Category: Ching-Fu Lin

By Ching-Fu Lin

Earlier this year, the Food and Drug Administration (FDA) published for public comment the proposed rule to implement §307 of the FDA Food Safety Modernization Act (FSMA).  The proposed rule is to establish a program for accreditation of third-party auditors to provide the FDA with a more efficient tool to regulate food products.  Particularly, it assists the FDA in regulating food entering the United States via international trade, as it is recognized by the FSMA that the FDA is administratively and financially unable to ensure the safety of imported foods solely on its current system of border inspection.  Under the new program, the FDA would recognize accreditation bodies, which would in turn accredit third-party auditors.  These third-party auditors would then conduct onsite food safety audits in foreign jurisdictions and issue certifications for foreign food producers.  According to the FSMA and the proposed rule, an accreditation body can be a foreign government/agency or a private third party, and a third-party auditor can be a foreign government, foreign cooperative, or a private third party.  Both are required by the proposed rule to meet standards for legal authority, competency and capacity, impartiality/objectivity, quality assurance, and records procedures.

Will such a multilayer delegation structure result in dilution of accountability and effectiveness?

Congress -> FDA -> Accreditation Body -> Third-Party Auditor -> Producer

The FSMA seems to have created a regulatory dilemma for the FDA in terms of addressing imported food safety.  The dilemma results from a structural mismatch between the broad scope of power granted to the FDA and the long chain of delegation to foreign/private actors as primary “regulators.”  The FSMA instructs the FDA to delegate its regulatory authority to foreign governments and/or private third parties, aiming to largely increase the effectiveness of regulation along the global supply chain. However, the FSMA does not give the FDA adequate capacity to closely oversee such foreign/private regulatory agents along the delegation chain.  Thus, the FSMA cannot hold foreign/private regulatory agents fully accountable for their failures in ensuring food safety.

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By Ching-Fu Lin

At the World Trade Organization (WTO) committee dealing with food safety and other issues under the Agreement on the Application of Sanitary and Phytosanitary Measures (SPS Agreement) held approximately three weeks ago, China raised several trade concerns about the Food Safety Modernization Act (FSMA).  Other WTO members, such as Brazil, Belize, and Korea, supported China’s concerns.  One of the major points of contention was the FSMA’s import certification requirements and whether its outsourced third-party auditors will conduct food safety inspections in a manner consistent with the SPS Agreement.

Before we dig into the trade implications of the FSMA, two important questions must first be answered.  What are the FSMA import food safety requirements?  And what is the underlying rationale for such requirements?

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By Ching-Fu Lin

[See Part I here.]

In response to the melamine-tainted milk scandal in 2008, China replaced its outdated Food Hygiene Act with the Food Safety Law, which came into effect in 2009.  The 2009 Food Safety Law includes provisions on risk assessment methods, establishment of a food safety committee, mandatory product recall requirements, and unification of food safety standards.  However, this legal reform has left many key areas of the regulatory framework intact—such as industry compliance and law enforcement.

First, the crucial problem of overlapping competencies among responsible authorities is not addressed in the 2009 Food Safety Law.  Although the Ministry of Health (MOH) is mandated to take the lead on food safety regulation, the current state is flawed as multiple agencies are only organized in a loosely coordinated system.  For example, the State Food and Drug Administration (SFDA), the Ministry of Agriculture (MOA), the State General Administration of Quality Supervision, Inspection and Quarantine (AQSIQ), and the Ministry of Commerce (MOC) all take part in the regulation of the entire food supply chain.  The result is a fragmented regulatory environment, which creates blind areas for agencies to push responsibility away, and therefore, perpetuate rather than alleviate loopholes in routine control.  Thus, timely response and cooperation is difficult.

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By Ching-Fu Lin

Why should we be concerned about China’s food safety problem?  A recent opinion by Adam Minter on Bloomberg offers yet another tough criticism on China’s food system: “For more than a decade, China has earned a reputation as one of the world’s worst food-safety offenders.”  Melamine-tainted milk, rat meat sold as lamb, recycled “gutter oil” for cooking, and most recently, juice made from rotten fruit, Chinese food producers never cease to surprise us with their “creativity” in economic adulteration.  The Chinese government, however, has failed to establish an effective regulatory system beyond executing violators and political campaigns.  The Chinese consumers continue to react with desperation to these endless food safety crises, smuggling bunks of infant formula from Hong Kong and other countries.

But why should we care?

According to testimony before a subcommittee of the House Foreign Affairs Committee in May, food products of Chinese origin have dominated the U.S. food market in areas such as tilapia (77.5%), apple juice (65.2%), cod (52.7%), processed mushrooms (34.1%), garlic (27.4%), clams (16.1%), frozen spinach (16.0%), and salmon (12.7%).  The Chinese food imports are also expected to increase by about 10% annually until 2020.  Faced with the huge volumes of foods imported into the US every year, the Food and Drug Administration has only been able to inspect about 2.3% of the total imports from China in 2011 (which is, well, an improvement compared to 1.3% in 2007). Moreover, the U.S. Department of Agriculture announced last month that China’s poultry processing inspection system is equivalent to its US counterpart.  That is, processed chicken from China is determined as meeting US food safety standards (even if there are no on-site USDA inspectors in the processing facilities) and granted it access to the US market.

In an interdependent world trading system, regulatory failure in one country can spill over to many others, resulting in adverse public health repercussions in the latter country.  We should take China’s food safety problem seriously.

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