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China's National People's Congress Passes Reshuffle Plan to Establish New Food and Food-Related Agencies
Thursday, March 22, 2018

On March 17, 2018, only five years after China implemented major changes to its food regulatory regime,1 China's existing food Agencies have been completely restructured. In particular, National People's Congress (NPC), China's national legislative body, has passed yet another major cabinet reshuffle plan, which will establish the following three new regulatory agencies:2

* State Market Regulatory Administration (SMRA)

* National Health Commission (NHC)

* Ministry of Agriculture and Rural Affairs (MARA)

The stated goal of this organizational restructuring by the Chinese government is to consolidate decentralized market regulatory forces and optimize regulatory resource allocation. Industry may benefit from more regulatory consistency following this consolidation, though it remains to be seen how these changes will play out at both the central and local levels. A general overview of the restructuring plan is provided below.

State Market Regulatory Administration (SMRA)

  • Both the General Administration of Quality Supervision, Inspection and Quarantine (AQSIQ), an Agency responsible for imported and exported food as well as the manufacture and import/export of food packaging materials, and China Food and Drug Administration (CFDA), an Agency in charge of food manufacture and distribution along with the State Administration for Industry & Commerce (SAIC), are incorporated into the newly established SMRA.[3] The new administration, which is affiliated with the State Council, will undertake various responsibilities, including food safety, business registration, anti-trust enforcement, industrial product safety, etc.
    • Importantly, AQSIQ's responsibility for import/export inspection and quarantine currently handled by AQSIQ's various subsidiary units (the "CIQs"), are transferred to the General Administration of Customs. In other words, customs will now be responsible for inspecting imported food and food packaging materials to verify compliance with the Chinese legal requirements. 
      • The Certification and Accreditation Administration (CNCA) and Standardization Administration of China (SAC), which were affiliated with AQSIQ, are now transferred to SMRA. However, the names of both CNCA and SAC will be retained. In this regard, CNCA is perhaps best known as an Agency approving overseas manufacturing facilities for foods exported to China (e.g., dairy products, meat products) as well as product certification (e.g., organic). Meanwhile, SAC is the agency formulating various Chinese Standards.
    • The Food Safety Commission of the State Council (FSC) will be retained, and its responsibilities will be handled by the new SMRA. FSC was established in 2010 to coordinate food management and significant food policies among different agencies. 

National Health Commission (NHC)

  • The National Health and Family Planning Commission (NHFPC) is being restructured to form the newly established National Health Commission (NHC), which will also incorporate certain health-related functions from other administrations. In recent years, NHFPC has been responsible for developing Food Safety Standards and conducting food safety assessment. There is no indication that NHC will be relieved of these responsibilities.

Ministry of Agriculture and Rural Affairs (MARA)

  • The new Ministry of Agriculture and Rural Affairs (MARA) will replace the Ministry of Agriculture (MOA).[4] The new Ministry will continue to carry out the responsibilities of the former MOA; these include the supervision of agricultural product safety and approval of agricultural genetically modified organisms.
  • While the institutional reshuffle may not lead to immediate and significant changes in food regulatory policies, its impact on many regulatory matters (e.g., potential delays in the promulgation of the Food Safety Law Implementing Regulation,[5] approvals of food petitions and Food Safety Standards, etc.) should not be overlooked. Although it may be several months - or even years - before the reshuffle is completed, we will continue to monitor these developments and provide relevant updates. 

1. See Keller and Heckman's article on the government reshuffle in 2013 athttps://www.khlaw.com/David-Ettinger-and-Eric-Gu-Author-Article-on-Chinas-Food-Safety-Regulatory-Regime-for-Food-Chemical-News

2.  http://www.npc.gov.cn/npc/xinwen/2018-03/18/content_2050371.htm

3.  The establishment of SMRA was announced on March 21, marking the launch of the reshuffle of food regulatory institutions. See https://www.thepaper.cn/newsDetail_forward_2036753

4.  Notably, similar postures have been adopted in Canada and South Korea, which have each established a "Ministry of Agriculture, Food and Rural Affairs" or "MAFRA."

5.   See Keller and Heckman's China Regulatory Matters discussing it at http://myemail.constantcontact.com/CFDA-Submits-to-WTO-the-Third-Revised-Draft-Regulation-on-the-Implementation-of-the-Food-Safety-Law.html?soid=1116651795207&aid=Sa6S0vtKLHs

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