Liuming International China Business Lawyers

Introduction & background

Pets are very popular in China

Domestic pets have become an integral and much loved part of the life of many Chinese. Different types of animals and birds may be kept as pets, but cats and dogs have become extremely popular among city dwellers adding a new dimension to the China pet food trade.

A huge market has grown up to cater to pet owners wanting to look after and pamper their pets and imported pet food is a significant part of it.  Sources of supply have grown rapidly, and range from pet shops and other retail outlets through to E-commerce in all its forms, including cross-border. Overall this market has grown faster than its regulatory regime.

China pet food regulatory system changes – overview

On April 27, 2018 China’s Ministry of Agriculture and Rural Affairs (“Ministry of Agriculture”) issued Announcement 20 which referred to attached regulations. Some specifically directed at cat and dog food. The changes were effective from 1 June, 2018, but with a grace period until August 31, 2019. From September 1, 2019 the new regulations will apply with full force.

China has a complex regulatory system for the import of pet food that involves multiple government departments and levels. In summary:

1. the pet food should be registered at the Ministry of Agriculture;
2. an offshore pet food manufacturer should be registered at the China General Administration of Customs (“China Customs”);
3. a domestic pet food importer should be formally recorded at the local delegate of China Customs; and
4. the pet food should pass the Customs quarantine and inspection, and for pet foods containing animal ingredients or formula pet food, a Permit for Animal and Plant Import is needed.

Announcement 20 also made it clear that:

• existing holders of a valid import registration certificate for their cat and dog food product could continue to export and sell until that certificate expired, but then a new application would have to be made;
• if dog and cat foods were presently being imported without an import registration certificate, an import registration certificate should be applied for and obtained by September 1, 2019; and
• holders of an existing import registration certificate for additive premixes to be directly consumed by a pet cat or dog (not as part of a product manufactured by others) should apply for and obtain a new import registration certificate by September 1, 2019.

Cross-border E-Commerce

Certain E-commerce modes, but not all, are presently excluded from the full scope of the changes in Announcement 20 but labeling and hygiene requirements should be met.

Key issues for the China pet food trade

1. The Methods on the Administration of Pet Feed provide that they only apply to cat and dog food and pet formula feeds and pet additive premixes to be directly consumed by cats and dogs.
2. An offshore manufacturer should obtain the import registration certificate for pet feed for each product before it can be exported to China. It usually takes about 6 months to obtain a certificate for a product.
3. Imported pet feed should comply with the Labeling Rules for Pet Feed. A Chinese language label is essential and should include required information such as place of origin, details of the offshore manufacturer, details of the Chinese importer and its contact information. Expert advice should be obtained about this.
4. Trademark is an important issue arising from this labeling requirement. The Chinese name of the product and the manufacturer is required on the label, but including them there is no protection from trademark infringement. Both should be trademarked in China by the offshore manufacturer, not the importer.
5. Pet feed that contains raw materials or additives prohibited in China cannot be imported. A List of Raw Materials for Animal Feed and a List of Additives for Animal Feed have been adopted and will be updated from time to time.

Protecting label information with trademark

As noted above a Chinese language label is required for imported cat and dog food but use there does not give any real rights or protection.

Every product sold in China becomes known by its Chinese name: not the name in the home country language. If the offshore supplier does not decide on and control the Chinese name it wants to use in China, it will get one anyway, but it will almost certainly be controlled by someone else.

Remember that China has a “first to file” trademark system – the first to register the trademark owns it. If the offshore supplier’s name, or its product name, is registered as a trademark in China by someone else the China business is then effectively owned by someone else.

Note that nothing related to a China trademark is less expensive than registering it!

Take away points

• The present signal from China is clear. The government has tightened its control over the China pet food market, including the manufacture, import and sale of cat and dog food in China. September 1, 2019 is the day of change.
• The new regulations do not affect all cross border transactions immediately but it cannot be assumed that the current limited exemptions will continue indefinitely, or at all. Anybody directly or indirectly engaged in the China pet food market should consider their position carefully and seek advice.
• A prudent supplier into the China pet food market, even if presently participating in the exempt E-commerce business, should take the steps to become fully compliant for all forms of the China pet food business.
• September 1, 2019 is almost upon us. China pet food imports without an import registration certificate (except for the current limited E-commence exception) will very soon be history.