At a recent press conference called by the Indian Drug Manufacturers’ Association (IDMA), the association urged manufacturers and food business operators (FBO) across India not to pay money to the Food Safety and Standards Authority of India (FSSAI) for product approvals. They also spoke about the fight against the regulator on product approvals and the Mumbai High Court judgment quashing them.
Dr R K Sanghavi, chairman, nutraceutical sub-committee, IDMA, informed, “Even after the stay by Mumbai High Court, the ambiguous scheme of product approval is still causing harm to the dietary supplements, health supplements, functional foods and nutraceutical industry.”
“FSSAI introduced the scheme in 2012, and since then its guidelines have been changed eight times, the last advisory was bought in May 2013. The quashing of product approval by the High Court is a very good move, but FSSAI is not clarifying their stand which is making us lose business to the tune of crores,” he added.
An importer, on the condition of anonymity, said, “The High Court gave the judgment in our favour, but the FSSAI is not allowing us to do our business in a right way. They are always harassing us by one new advisory or another.”
“The High Court quashed FSSAI product approval advisories, terming it unlawful. But port authorities demanded the product approval from importers of dietary supplements and nutraceuticals. The authorities are refusing to send the landed products for testing without the product approval, and as a result, no clearance is being made for the import of goods in India,” he added.
The importer added, “Two years ago, we filed for the product approval application, but FSSAI officials did not revert. The authorities has neither been processed, nor rejected or accepted.”
“And due to this, our business has been affected by 70 per cent. The imports of our product have completely stopped since September 2013, and the reason we are struggling to stay afloat with the sale of old insufficient stock,” he said.
“We have all the necessary licences required to import and to do business as per the High Court order, and we should have been allowed to run our business during this period, but FSSAI is not permitting us to do it,” the importer added.
“Meanwhile, senior IDMA officials asked all the manufacturers and FBO to carry on their business without any fear, and not to pay to FSSAI on demand for product approval has been stopped since September 2013, and we are struggling to stay afloat with the sale of old insufficient stock,” he stated.
“We have the necessary licence required to import and do business, and as per the stay order, we should have been allowed to run the business during this while,” the importer added.
India is a fast-growing market of nutraceuticals and dietary supplements owing to the increase in life expectancy, and a subsequent increase in lifestyle diseases.
The industry is expected to grow rapidly in next ten years (according to a Federation of Indian Chambers of Commerce and Industry [FICCI] and Frost and Sullivan report in 2010). Yet, Indian players are suffering huge losses with many forced to shut down their businesses.
A large number of FBO are also exporting nutraceuticals and dietary supplements to developed markets like the United States and Europe, where there is no such a product approval system, however, are adversely affected by the uncertain regulatory regime in India.
Leading industry associations, after making several representations to FSSAI officials, intense discussions with its own members and open conferences with the stakeholders, have found no direction or definite solution from the authorities on the issue of product approvals.
FBO, however, through their associations are determined to find an effective way to resolve the prevailing issues and demand an independent body to help the cause.
Background
The Food Safety and Standards Act (FSSA), 2006, was implemented in August 2010, and the FSSAI has framed regulations, covering food products in August 2011.
In January 2012, FSSAI introduced a product approval system, directing all FBO to obtain product approval before applying for the licences under the new Act.
The new Act provided automatic transition of existing licenses under the earlier regime of Prevention of Food Adulteration Act (PFA), 1954, but the Regulations issued in 2011 provided for a one-year time limit. This time limit has been extended several times, with no conclusion.
It appears from these advisories that the initial thought was only to limit the requirement of product approval for novel foods that contain ingredients, which are introduced for the first time in the country or which do not have a history of safe use.
However, the scope of advisories was extended to cover all categories of products which were not standardised, even if they were old and established in the market.
Most FBO, including those who were producing proprietary foods for a long period of time, have applied for product approval by paying Rs 25,000 for each product applied, in order to transfer the licences of existing products under erstwhile licenses and regime to the new one.
However, due to the lack of clarity in implementation and the criteria adopted for such approvals, many FBO have been facing significant problems. A majority of them have not received the product approval or no-objection certificate (NOC) despite having applied for it over a year ago, thus making them unable to apply for licences.
Following this, a writ petition was filed in Bombay High Court against the advisories of product approval issued by FSSAI, for which the proceeding is on.
So far, FSSAI has been unable to justify whether this power to release advisories has been passed before both the Houses of Parliament or not.
Such arbitrary Acts by the food authorities has adversely affected various sectors of food industry, especially in the states like Maharashtra, Gujarat, Karnataka, Madhya Pradesh, Himachal Pradesh and Tamil Nadu.
The adverse effect has particularly been amplified due to interrupted operations in lieu of ultra vires advisory leading to poor economics of the industry causing shut downs and labour layoffs.
In the interim, on January 31, Bombay High Court stayed the product approval advisory dated May 11, 2013 for a period of four weeks, commencing February 4.
While the High Court extended the period for conversion of old licences by a period of eight weeks, FSSAI, in its recent advisory, extended the time period by six months (till August 2014).
The Supreme Court recently refused to lift the stay on the Centre’s new legal regime, under which the food regulator was authorised to issue guidelines requiring manufacturers to take approvals for the products already in the market.
A bench, comprising Justices J S Khehar and C Nagappan, declined a plea by FSSAI to modify the restraint order passed by Bombay High Court, which had stayed the advisory issued on the subject.
According to the May 2013 advisory, food products covering a broad spectrum, including “novel foods, functional foods, food supplements, irradiated foods, genetically-modified foods, foods for special dietary uses or extracts or concentrates of botanicals, herbs or of animal sources” should apply for product approval.
“After perusing the petition and hearing the arguments, we don’t find any ground to interfere with the interim order, and hence the prayer against the impugned order is rejected,” said the bench, adding that the High Court should make all endeavours to expeditiously dispose of the petition.
Appearing for FSSAI, senior advocate Paras Kuhad pointed out that owing to the blanket stay order, the authority was handicapped in examining any food product.
“This order is affecting the entire industry. The entire food safety mechanism is rendered ineffective and the authority cannot verify any food product,” he argued.
Kuhad added that FSAAI has now decided to extend the deadline for product approval and licensing to August 31, and the manufacturers could avail this remedy without waiting for the outcome of the petition.
The bench however maintained that the High Court order was only an interim order, adding that the validity of the advisory was still to be finally adjudicated. It asked the government to wait for the final order of the court and refused to modify the interim directive.
While hearing petitions filed by Vital Nutraceuticals and IDMA against the advisory, a two-judge bench of the Bombay High Court had initially delivered a split verdict on whether the FSSAI had the power to issue guidelines requiring existing manufacturers to take approval for products that are already in the market.
One judge on the bench held that such approval for products that are already in the market was unconstitutional, but the other differed and stated that the right to safe and uncontaminated food was held to be a fundamental right under the Constitution.
The matter was then referred to a larger bench of the High Court, which was seized of the issues pertaining to the legality and validity of the impugned advisory.
