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China Making Infant Formula Registration Rules

  •   10 Aug 2015
  •    Echo Cao
  •   4653  Views
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    China is currently drafting new regulations that when promulgated will effectively implement a “one brand, one formula” rule. The “registration of infant formula product guidelines” is currently being compiled by the CFDA. In addition domestic manufacturers are likely to be limited to producing no more than 5 IF brands. The regulation is likely to be released in Oct this year and will bring about tremendous changes to China’s domestic market which currently has over 2000 individual IF brands vying for market share and credibility. China’s new Food Safety Law (effective from 1 Oct) articulates the new registration requirement and briefly mentions applicants should provide the CFDA with R & D report and other supporting materials able to prove the formulation is both scientifically and nutritionally sound and above all safe. The pending  guidance is a subsequent implementation document for FSL. Moreover, the new FSL emphasizes the “one brand, one formula rule” and reiterates the ban on OEM production models. In contrast to the domestically manufactured infant formula market, there are only about 300 imported IF brands sold in China.

     

    Domestic

    Imported

    Number of manufacturers

    92 (approved by CFDA )

    71 (certified by China CNCA)

    Number of brands

    about 2000

    about 300

    At present the sheer volume of Chinese brands and lack of product diversity make it difficult for Chinese consumers to differentiate between quality products and cheaper generic “me-too” brands. Concentrating China’s diluted infant formula supply and establishing easily recognizable brands produced by China’s most technologically capable manufacturers is fundamental in consolidating market supply, generating consumer demand and building a competitive domestic sector. The move follows on from a series of regulatory measures which have been designed to erect prohibitively stringent technical and safety standards and consolidate supply into the hands of China’s top 10 dairy companies.

    In the past domestic enterprises have relied on creation of a large volume of brands which are marketed differently based on target city socioeconomic conditions. This strategy has proved useful in 3rd and 4th tier cities in China but has affected the integrity and stability of the domestic market. The new regulation will effectively put an end to this practice meaning brands that have been designed for specific regional areas will be hit hardest by the new regulation. Famous brands with an established national market presence will be less affected. 

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