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) Licencing: Laws Governing The Food Industry

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) LICENCING

Laws governing the food industry:

The Indian food processing industry is regulated by several laws which govern the
aspects of sanitation, licensing and other necessary permits that are required to start up
and run a food business. The legislation that dealt with food safety in India was the
Prevention of Food Adulteration Act, 1954 (hereinafter referred to as "PFA"). The PFA
had been in place for over five decades and there was a need for change due to varied
reasons which include the changing requirements of our food industry.

The act brought into force in place of the PFA is the Food Safety and Standards Act, 2006
(hereinafter referred to as "FSSA") that overrides all other food related laws. It specifically
repealed eight laws which were in operation prior to the enforcement of FSSA:

 The Prevention of Food Adulteration Act, 1954


 The Fruit Products Order, 1955
 The Meat Food Products Order, 1973
 The Vegetable Oil Products (Control) Order, 1947
 The Edible Oils Packaging (Regulation) Order, 1998
 The Solvent Extracted Oil, De oiled Meal, and Edible Flour (Control) Order, 1967
 The Milk and Milk Products Order, 1992
 Essential Commodities Act, 1955 (in relation to food)
Need for the new act:

FSSA initiates harmonization of India's food regulations as per international standards. It


establishes a new national regulatory body, the Food Safety and Standards Authority of
India (hereinafter referred to as "FSSAI"), to develop science based standards for food
and to regulate and monitor the manufacture, processing, storage, distribution, sale and
import of food so as to ensure the availability of safe and wholesome food for human
consumption. All food imports will therefore be subject to the provisions of the FSSA and
rules and regulations which as notified by the Government on 5th of August 2011 will be
applicable.

Key Regulations of FSSA:

A. Packaging and Labeling:

FSSA provides for separate packaging and labeling regulations known as Food Safety
and Standards (Packaging and Labeling) Regulations, 2011 (hereinafter referred to as the
"Packaging and Labeling Regulations") which lay down the statutory and regulatory
requirements for packaging and labeling of products. A plain reading of the Packaging
and Labeling Regulations, show that there are different kinds of products: Pre-packaged,
Proprietary and other specific products as mentioned in the regulations.

Regulation 2.12 of the Food Safety and Standards (Food Products Standards and Food
Additives) Regulations, 2011 defines "proprietary food" as food that has not been
standardized under these regulations. Regulation 1 (8) of the Packaging and Labeling
Regulations defines "prepackaged" or "pre-packed food", as food, which is placed in a
package of any nature, in such a manner that the contents cannot be changed without
tampering it and which is ready for sale to the consumer.

The Packaging and Labeling Regulations provide the general requirements for labeling
of food products prescribed under the FSSA, as follows:

1. The particulars of declaration required under these Regulations to be specified


on the label shall be in English or Hindi in Devnagri script: Provided that
nothing herein contained shall prevent the use of any other language in
addition to the language required under this regulation.
2. Pre-packaged food shall not be described or presented on any label or in any
manner that is false, misleading or deceptive or is likely to create an erroneous
impression regarding its character in any respect;
3. Label in pre-packaged foods shall be applied in such a manner that they will
not become separated from the container;
4. Contents on the label shall be clear, prominent, indelible and readily legible by
the consumer under normal conditions of purchase and use;
5. Where the container is covered by a wrapper, the wrapper shall carry the
necessary information or the label on the container shall be readily legible
through the outer wrapper and not obscured by it.
In addition to these general requirements specified above, every package of food shall
also carry the following information on the label: (i) name of the food; (ii) list of
ingredients; (iii) nutritional information; (iv) declaration regarding veg. and non-veg; (v)
declaration regarding food additives; (vi) name and complete address of the
manufacturer; (vii) net quantity; (viii) lot/code/batch identification; (ix) date of
manufacturing or packing; (x) best before and use by date; (xi) country of origin for
imported food; and (xii) instructions for use.

Since a large variety of food products are being imported into India, under the
Packaging and Labeling Regulations, it becomes necessary to mention the country of
origin of the food on the label of food imported into India, and when a food undergoes
processing in a second country which changes its nature, the country in which the
processing is performed shall be considered to be the country of origin for the purposes
of labeling.

Therefore, the above are the statutory and regulatory requirements that are to be
complied with regard to labeling of products that are sold in the Indian market as "pre-
packaged goods".

B. Signage and Customer Notices:

Having briefly dealt with the statutory and regulatory requirements with respect to
labeling of products, it is necessary to understand the statutory and regulatory
requirements with respect to signage and customer notices more from the point of view
of a food outlet. It is important to note that though the provisions of FSSA do not
specifically provide for any statutory and regulatory requirements either for signage or
customer notices, but it has certain provisions with regard to advertisement of products
by food business operators.

Section 3 (1) (b) of FSSA defines the term "advertisement" (which includes a "notice") as
any audio or visual publicity, representation or pronouncement made by means of any
light, sound, smoke, gas, print, electronic media, internet or website and includes
through any notice, circular, label, wrapper, invoice or other documents.

Section 24 of the FSSA provides that no advertisement shall be made of any food which
is misleading or deceiving or contravenes the provisions, rules and regulations made
there under. No person shall engage himself in any unfair trade practice for purpose of
promoting the sale, supply, use and consumption of articles of food or adopt any unfair
or deceptive practice including the practice of making any statement, whether orally or
in writing or by visible representation which:

1. falsely represents that the foods are of a particular standard, quality, quantity
or grade-composition;
2. makes a false or misleading representation concerning the need for, or the
usefulness;
3. gives to the public any guarantee of the efficacy that is not based on an
adequate or scientific justification thereof, provided that where a defence is
raised to the effect that such guarantee is based on adequate or scientific
justification, the burden of proof of such defence shall lie on the person raising
such defence.
FSSA being applicable to all food business operators in India, the provision with regard
to advertisements would have to be complied with.

C. Licensing Registration and Health And Sanitary Permits

It is also important to note that FSSA, being the only legislation applicable to the food
industry throughout the country, will also apply as far as the national health and sanitary
permits are concerned.

The Food Safety and Standards (Licensing and Registration of Food Business)
Regulations, 2011 (hereinafter referred to as "License and Registration Regulations")
govern the aspect of license and registration of a food business operator.

Under Regulation 2.1 of the License and Registration Regulations, all food business
operators in the country are required to be registered or licensed in accordance with the
License and Registration Regulations, hence no person shall commence any food
business unless a valid license is possessed by the food business operator, and the
conditions with regard to safety, sanitary and hygienic requirements have to be complied
with at all times by them.
One of the prime purposes of these conditions is to ensure that the food business
operator maintains sanitary and hygienic standards as specified in each food category. It
is hereby recognized and declared as a matter of legislative determination that in the
field of human nutrition, safe, clean, wholesome food is indispensable to the health and
welfare of the consumer of the country.

It shall be the deemed the responsibility of the food business to comply with the
labeling, safety and health and sanitary requirements laid down in the License and
Registration Regulations. The labeling requirements are specified under the regulations
and they need to be complied with at all times especially with regard to pre-packaged
goods.

Penalties:

The FSSA provides for penalties in case of any non compliance. Generally, non-
compliance with various provisions of the FSSA may attract penalty of up to Two Lakh
Rupees (approx USD 4000). However, under Section 63, it provides that if any person or
food business operator (except the persons exempted from licensing under sub-section
(2) of Section 31 of FSSA), himself or by any person on his behalf who is required to
obtain license, manufacturers, sells, stores or distributes or imports any article of food
without license, shall be punishable with imprisonment for a term which may extend to
six months and also with a fine which may extend to Five Lakh Rupees (approx USD
9000).

Other Licenses:

The FSSA being a central act has to be complied with by all the food business operators
in the country. However, India being a big market, each state may have their local laws
which may also need to be complied with. Some of the other approvals and licenses that
a food operator may be required to obtain from various authorities under other laws
include: health and trade licenses from the municipal corporation of the relevant area,
environmental clearance, no-objection certificate for fire prevention and safety,
registration under the police act of the respective city/state, verification certificate under
the Standards of Weights and Measures Act, 1976 for each of the outlets issued by the
Department of Legal Metrology of the respective areas, registration under the shops and
establishments act of the respective state, eating house license and liquor license.

A license for playing music in restaurants is also required for playing recorded or live
music. It is mandatory for a food business to obtain insurance from any insurance
company with regard to public policy, product liability, fire policy, building and assets.
Other insurances though are not mandatory may be useful if taken.

Some of the other registrations and permissions may include registration under the
Employees' Provident Funds and Miscellaneous Provisions Act, 1952 if it is engaging
more than 20 employees. Registration is also required under the Central Excise Act, 1944
as in respect of goods specified in Third Schedule of the said act, repacking, re-labeling,
putting or altering retail sale price etc. will fall into the category of manufacture. Subject
to applicability, other statutory and regulatory compliances may also include
registrations under Income Tax Act, 1861, Customs Act, 1962, sales tax, service tax and
other labour laws.

Foreign Direct Investment in the Food Processing Industry:

Foreign Direct Investment (hereinafter referred to as "FDI") is permissible for all the
processed food products under 100% automatic route (except for items reserved for
micro, small and medium enterprises, where FDI is permissible under automatic route up
to 24%), subject to applicable laws/regulations/securities and other conditions.

Conclusion:

The preamble of PFA laid emphasis only on provisions for prevention of food
adulteration. FSSA lays emphasis on consolidating the laws related to food and to
establish FSSAI for laying down science based standards for articles of food and to
regulate their manufacture, storage, distribution, sale and import, to ensure availability of
safe and wholesome food for human consumption and for matters connected with them.
The new objectives clearly go far beyond the objectives of PFA. The strict penalties
imposed in FSSA may lead to increase in corruption, as enterprises may resort to unfair
practices to avoid these penalties.

The PFA dealt with countless Government ministries handling different food sectors as
per separate orders, like the fruit products order, and other orders related to vegetable
oil products, edible oils packaging, milk and milk products and meat food products,
which were issued at different points of time and were sometimes overlapping and
inconsistent. On the other hand, a unified act like FSSA enables unidirectional
compliance. The administrative control of the FSSA has been assigned to the Ministry of
Health and Family Welfare thereby establishing a single reference point for all matters
and eradicating any possibility of multiplicity of orders or the chance that any
coordination problems are caused.

Apart from the harmonization of laws relating to food quality and standards with
established international norms, FSSA aims at regulating food hygiene and safety laws in
the country in order to systematically and scientifically develop the food industry. Thus,
the food processing industry may see FSSA as a mixed blessing but the practical
application of this legislation, being at its nascent stage, will require some time to come
into full force

3) features
We produce some of the best Arabicas and Robustas in the country, in Washed and
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Our irrigation facilities can contain over 3.34 million


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4) product range
^ 0) overview

Tracing our roots to 1922, Tata Coffee is one of the largest integrated Coffee
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We are also home to some of the finest Indian Origin Pepper, intercropped
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Tata Coffee is a part of the Tata Group. Founded by Jamsetji Tata in 1868, the Tata
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5) features
Our Instant Coffee business uses coffee beans from multiple origins to customise
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