PERPETUAL LICENSES: An Epoch of Advancement for the Food Industry

PERPETUAL LICENSES: An Epoch of Advancement for the Food Industry

In the modern era, the popularity of food aggregators and delivery platforms is mounting at a high pace. Therefore to provide more ease in doing business, the Food Safety and Standards Authority of India (FSSAI) in its 28th meeting, which was conducted on 21.05.2019, after the approved in-principle have decided to amend its Food Safety and Standards (Licensing and Registration of Food Businesses) Regulations, 2011. The said regulations have finished eight years of implementation. The ultimate aim behind amending the existing rules is to substitute the current year to year licensing requirement with a one-time license known as a Perpetual License.

The Food Safety and Standards Authority of India (FSSAI) is an autonomous body, formulated under Food Safety and Standards, 2006. It amalgamates several acts & orders that have till now handled food-related issues in various Ministries and Departments. FSSAI has been formed to lay down science-based standards for food articles and to regulate their manufacture, distribution, storage, sale, and import to guarantee the availability of safe and wholesome food for human consumption. Further, the authority is also responsible for safeguarding and promoting public health through the regulation and supervision of food safety.

By amending the prevailing rules and regulations, the Food Safety and Standards Authority of India (FSSAI) are moving forward to make these licensing requirements compulsory for digital food business operators (FBOs). Food Business Operators (FBOs) comprises of Zomato, FoodPanda, UberEats, Swiggy, and the yet-to-launch Amazon Prime Now service. This change could simplify the licensing regime for food companies and by this means, help them to improve their ease of doing business.

According to Mr, Pawan Agarwal, CEO, FSSAI, the amendments in the licensing and registration regulations are being proposed to streamline and simplify the rules, bring in more transparency for stakeholders and ease the procedures for obtaining new licenses. He added that there is a need to shift our focus from the renewal of licenses to effective compliance of the regulations by food businesses.

The authority has also decided to define the food businesses, particularly those running multi-city chains as ‘Brand Franchiser’, to make sure that their restaurants and brands follow the licensing rules and regulations. Further, it would also guarantee that the aggregators functioning with such franchisers are not liable for any non-compliance by the food zones, partner restaurants, and eateries. Here in it means that the Cloud Kitchens are likely to be recognized as Brand Franchisers.

As per the proposition, based on the e-filing of an annual declaration by registration holders and annual returns by license holders, the perpetual licenses will be provided to food business operators (FBOs). Annual returns will be a report of their annual turnover, product testing protocols adopted among other details which will facilitate FSSAI to discover that they comply with the regulations.

At present, Food Business Operators (FBOs) take licenses for 1-5 years while Petty Food Businesses with turnover up to ₹12 lakh are required to register with the authority. Further, the food delivery platforms also rely on central licenses, state licenses for getting themselves registered. So, these amendments will now make possible for the food safety authority to make sure that food delivery platforms are complying with all FSSAI rules, regulations, inspections, third party audits, and food testing processes. Additionally, this will also help the authority to keep a check over the complete process and also bring about the transparency in its functioning.  Lastly, with this online declaration, the authority will also have a record and details of the appointment of skilled, trained and qualified food safety supervisors with the business.

E-Commerce Food Business Operators

The Food Safety and Standards Authority of India (FSSAI) is also looking forward to bring new-fangled business models such as E-commerce FBOs (like FoodPanda, Zomato, UberEats, Swiggy) and Brand Franchisors among others under the purview of the licensing regulations.

While the regulator has already directed E-commerce Food Business Operators (FBOs) to take FSSAI licenses, this will now be officially introduced in the licensing regulations through the proposed amendments. Likewise, to put more onus on the food brands or restaurants towards adherence to regulations across their franchise system, the expression “brand franchisor” is also being included.

Online Licensing System

To provide the aggregators and users, digital experience and visual appeal, the authority has also decided to unleash an online licensing system to make the FSSAI license registration process easy and straightforward. Further, the authority has also agreed to amend the ongoing fee structure charges for licenses and registrations, simplifying new registration and licensing applications procedure, in addition to the alignment of regulatory requirements for licensing and registration as per the nature of the business.

According to Ms Rita Teotia, Chairperson, FSSAI, the Food Safety Compliance System is under process, and the said advancement in the online licensing system will provide enhanced interfaces and improved speed to the applicants of License or Registration. Moreover, within two months, the public would be able to access the online licensing system.

This system will also embark upon the day to day issues dragging into the prevailing system such as frequent shutdowns, a slow server, and inability to link with other online systems, non-availability of customized management information system (MIS) reports and no longer accessibility of technological support for maintenance of the system, etc.

Further, as per the rules and regulations, the FSSAI License/ Registration will also be linked with the food products standards. Hence, this would help the Food Business Operators (FBOs) in selecting their products and in bringing transparency in the field while enforcing the Food Safety Standard Act, 2006.

It is pertinent to mention that all the regulations concerning online payment for License/ Registration have already been made available all over the country with effect from 08.11 2019.

Ms Rita Teotia further mentioned that FSSAI is also in the course of engaging an expert consultation on the development and advancement of the Food Safety Compliance System (FoSCoS). The expert’s consultation would provide an independent outlook to the system, which will help in designing a state-of-art system for the stakeholders. It is noteworthy to mention herein that the view for developing the Food Safety Compliance System is to level it up according to amended regulations. Lastly, to build harmony with the notification of revised rules, FoSCoS (Version 2.0) will be unleashed.

Conclusion

All the advancements and developments made by the authority is a step forward after chain of complaints against aggregators for listing sub-standard restaurants and for delivering low-quality food. Last year, FSSAI had asked ten such companies, including Swiggy, Zomato, Uber Eats, Food panda, and Lime Tray, to delist unlicensed eateries and restaurants.

Further, these amendments will provide more ease to the food aggregators and various delivery platforms in doing business, as from now, they only need a one-time license instead of year to year licensing requirement.

 

About SHIVANI

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This author is Shivani Jain, working as PR Associate and Content Creator with Enterslice Ites Private Limited.

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