Legal Compliances for E-Commerce Food Business Operators

India has witnessed a sudden growth in E-commerce or online food businesses. Favourable lifestyle changes, digitalisation, ease of ordering, quick delivery, affordable rates are major factors that have resulted in an explosion of e-commerce food businesses. Some of the major players in the e-commerce food business scene in India are Zomato, Swiggy, FoodPanda, Big Basket etc. which have revolutionised the consumers’ access to food and this has resulted in growth of existing food businesses.

Laws Specific to Food Businesses in India

Following laws are specific to all food businesses in India:

1. Food Safety and Standards Act, 2006
2. Food Safety and Standards (Licensing and Registration of Food Businesses) Regulations, 2011
3. Food Safety and Standards (Packaging and Labelling) Regulations, 2011
4. Food Safety and Standards (Food Products Standards and Food Additives) Regulations, 2011
5. Food Safety and Standards (Prohibition and Restrictions on Sales) Regulations, 2011
6. Food Safety and Standards (Contaminants, Toxins and Residues) Regulations, 2011
7. Food Safety and Standards (Laboratory and Sample Analysis) Regulations, 2011
8. Provisions in the Indian Penal Code on Food Adulteration
9. Standards of Weights And Measures Act, 1976

The absence of specific mechanisms to check the quality and safety of the food listed or made available on E-commerce food business portals or platforms had raised serious concerns amongst customers, therefore in an attempt to regulate the activities of the E-commerce FBOs and to ensure quality and safety of the food and in consumer interest, the Food Safety and Standards Authority of India (FSSAI) has in February 2017 formulated and enforced Guidelines for operations of E-Commerce FBO in pursuance of the Food Safety and Standards (Licensing and Registration of Food Business) Amendment Regulations, 2018. These guidelines are applicable all E-commerce FBOs that carry on any activity in relation to manufacture, processing, packaging, storage, transportation, distribution and/or import of food and it also includes food services, catering services, sale of food or food ingredients.   

Food Business, Food Business Operator (FBO) and E-commerce Food Business Operator (E-Commerce FBO)

The term food business is defined under the Food Safety and Standards Act as an undertaking (either private or public) which carries on any activity in relation to manufacture, processing, packaging, storage, transportation, distribution and/or import of food and it also includes food services, catering services, sale of food or food ingredients.   

A Food Business Operator (FBO) is a person or business that either carries on and/or owns the food business and is responsible for ensuring the compliance required under the law. 

An E-commerce FBO is simply an FBO carrying on food business through the medium of E-commerce. 

Business Models of E-commerce FBO

The Guidelines mention four major e-commerce FBO models:

(a) E-commerce FBO providing listing services, i.e. an FBO who only provides a platform for the customer and sellers, brand owners, manufacturers, restaurants to interact. It does not undertake any activity defined as food business but curtails its function to providing a listing platform.   

(b) Sellers, brand owners, manufacturers, vendors, importers, processors, packagers or manufacturers who display or offer their food products, including food services, catering services, sale of food or food ingredients for sale to customers on an e-commerce platform. 

(c) FBOs operating and providing storage and/or distribution services to the sellers/brand owners, vendors, importers or manufacturers off the food products listed on their e-commerce platform.

(d) FBOs providing transportation services to the sellers, brand owners, vendors, importers or manufacturers of the food products and/or providing last mile delivery transportation to the end consumers. 

STATUTORY COMPLIANCES FOR AN E-COMMERCE FOOD BUSINESS OPERATORS

E-commerce FBOs are required to comply with the following rules:

1. All the FBO Models specified under clause b, c and d above are required to obtain a license from the Central Licensing Authority. This license can be obtained through Food Licensing and Registration System (FLRS), which is an online system launched by FSSAI to facilitate FBOs in India to apply for license / registration certificate and help them track their applications during the course of processing.
2. All the FBO Models specified under clause b, c and d above are required to clearly display it on their e-commerce platforms.

1. Any FBO covered under (a) who merely provides listing services to sellers/brand owners, restaurants, vendors, importers or manufacturers of food products may not be required to obtain a license from the authorities, but should ensure that no misleading information, false claims pertaining to the seller, brand owner, vendors, importers or manufacturers, or misleading images of food products are made available or shown on their platform. They shall also clearly specify on their platform that violation of any applicable law shall be the responsibility of the sellers, vendors, importers or manufacturers of the food products. 
2. An E-commerce FBO should ensure that the last mile delivery is undertaken by trained delivery personnel and the safety of food products is not compromised at the time of delivery.
3. Every E-commerce FBO should ensure that the articles of food which are under his/her control at any stage, are in conformity with the requirements specified under the Food Safety and Standards Act, Rules and Regulations.
4. An E-commerce FBO either by himself, or by any person on his behalf shall not manufacture, sell or distribute any article of food which is unsafe, or misbranded or substandard or contains extraneous matter; or for which a license is required. 
5. All E-commerce FBOs are mandated to enter into an agreement with the seller, brand owners, manufacturers asserting that the said sellers, brand owners, manufacturers are compliant with the Act, Rules and Regulations. 
6. The sellers, brand owners, manufacturers who display or offer any ‘pre packed food’ for sale to the customers online, should display a clear and legible picture of such pre packed food and shall also display the batch number, lot number, best before, expiry date and MRP for viewing by the customers.  
7. Any food article delivered to consumer by e-commerce FBO should have a shelf life of 30 percent or 45 days before expiry at the time of delivery to the consumer. In case of caters or restaurant receiving orders through electronic media only fresh food item should be delivered to the consumer.
8. The sellers, brand owners, manufacturers dealing in fresh produce have to provide an indicative image of the produce to the e-commerce FBOs for displaying the same on their platform for viewing by the customers.  
9. The sellers, brand owners, manufacturers on the e-commerce platform shall be required to display their License/Registration obtained under the FSS Act and Regulations. 

1. FBO shall provide mandatory food information (according to the FSS Act) to the customer before the purchase is concluded and without charging any additional costs. Mandatory food information includes_________________.
2. All the FBOS i.e. sellers, brand owners, vendors, importers, manufacturers, restaurants, hotels etc. shall comply with the basic hygiene and sanitary practices provided in the Food Safety and Standards Regulations.  
3. E-commerce FBO shall put in place a proper Consumer Complaint redressal mechanism to promptly address complaints received from consumers.  
4. If any of the consumer complaints are concerning the product efficacy, quality or any other such issues, the same have to be immediately notified by ecommerce FBO to the sellers brand owners / importers / manufacturing company concerned for an expeditious resolution of such a complaint. 
5. Every sellers, brand owners, vendors, importers or manufacturers as the case may be is liable and bound to take action on the complaint raised by the consumer. 
6. The ecommerce FBO will cooperate with the consumers to enable the satisfactory resolution of the complaint by sharing with him all relevant information including seller / brand owner / manufacturer details.
7. Consumer complaints shall be redressed within the time limit specified by the ministry of consumer affairs. 
8. The ecommerce FBO/entities shall immediately delist any food products listed on their platform, which are not in compliance with the FSS Act or Rules or Regulations made thereunder.