ZHAO Xu, Researcher, Unirule Development Research Center Guangzhou(UDRC)
The reason why it only took five years for the Food Safety Law to be amended has a lot to do with the imprudence when the law was passed. The Food Safety Law (Revised Draft) was passed by the Standing Committee of the National People's Congress in early July, and now the NPC Law Committee is collecting suggestions on this draft. However, this draft still has many problems. Hence, I would like to share my opinions on the draft.
The first thing I’d like to take about is the concept of food safety management, whether it is the market, or the government that should play a leading role in supervising the food safety. In the whole industrial chain of food production, management, and sales, four players are involved, namely, the food producer and manager, consumers, third-party providers of market place(including on-line market place), and the government. The former three players are of equal status before law, and they are equal market subjects. Therefore, a stimuli mechanism for food safety can be formed by market mechanism among the former three players, i.e., by the awards of the market (high sales volume or high price) as their products or services are recognized by the market, and by the punishment of the market(low sale volume or low price) as their products or services are not safe.
The logic of the market is that consumers tend to pay higher prices for the food that is considered more safe.(The indicators of food safety may be that the information of food is disclosed more thoroughly and complete, more traceable, with more credible supply chain.) In order to meet the consumers’ needs, retailers tend to procure food with safety guarantees from wholesalers. As it goes, every downstream player will impose requirements on their upstream provider, and this goes to the producers. As for the third party provider of market place, rules can be made (mainly food information disclosure regulations) in order to constrain the behaviors of them; or, standards of food information disclosure can be set up in order to cater to the needs of different food retailers in markets of different levels with different food safety requirements(for example, some food does not meet certain standards not because it’s not safe, therefore, it can be sold in a different market). The reason to have this arrangement is that it provides enough food safety information for the downstream retailers and consumers, but it leaves the right to choose to them at the same time. The relation between the three players and the government is between the governor and the governed, i.e., the government punishes any violation of the Food Safety Law. Apparently, no matter how big the government and the supervisory bodies get, it is impossible to oversee every single process of the transaction of food.
Recently, the central government proposed the fifth modernization which is the modernization of the concept of state governance, and it is a huge progress from “governance” to “management”. In regards with food safety, “governance” means all the interests of the players are encompassed- the interests of the government, supervisory bodies, food producers and sellers, consumers, market place, and various service entities, including associations and guilds which not only cooperate in order to guarantee the safety of food, but also compete and interact to form a whole ecosystem. As mentioned above, the interaction between these players can only be achieved by market mechanism except the relation between the government and the market subject. Therefore, market should be put in the first place in order to effectively manage the food safety issue. Market should play a leading role, while the government a supplementary one. However, the Food Safety Law (Revised Draft) still takes after the thinking of conventional food safety governance which does not emphasize the function of the market at all.[Page]
The second point I’d like to make is about how to let the market play the leading role in the food safety governance. There are two difficulties at the moment, one is that the producers are too dispersed and scattered, the other the information asymmetry. The latter is what the government supervision should deal with. As the food producers are dispersed and scattered of small scales, the market finds them hard to recognize, that’s why some producers are able to sell food of bad quality and then escape the punishment. Long term credibility cannot be established in this environment.
In recent years, as the land transfers are allowed, agricultural productivity is getting developed and of big scale, which has solved the first problem to some extent. At the same time, the government should encourage food producers to form associations and guilds in order to undertake self-discipline and self-governance, and to turn individual credibility into collective credibility. These associations and guilds can be vertical(such as guilds for fruits, including the producers, wholesalers and retailers of fruits) or horizontal(such as cooperatives, association of wholesalers, and association of retailers). These self-governing bodies can also bring in external experts, consumers organizations, and other third-party representatives to build up credibility on the basis of full and complete food safety information disclosure.
The third problem is how the government should supervise food safety. The suppression is two-fold, to supervise and to manage. To supervise is to collect information concerning food safety, and to manage is to make the decisions of prize or punishment according to the information collected. The problem of the current system is that the government “manages” too much, and the “supervision” is too weak, while he Food Safety Law (Revised Draft) aims to further stress the “management” part instead of the “supervision” part. The over-regulation by the government will take the place of the market which further leads to the misallocation of the responsibilities in regards to food safety. The market subject relinquishes its responsibility and relies on the government, while the government is not capable of undertaking effective supervision and shouldering responsibilities when accidents take place. The weak supervision makes it impossible to collect food safety information in time and accurately, and furthermore, this will on the one hand endanger the basis for “management”, and on the other hand makes it hard for market subjects to reach rational choices. Without the constraints of the upstream players by the downstream players, it is very difficult for the market to function well in regards to food safety.
Therefore, the amendment of the Food Safety Law should be strategic. More emphasis should be made to more “supervision” and less “management”. In order to enhance suppression, compulsory requirements for food safety information disclosure should be stipulated in the amendment that makes it specific on the subject of the disclosure, detailed requirements and procedures, and the accountability.[Page]
What’s worth noting is that the government should not monopolize the collection (including the examination and accreditation) and the disclosure of the food safety information. The reason is, on the one hand, such information is very important for the market, and on the other hand, the government has a strong intent in hiding such information from the public against the current backdrop in order to maintain the stability of the society, gain a good political record, or escape from being held accountable. Therefore, it is not appropriate that Article 118 of the Food Safety Law (Revised Draft) stipulates “no food safety information shall be disclosed without the approval of the food and drug administrative departments”.
In order to decrease the “management” by the government, the government should focus more on making the rules, oversee disclosure of information and determine punishment for wrongdoings, instead of directly getting involved in examination and accreditation of food safety, or undertaking massive examination movements. The government should allow the market to make its own choices on the basis of full information disclosure, while it maintains the role of a supervisor or a referee. Even in the supervision and management, these two acts can be divided. “Management” requires specific authorization by law and can only be undertaken by the government, while the process of “supervision” is a process of information collection, which can be outsourced to accredited third-party organizations. By doing so, the lack of professionalism of the government can be fixed, and as there is checks and balances, the monopoly and concealment of food safety information by the government can be solved.
Last but not least, I’d like to take about the misallocation of food safety obligations and the mismatch of power and obligations. The Food Safety Law (Revised Draft) does not clearly distinguish the obligations of all the relevant parties in regards to food safety. Let’s take a look at the obligations of the third-party provider of the market place.
Article 72 stipulates that “Certificates shall be issued and examined for the provider of the market place, the lessor of counters, and the organizer of trade fairs. Food safety obligations shall be clarified for the food venders, and routine periodical examinations shall be undertaken in regard to the business environment and conditions. Any violation of this Article shall be restrained in time and reported to the local food and drug administrations.” Here in this Article, the obligations of the providers of the market place, lessor of counters, and organizers of trade fairs are almost infinite, and the powers of them are merely the power to report to the “local food and drug administration”. There is a ridiculous mismatch of infinite obligations and very limited power.
If the mangers of the market place must take responsibilities, at least these responsibilities should be more clarified, such as more specific stipulation on the exact period of the “routine periodical examination”, the means of the examination, whether the managers are obligated to cooperate in the examination, and the consequences of noncooperation, and the proper recognition of compliance. As a Draft of the Food Safety Law, a change of conception and procedure is needed. Firstly, the role of the government in the governance of food safety needs to be defined, and the fundamental role of the market in the governance should be upheld.[Page]
That is to say, the amendment of the law should not only be based on the current system and from the single angle of the government regulations, but also take into account the possibility of systematic reforms. As the food safety governance is immature at the moment, systematic reforms in this regard should be encouraged by local governments. When their experience is collected and analyzed, it is time to amend this law, which will avoid the “periodical” amendment of basic laws. Besides, more experts, food industry professionals, consumers and third-party accreditation organizations should be brought in. The amendment of the law should not be for the political record, for escaping accountability, or for department interests.
Source: FT Chinese and China-Review |
