Industry Argues Against China’s Infant Formula Registration

It’s been over 2 months since the publication of the draft of Administrative Measures for Registration of Infant Formula Formulations (see CL food news on 2 Sep 2015). No further developments or announcements have been released by CFDA so far. CFDA officials are currently consolidating all comments submitted by the industry during the public consultation period but there are still disputes over the contents of the draft registration rule among industry revolving around the following points:

Differentiating IF formulations with 6 optional ingredients

The draft stipulates that a manufacturer of one or more infant formula brands (each brand having 3 stages - 1,2,3) must show significant differences in at least 6 optional ingredients between each distinct brand using the National Food Safety Standard GB 10765-2010 & GB 10767-2010 as the formulation reference in addition to providing scientific evidence supporting the use of these ingredients. However, according to Wang Dingmian a Chinese dairy expert China’s main reference standard is already very restrictive which will make product differentiation extremely difficult.

Manufacturers Limited to 5 Individual Brands

There is also the possibility that CFDA will limit manufacturers to manufacturing a maximum of 5 sets totaling 15 distinct formulations, each of which should have clear differences in ingredients. Unfortunately the draft does not specify whether subsidiary companies can apply for registration. As of 2 Nov 2015, CFDA has approved 104 domestic infant formula manufacturers in total, some of which have several subsidiaries. If no subsidiary restrictions are set, companies with more subsidiaries will have an obvious advantage. Mr. Wang suggested that the application should be made in the name of the group instead of its various subsidiaries and then groups can individual allocate registration quotas amongst its subsidiaries.

Registration requirement extended to imported products

Currently, the draft only covers domestic IF companies. According to china dairy industry expert Song Liang, there are over 2000 brands on the Chinese market and at least half of them are OEM brands from overseas. If imported products are not required to comply with registration requirements, more domestic companies will look to cooperate with overseas OEM manufacturers. Mr. Song proposes that all IF products that are circulated within China should be subject to the registration rule. CFDA and AQSIQ have both confirmed this upcoming requirement will indeed be extended to imported products (see CL food news on 22 Sep 2015).

Excessive IF Labeling Requirements

In the draft, IF products containing imported milk powder and base powder are required to have country of origin labeling. Infant formula made from goat milk (powder) should indicate the ratio of goat milk (expressed as powder per 100g), as well as the source of whey protein. These rules are designed to strengthen consumer information rights. Additionally, it also bans the use of labeling claims associated with functional, therapeutic or medicinal claims. This provision is helpful in preventing companies from exploiting consumers using exaggerated advertising and promotions but also suffocates the R&D activities of companies.

Due to the new pending regulation, a number of brands would be kicked out of the market after it is implemented. IF traders are puting infant formula products on clearance sale to reduce the stock as many as possible in recent months (see CL food news on 5 Nov 2015).

It still would take a several more months before the infant formula registration rule is finalized. During the 2015 China International Dairy Industry Conference Wang Ping from the CFDA stated that a guidance document outlining the practical compliance details will also be released. The guidance will further specify requirements for formulation R&D, whole-process production, quality control and testing and labelling, etc.