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China to champion food safety liability insurance

By Andrew Schreiber , 15-Jul-2014

China to champion food safety liability insurance

China’ s Food and Drug Administration has revealed that it is working on a food-safety liability insurance programme in high-risk industries, such as those involving dairy and meat products.

According to a report in the China Daily, for this purpose, Chinese lawmakers have introduced a draft amendment to the Food Safety Law, which has been reviewed by the national legislature.

As per the draft amendment, the China Food and Drug Administration (CFDA) and the China Insurance Regulatory Commission will jointly formulate the regulation on the liability insurance programme.

Xu Jinghe, director of legal affairs for the CFDA, said at a recent seminar on the food safety law that liability insurance could help increase supervision by insurance companies over food companies.

He revealed that the CFDA is considering suggestions from some legislators on implementing the insurance programme based on different food industry categories.

However, there are differences of opinion between the food and drug regulator and insurance companies on which categories the insurance should cover first, the report said.

We believe that the insurance should first cover high-risk food categories, while the insurance companies believe we should start with low-risk ones,” Xu said.

Chen Xu, deputy director of legal affairs for the CFDA, said the draft amendment to the food safety law did not make the food safety liability insurance programme compulsory because legislators took costs into consideration.

A compulsory program would increase costs for to food companies, and ultimately the costs would be transferred to consumers,” he told China Daily.

As per the report, there are suggestions from some stakeholders for tax incentives to be given to enterprises, which choose to acquire food safety liability insurance. However, no consensus has been reached between various government departments on this.

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