and shows AQSIQ’s attempts to improve the labelling process.

While the abolition of the pre-labelling verification


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procedures should lead to a more efficient process for companies importing food and beverage products into China, industry members continue to encounter widespread inconsistencies in regulation interpretation and fulfi lment three years after the initial implementation. The lack of pragmatic guidelines and training at the local China Inspection and Quarantine Service (CIQ) offi ces has hampered the implementation and has thus prevented the delivery of positive results.

Also, the lack of a coordinated national system has meant that some companies have encountered a situation whereby a label accepted at one port of entry is refused at another. This causes unnecessary delays and costs to the importer. It should be the case that if a label has been given approval by one office of the CIQ it is recognised nationally and will then be automatically approved by all other CIQ offi ces.

Recommendation· Provide suffi cient guidelines and training for all local CIQ

offices to ensure the consistency of interpretation and implementation of the regulations.

i. Sanitary (Hygiene) Certificate for Imported Food and Beverage Products

ConcernThree key issues continue to jeopardize businesses of,,,: 1. The continued unpredictability and inconsistency in both the testing time and methodology; 2. Sanitary (Hygiene) Certificates issued in one location are not accepted in others; 3. There is a lack of adequate storage facilities at ports of entry.

Assessment It is essential to obtain a Sanitary (Hygiene) Certificate before customs clearance. However, this testing process can be lengthy, with little clarity on timing required for approval. The availability of a timing reference for certificate processing can help the importer/distributor to better prepare and plan.

In order to speed up testing and achieve efficiency, it is essential for authorities to be equipped with sufficient resources. The WG is concerned about laboratory issues, which include a lack of transparency of testing methodology, laboratory facilities and professional training of staff. There are currently only state-owned laboratories involved in testing and these are seriously overloaded. It is

suggested that the government authorise independent and third-party laboratories to satisfy the growing demand for these laboratories.

As far as testing standards are concerned, sufficient guidelines and technical training are needed to ensure consistency and transparency of interpretation at all local CIQ offi ces throughout China. The WG also suggests that hygiene certifi cates issued in one location be accepted by the CIQ in other locations.

In instances where distribution takes place in an area other than the port of entry, importers/distributors are asked to apply for certificate filing for the same cargo and pay ‘local application fees’ again in the distribution area. This duplicate registration and fee brings forth unnecessary delays and burdens for importers/distributors, which could also eventually hamper the government’s efforts to control food-price infl ation.

Finally, while significant improvements have been made over the past 10 years in providing storage facilities for imported goods at local CIQ and customs houses, the national average is much lower than the industry requires. Greater investment is still needed to ensure that storage facilities meet the actual requirements of both importers and distributors.

Recommendation· Ensure suffi cient resources to speed up the processing of

certifi cates.· Authorise independent and third-party-certificated

organisations and laboratories to satisfy the growing demand for certifi cation and testing.

· Continue to improve facilities on a national level and ensure adequate storage (particularly temperature-controlled storage) at both CIQ and customs.

· Ensure that Sanitary (Hygiene) Certifi cates issued at one port of entry will be accepted throughout China without the need to apply for certifi cate fi ling for the same cargo in other cities where distribution occurs.

· Provide a tracking system for certificate processing and timing.

2. Traceability Issues

a. Food and Beverage

Concern The Chinese Food Safety Law highlights the importance



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of the food-recall system. While welcoming the initiative of the Chinese government to better protect the consumer’s rights and interests, the WG is concerned that the absence of measures to facilitate traceability impedes an enterprise’s capability to trace and recall imported products. Should this happen, it poses a threat to local consumers and hampers an enterprise’s capability to cooperate with the Chinese government on food safety initiatives.

Assessment Under EC regulations, all food and beverage products manufactured in the EU must be labelled with a lot code. Thus, all products exported from the EC will bear a manufacturer’s lot code at the time of export. EC regulations also require manufacturers of food and beverage products in the EU to provide a mechanism that allows traceability of its products throughout the supply chain. These lot codes then allow for an effective product recall system if a recall is required.

However, there have been cases where the genuine products imported had their trace codes intentionally removed before the products entered the Chinese market. Removal of the original manufacturer’s lot code greatly hampers a manufacturer’s ability to trace and recall a product globally in the event of a problem. Importation of food and beverage products without the original manufacturer’s lot code allows the importation of tampered products, reduces the global traceability of products, and unnecessarily increases the risk to local consumers. Hence penalties should be imposed on those tampering with lot codes on food products and products bearing evidence of a tampered lot code should not be allowed for sale on the Chinese market, .

Recommendation· Protect existing foreign lot codes on imported products in

the Chinese market · Fully and efficiently implement the Food Safety Law

Recall provisions

b. Feed Additives, Feed Materials and Compound Feed Related

ConcernMany food scares have their origins in feed additives and feed materials that are incorporated into compound feeds produced either commercially or on farms and used to feed livestock. This causes great concern among the general population in China and consequent lack of confi dence in

feed and food producers as well as the authorities. It has also alerted countries that import Chinese feed ingredients to the need to assess the risks of such goods before use.

AssessmentThe availability of wholesome feed and feed additives, feed materials and compound feeds free from contaminants is essential for the feed and food industry in China. Only certain chapters of China’s Food Safety Law, effective on June 1, 2009, apply to ‘edible agricultural products’ and, thereby, livestock products. A supervisory system to ensure traceability of products from manufacturer to fi nal user would assist in any recall procedure when and where necessary.

Recommendation· Adopt legislation to cover ‘edible agricultural products and

feed’ to help ensure a high level of protection of public health, taking into account the protection of animal health and welfare.

· Introduce compulsory requirements for suppliers of feed additives, feed materials and compound feeds to be accountable for risks associated with biological, chemical and physical hazards.

· Introduce a supervisory system to ensure traceability of feed additives, feed materials and compound feed from manufacturer to fi nal user.

· Update existing Chinese feed legislation to bring it within this proposed framework.

3. Agriculture Issues a. Arable Farming

Concern Although the Chinese Government is encouraging land consolidation for rural areas, local farmers lack the incentives and regulations needed for them to change their land status. For foreign investors in the agriculture sector or food processing industries, land consolidation is usually an important condition for promoting mechanisation, introducing advanced technologies to agriculture and improving crop yield and quality. The implementation of favourable regulations would assist both the growers and investors in achieving an increase in overall yield.

Also affecting growers is the use of pesticides, herbicides, and other agro-chemicals. These chemicals are produced and sold by numerous factories and dealers. Although both central and provincial governments have attached great


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importance to supervising this market, the regulations and enforcement are far from suffi cient to ensure product safety and quality.

In the Guidance of Foreign Investment Industries promulgated in November 2007 by the Nat ional Development and Reform Commission (NDRC), foreign investment in relevant seed technologies is listed in either restricted or prohibited catalogues. This is also true for some cereal processing industries. It is understood that China needs to keep control over the seed sector because of national security concerns. However, the explicit restrictions and inflexible enforcement of the policies prevent China from gaining access to many of the most advanced seed technologies in the world. Intellectual property rights (IPR) are also an issue of great concern on the part of the European companies when investing in Chinese agriculture sectors.

Assessment Land sufficiency, crop yield and agricultural productivity remain the key elements to ensure long-term sustainable national food security. There are several key elements that are required to achieve the maximum benefi t including land consolidation, knowledge sharing, investment and effective use of agro-chemicals. However, the critical changes that are required in order to make these improvements cannot happen without land consolidation.

Once consolidation has been achieved, technologies and best practice from Europe can help to accelerate China’s plan to upgrade arable practices to increase yields. Access to these technologies and know-how requires a more open approach to foreign investment. The total foreign direct investment (FDI) in the sector accounts for only 2% of the total foreign investment that China receives from the world. Regulatory restrictions on many agricultural processing industries discourage foreign investors from committing substantial investment in this area for any length of time.

More effi cient use of proven modern agro-chemicals would also help to improve yields, improve food quality and safety, and eliminate highly toxic chemicals. Recently the presence of toxic vegetable products in some areas has raised concern. This increases the relevance of facilitating market entry for internationally established chemical products that will offer safer and more effi cient alternatives. Meanwhile, the WG suggests the government further improves transparency and decision-marking within rural investment projects to ensure efficiency. Private sector

investment in irrigation systems, road building, and electricity supplies can also be encouraged to attract more capital.

Recommendation· Adopt systematic and concrete measures to encourage

land consolidation.· Encourage more effi cient use of agro-chemicals through

the development of schemes similar to FACTS. Training on the application of these schemes to reduce over-use of chemicals and soil-contamination issues.

· Encourage/adopt advanced seed technologies.· Protect agricultural IPR.· Further invest in improvements in rural infrastructure.

b. Animal Nutrition

Improved efficiency and efficacy within the animal feed sector in Europe was a result of adopting simple, practical controls that were developed jointly by the industry and the regulators at no cost to the government. Developing standard assurance schemes for different aspects of the feed supply chain would help to deliver legislative requirements within the market. Practical controls and comprehensive assurance schemes would be an excellent way to support and sustain growth of the animal feed sector in China.

I. Quality and safety control of feed additives, feed materials and compound feed

ConcernThere should be measures in place to ensure the safety of manufactured feeds and feed materials with equivalent controls on both imported and exported products.

AssessmentThe feed industry in China should be able to use wholesome feed materials. There are comprehensive legislative controls in place in the EU that include, under feed hygiene measures, provisions on the need to adopt hazard analysis and critical control point (HACCP) principles, provisions on undesirable substances, and a recently agreed-upon regulation on the marketing and use of feed. Equivalent controls in China would be valuable. Equally, the ability to import feed materials from the EU produced under these controls with minimal additional regulation would be benefi cial.



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Recommendation· Adopt a compulsory requirement for the suppliers,

processors and producers of feed additives, feed materials and compound feeds to be responsible for the information on the product label.

· Ensure that the new catalogue for feed materials includes a description of the product concerned and, where appropriate, any process involved in its production, especially if there is the presence of any chemical impurities and/or processing aids.

· Ensure the published list of undesirable substances applies to all feed additives, feed materials and compound feeds.

· Adopt controls for imported products that are no more onerous to those imposed on products produced in China, and recognise the EU catalogue as required under Regulation 767/2009 on the marketing and use of feed for imported feed materials.

· Ensure controls as defined in Regulation 118 are appropriately and consistently enforced to help protect the integrity of the Chinese export market.

II. Develop assurance programs for quality and safety in animal food products

ConcernThe legislation controlling the production of safe animal feeds is onerous and complex. Producers of feed additives, feed materials and compound feeds can range in size from very large companies to very small organisations. In order to ensure that the integrity of the feed and food chain is maintained and the legislation is fully complied with, all producers would greatly benefit from guides for good practice.

AssessmentMost feed scares have their origins in the feed ingredients used. Ensuring feed ingredients at the source is the most cost-effective way of controlling most feed-related hazards before they happen.

In European countries, three schemes have been developed to cover feed ingredients, feed manufacture and sales, combinable crops and their transport and storage. They are inter-related and include legal compliance, risk assessment (HACCP), good manufacturing practice (GMP), system controls (similar to ISO 9001), and traceability. There is also a fertiliser industry assurance scheme (FIAS) in the UK that covers fertiliser security and traceability.

Since 2006, under feed hygiene regulations, the EU has encouraged the development of community guides to good practice in the feed sector and for the application of HACCP principles. The following guides have now been positively assessed:

· Community guide to good practice for the EU industrial compound feed and premixtures manufacturing sector for food-producing animals — European Feed Manufacturers Guide (EFMC).

· Community guide to good practice for feed additive and premixture operators FAMI-QS — European Association for Feed Additives and Premixtures Quality System.

· European Good Hygiene Practices Guide for the collection, storage trading and transport of cereals, oilseeds and protein crop European cereals, rice, feedstuffs, oilseeds, olive oil, oils and fats and agrosupply trade (COCERAL).

· European Guide to good practice for the industrial manufacture of safe feed materials.

The “Association des Amidonniers et Féculiers” (AAF) and The EU Oil and Proteinmeal Industry (FEDIOL) within the framework of the European Feed Ingredients Platform (EFIP).

Guides should be used as an important part of the enforcement risk assessment. Companies using guides can therefore have an assured status that will help to improve the effi ciency of the inspection process.

Recommendation· Work to develop appropriate auditing schemes and

professional qualifi cations to ensure the quality and safety of feed additives, feed materials and compound feeds.

· Adopt an annual audit developed in partnership with an internationally recognised organisation specialising in feed and food assurance on all suppliers of feed additives, feed materials and compound feeds to help improve traceability.

· Develop a specialised training programme for inspection offi cials to increase the number of suitably qualifi ed and experienced inspectors who possess adequate facilities and equipment to carry out their duties.

· Make specific reference to HACCP principles and the likely hazards and effective controls. The methodology to be used for official tests should be available to the industry to enable manufacturers to carry out their own quality control of the products they use and produce.


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AbbreviationsAQSIQ General Administration of Quality Supervision,Inspection and QuarantineCCFH Codex Committee on Food HygieneCCNFSDU Codex Committee on Nutrition and Foods for Special Dietary UsesCIAA Confederation of the Food and Drink industries in the EUCIQ Inspection and Quarantine Bureau of

the People’s Republic of ChinaEFMC European Feed Manufacturers’ Code EC European CommissionEU European UnionFAO Food and Agricultural Organisation (of the United Nations)FCM Food Contact MaterialFDI Foreign Direct InvestmentFEDIAF The European Pet Food Industry FederationFEMAS Feed Materials Assurance Scheme FIAS Fertiliser industry Assurance SchemeFSANZ Food Standard Australia New ZealandGB Guo Biao (National Standard)GI Geographic IndicationsGMO Genetically Modifi ed OrganismsGMP Good Manufacturing Practice

HAACP Hazard Analysis and Critical Control PointsHCP Health care professionalIT Information TechnologyIFSMP Infant formula for special medical purposesJECFA Joint FAO/WHO Expert Committee on Food AdditivesMNC Multinational CompanyMOFCOM Ministry of CommerceMOH Ministry of HealthNDRC National Development and Reform CommissionPRC People’s Republic of ChinaQS Production LicenceRASFF Rapid Alert System for Food and FeedR&D Research and developmentSME Small and Medium-sized EnterpriseSPS Sanitary and PhytosanitaryTASCC Trade Assurance Scheme for Combinable Crops UFAS Universal Feed Assurance SchemeWHO World Health Organization

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