James Cheng
On January 12, 2016, the Chinese Government Network issued the Opinions of the General Office of the State Council on Accelerated Promotion of the Creation of a Tracing System for Enterprises in Manufacturing and Operating Specific Key Products (Guo Fa Ban [2015] No. 95; hereinafter, the “Opinion”) to prompt manufacturers and operators to quicken their pace in creating a tracing system, focusing specifically on seven major categories of products such as edible agricultural products, foods, medicine, agricultural production materials, special equipment, dangerous goods and rare earth products.
According to the Opinion, the so-called “creation of a tracing system” means the creation of effective measures to gather and record information about the production, distribution and consumption of products for realizing the goals of traceable sources, traceable product flow, accountability, and enhanced quality and safety management and risk control for the entire process.
Currently, the laws and regulations that cover products which have a major impact on the lives and properties of the public and overall public safety include the Food Safety Law, the Law for the Quality and Safety of Agricultural Produces, the Pharmaceutical Administration Law, the Law for the Safety of Special Equipment and the Regulations on the Safety Administration of Explosives for Civilian Use, etc. The Opinions specifically require all ministries and commissions, as well as local governments, to plan the creation of a national tracing system for important products based on the above laws and regulations.
Regarding the creation of a food tracing system, the Opinions specifically state that it would focus on baby formulas, meat and dairy products, edible plant oils and white wines, thereby urging and guiding producers to set up a quality and safety tracing system pursuant to law for such foods and substantially take responsibility for their quality and safety. The tracing system will be extended to cover the raw material supply element of foods so that the tracing administration may be implemented across the entire industry chain.
With respect to the creation of a tracing system for special equipment and dangerous goods, the Opinions specifically focus on products such as elevators and gas cylinders. There is a focus on strictly implementing a safety technology archive management system for special equipment by encouraging enterprises to dutifully record information regarding the manufacture, service and maintenance of elevators and the manufacture, filling and inspection of gas cylinders to create a safety management tracing system for special equipment.
With respect to enhanced liabilities of enterprises as principals, the Opinions encourage enterprises to collect and retain information via technical means such as the internet of things and to create an information-based tracing system. Distribution enterprises such as wholesales, retail and logistics operators should fulfill their key functions in the supply chain and drive production enterprises to jointly create a comprehensive information-based tracing chain. E-commerce enterprises are required to be closely linked with offline enterprises and create an integrated online and offline information-based tracing system based on unified coding technologies. Foreign enterprises are required to create an integrated import and export information-based tracing system that meets domestic and foreign market needs.
The Opinions also provide policy support for an enterprise’s development of a tracing system by measures, such as encouraging financial institutions to provide loans and product liability insurance, or prioritizing traceable products in government procurement with all else being equal.