Mar 4, 2013

Alcohol manufacturers may move court over unacceptable licensing rules

The standards set for licensing and registration under the Food Safety and Standards Act (FSSA), 2006, by the Food Safety and Standards Authority of India (FSSAI), the country's apex food regulator, are not acceptable to alcoholic beverage manufacturers.

The head of an Indian trade body representing multinational alcohol brands has termed the licensing and registration norms proposed by FSSAI and the proposal to set nationwide alcohol limits in beverages a waste of time, adding that it would create good governance issues.

State excise departments will not have a problem with the new licensing and registration procedure and there will be no clash of interest between them and FSSAI, in which the powers to pull alcohol manufacturers and those in the beverage industry up have been vested.

Apart from licensing and registration from alcohol manufacturers, wholesalers, suppliers and traders, FSSAI has set draft standards for the whole spectrum of alcohol beverages (defined by the Act as food) to set the maximum permissible alcohol limits on the grounds of public safety.

One of the opponents of FSSAI's licensing and registration standards for the alcohol industry is Pramod Krishna, president, Confederation of Indian Alcoholic Beverage Companies (CIABC), which represents Diageo, Bacardi, Martini and Beam Global.

He said, “We will take legal action to stop FSSAI from regulating alcoholic drinks. In relation to FSSAI's regulations, we have filed a writ in the Bombay High Court, because the Constitution mandates that alcoholic beverages are a state subject.”

“And for all practical purposes, they are governed by the excise laws of the states. If FSSAI comes into the picture, all the players in the alcohol industry would be harassed and would face a lot of problems,” Krishna added.

He added, “The Food Safety and Standards Act, 2006, was implemented by the health ministry, and our concern was that if our industry had two regulatory authorities, it would create problems of good governance.”

Rushabh Bhayani, partner, Nagindas Hiralal Bhayani, informed, “We are not at all aware about FSSAI's licensing and registration for the alcoholic beverage industry. But we are already under the state excise department's regulations. Regulations by other bodies will create chaos for the alcohol industry.”

Although FSSAI is ready to bring all FBOs selling alcoholic beverages under the purview of licensing and registration, most FBOs have not obtained licences or registered, and are vehemently opposing the standards laid down by the apex food regulator.

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