All e-commerce entities selling food products or running a food business will now have to get themselves registered with the Indian food regulator, Food Safety and Standards Authority of India (hereinafter referred to as the ‘FSSAI’). The regulatory authority has directed online retailers to register under the Food Safety and Standards Act, 2006, with the FSSAI. The FSSAI Chairman, Mr. Ashish Bahuguna, said that since the e-commerce players are selling food products or dealing in one or another form of food business at their platforms and since food and food businesses come under the ambit of FSSAI, so, they have register if they want to continue their food business operations. This would also allow FSSAI inspectors to do regular checks on the safety of the food products that the platforms deal with or store in their warehouses along with taking action in the cases of complaints. FSSAI has also asked e-commerce companies to display all details regarding food items on their portals clearly. This would include names and addresses of sellers, their license numbers, nutrition and ingredient information, food safety details and price parameters. This would ensure that the consumers are fully aware of what they are buying.
Without a registration, it would be ‘illegal’ for such companies to deal in food products or food businesses. As of now, there is no penalty for the non-compliance of the same but an appropriate action as per the food safety and standards law could be explored for violation.
Startups operating in food businesses like Zomato, Foodpanda and Swiggy, grocery delivery players like Grofers, Bigbasket and Peppertap and e-commerce giants like Amazon, Flipkart and Snapdeal will now be required to register with the regulatory body. FSSAI CEO, Mr. Pawan Agarwal, justified this move by saying that this will be in the interest of the e-commerce players. “By following the regulations of the Food Safety Act, the e-commerce players can ensure the quality of food products or even services to their consumers which will help these companies also”, he said. He added that their transactions are electronic but if they want to sell food products or dealing in the food business, then that will fall under ambit of the FSSAI. The FSSAI is not ready to accept that the e-commerce companies are only technology facilitators. The food regulator wants e-commerce entities to come under its purview just like state governments want them to take responsibility for the VAT payments.
The online distribution channel has been neglected with regard to food safety. In this regard, it has been noted that online shops are not necessarily subjected to inspection since sampling and analysis is often complicated as the provisions in FSS Act cannot be completely fulfilled in such business operations. FSSAI held a meeting with senior executives of the online companies in New Delhi on March 18, 2016, with respect to the new guidelines being planned.
FSSAI also plans to divide the online companies into two categories where the online marketplaces like Flipkart, Amazon and Snapdeal were being asked to get licensed under FSSAI, while the second category is being formed to address online food delivery companies which are being advised to facilitate business of food business operations who are FSSAI registered and licensed. FSSAI Chairman also stated that the aim of the move is to provide uniform safety to consumers on both online and offline channels. He said that such companies already fall under the Food Safety Act and, thus, should follow the provisions immediately.
The task will be very complex for sellers on the marketplaces. In order to make sure all the sellers are FSSAI registered and licensed will be a massive and complex process. Over the previous few months, online marketplaces have started selling various food products on their platforms.