Why just Good Intentions are often Not Enough

It is said “Good intentions are not enough. They've never put an onion in the soup yet.” ( Sonya Levien)

The recent Supreme court judgment quashing the ‘Product Approval’ procedure(for marketing food products in India) has shown that when it comes to law making,  having just good intentions is not enough; the law has to be drafted carefully and has to be followed diligently - if we are serious about what we intend to do. This is particularly important when you want to make a law to control the destiny of a ‘multi -billion dollar’ food business in India .The law cannot be arbitrary. The government and FSSAI (Food Safety and Standards Authority of India) will have to find a way out of the impasse created by the “not so perfectly” drafted Food Act and Regulation.

Under the earlier regime, product approval was required only if there was a new ingredient or additive being introduced. But the May 2013 notice broadened this to cover all products even if they were using approved ingredients or additives within permissible limits.

According to this new Product Approval ‘advisory”(issued in May, 2013) FSSAI required manufacturers to take approval for a broad spectrum of food products 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”. With every product approval application ,the FBOs (‘Food Business Operators ‘ a new term in the Food Act to describe Food manufacturers /marketers )were supposed to enclose an amount of Rupees 25,000/per product as processing charges Every FBO was expected to submit Efficacy ,Safety ,toxicological data for every product, irrespective of the fact that the product was available in the Indian market for decades.

Thousands of”Product Approval “applications with massive data were sent to FSSAI. It was supposed to issue either a ‘Product Approval’ or at least an NOC (no objection certificate).FSSAI did not have the infrastructure or required manpower for handling such a huge quantity of product approval applications.FBOs had to wait for months and sometimes even years without getting any definite communication from FSSAI.  A much bigger task than what FSSAI anticipated or could handle. A classical case of biting off more than one can chew! This created a massive confusion and the food manufacturers and marketers were absolutely at the mercy of the FSSAI

Food Industry was desperate and felt that someone had to bell the cat! But who (FBO) has enough courage to do a ‘dangerous’ job and antagonize the FSSAI? At last, the advisory was challenged by Maharashtra-based Vital Nutraceuticals based in Ambernath, (and subsequently supported by Indian Drug Manufacturers' Association (IDMA). The advisory was challenged at Bombay High Court.

A two – judge bench of the Bombay High Court comprising Hon. Justice V M Kanade and Hon. Justice Girish Kulkarni had delivered a split verdict on the same. The Chief Justice had to then refer the matter to Justice RS More as to whether the FSSAI had the power to issue guidelines to existing manufacturers requiring them to take approval for products that already existed in the market. The final order delivered on 30 June, 2014 , read by Hon. Justice RS More, set aside the May 2013 FSSAI advisory insisting on a Product Approval.The HC finally held that the advisory to manufacturers had no force of law and the authority had no power to issue the impugned communication .As per the Food safety and Standards act, any regulation meant for regularizing food products in any way should be done as per the prescribed procedure of the Act and the same has to be ratified by the two houses of Parliament.

This is what the conclusion of Hon.Justice More “In the light of the above discussion, I hold that the impugned advisory i.e. the product approval advisory dated 11th May, 2013 issued by respondent No.2 has no force of law and is not within the ambit and scope of the power conferred on respondent No.2-Food Authority under the provisions of the FSS Act, the Rules and the Regulations framed there under. Further it is held that respondent No.2 – Food Authority had no power and authority to issue the impugned advisory on Product Approval under Section 16(1), read with section 16(5), read with sections 18 and 22 of the FSS Act, without following the procedure laid down under Sections 92 and 93 of the Act of placing the Advisories/Regulations before both the Houses of Parliament.”

FSSAI filed an appeal in the Supreme Court against the Bombay High Court order invalidating “Product Approval”

Senior counsel L Nageswara Rao, Kapil Sibal and counsel Dheeraj Nair, appearing for Vital Nutraceuticals , at Supreme Court ,argued that the FSSAI does not have the power to issue advisories without resorting to the procedure of framing regulations as prescribed under the Food Safety ad Standards Act 2006. To ensure safe food and eliminate danger to human life, the mandate of the FSSA Act was to lay down the scientific standards for the grant of product approval to food products for which standards are not in existence. At present, there are 377 existing standards for various food products described under the Food and Standard (Food Products Standards and Food Additives) Regulation 2011 which cover approximately 90% of food consumed in the country.

Section 22 of Food Safety and Standards Act, 2006, enacts an absolute prohibition against the manufacture, sale or import of novel food, genetically modified articles of food, irradiated foods, nutraceuticals, health supplements, proprietary foods etc except as provided under the law. The FSSA used to grant ‘product approval’ on a case-to-case basis for food items falling under Section 22, which included products which were not naturally occurring foods but foods produced in a novel method.

The Supreme Court on Wednesday ,August 14 th,2015 upheld the Bombay high court decision last year quashing an 11 May 2013 advisory issued by the Food Safety and Standards Authority of India (FSSAI) on the procedure of product approvals .The apex court bench comprising justicesHon. J.S. Khehar and Hon Justice. N.V. Ramana said that there was no ground for interfering with the Bombay high court’s verdict and dismissed FSSAI’s appeal.

The bench of Hon. Justices JS Khehar and NV Ramana agreed with the High court and asked FSSAI to get the government to change the regulations instead of fighting the issue in court. "The food authority cannot say this is a bad product and list it as a bad product because it doesn't like a product. There have to be reasons for it. Where is the authority (in law) for you to do this? We can't leave it to one person or authority. We have seen it can be misused," Justice Khehar said in response to arguments by FSSAI that the regulator was well within its powers to issue such an advisory.. "Just as we have to ensure that you act, we also have to ensure that no improper action is taken," Justice Khehar said.

The SC order gives big relief to drug and health product makers in India including big Companies and top food and beverage companies such as Coca-Cola, PepsiCo, Nestle, Britannia and Hindustan Unilever. This comes close on the heels of the Bombay HC last week striking down the central food safety regulator’s ban on manufacture and sale of Maggi noodles, made by Nestle India, on the grounds of violation of principles of natural justice

In another significant development, National Joint Action Committee has been formed by nine food and allied industries bodies to highlight the issues that they have been facing by launching a nationwide agitation against FSSAI soon. To begin with, the committee has demanded refund of Rs 80 crore charged by FSSAI towards Product Approval application charges from traders when the system was in vogue prior to the Supreme Court order against it.