11 Requirements for feed hygiene
| (24454)
8554/03
COM(03) 180
| Draft Regulation laying down requirements for feed hygiene
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| Legal base | Articles 37 and 152EC; co-decision; QMV
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| Department | Food Standards Agency
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| Basis of consideration | Second SEM of 11 March 2004
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| Previous Committee Report | HC 63-xxvii (2002-03), para 5 (25 June 2003) and HC 63-xxxvi (2002-03), para 6 (5 November 2003)
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| To be discussed in Council | April or May 2004
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| Committee's assessment | Politically important
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| Committee's decision | Cleared (but see para 11.9 below)
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Background
11.1 The wide range of Community measures dealing with the composition
and marketing of animal feeds[15]
include Council Directive 95/69/EC,[16]
which lays down the arrangements for approving establishments
manufacturing, producing or putting into circulation various such
products. According to the Commission, recent events such as
the BSE crisis suggest that further steps are needed, and it therefore
put forward in April 2003 this proposal to extend the scope of,
and update, the measures currently contained in Directive 95/69/EC.
11.2 The main changes proposed were set out in our
Report of 25 June 2003, and would include the approval and registration
of establishments (extending the need for registration to all
food businesses); making operators of feed businesses responsible
for ensuring feed safety; requiring all feed business operators
(excluding those involved only in primary production) to put in
place and operate an HACCP System;[17]
requiring operators to have financial guarantees to cover the
risks to their businesses; and allowing feed business operators
to import feed and feed products only from third countries which
appear on a list, drawn up in accordance with proposals which
the Commission has put forward for a separate Regulation.[18]
11.3 Whilst the Government had welcomed the proposal,
it had said that the practicality and proportionality of a number
of the provisions needed to be examined, notably the proposed
registration requirements for farms and the introduction of HACCP
requirements. It was also thought unlikely that all feed businesses,
including farms, could fulfil a new requirement to have financial
guarantees in place, particularly as the cost of premiums could
be unsustainable. However, although the Government had provided
an initial Regulatory Impact Assessment, this had indicated that
it was not possible at that stage to assess the financial benefits
of the proposal, and that further information would be sought.
11.4 We subsequently received a supplementary Explanatory
Memorandum of 30 October 2003 from the Parliamentary Under-Secretary
of State for Health (Miss Melanie Johnson), together with an updated
Regulatory Impact Assessment, which she said largely confirmed
the issues identified previously, including the likelihood that
the insurance industry would be unwilling to provide the cover
needed for financial guarantees, and the need therefore to consider
(at least in the short term) some kind of collective pool into
which operators would provide funds for any incidents which might
occur.
11.5 The Assessment also provided discounted costs
and benefits for various options,[19]
and we noted in our Report of 5 November 2003 that the benefits
of the different approaches were similar (ranging from £4.5
million to 6.5 million), and would be broadly comparable to the
costs (of between £9.9 and 11 million), but for the requirement
for financial guarantees. Equally, whichever approach was adopted
on the latter, the costs would rise significantly to at least
£54 million (and, in certain circumstances could be as high
as £83 million). In other words, how the issue of financial
compensation is dealt with had a crucial bearing on the impact
of the proposal. In view of this, we said that we would hold
the document under scrutiny, and we asked the Minister to keep
us informed in good time of any significant developments, particularly
in relation to this point.
Second supplementary Explanatory Memorandum
11.6 We have now received a second supplementary
Explanatory Memorandum of 11 March, in which the Minister says
that the proposal has been discussed in recent Council working
group meetings and by the relevant committee of the European Parliament.
There is now general agreement in the working group that certain
aspects of the proposal should be amended, and the Minister says
that these would address the UK's concerns as follows:
- financial guarantees would
no longer be compulsory, though Member States would be required
to encourage their uptake: at the same time, the Commission would
be required to present a report, within two years of the adoption
of the Regulation, on the feasibility and appropriateness of a
system of financial guarantees for feed businesses;
- although Community guidelines on the application
of HACCP principles would be drawn up, Member States would be
able to draw up national guides as well: it has also been made
clear that the requirement for feed businesses to implement these
principles would not apply to farms which buy-in and mix compound
feedingstuffs with other material;
- it will be made clear that the detailed standards
with which feed businesses would have to comply would apply only
where these are relevant to an individual business's operations;
- it is likely that enforcement authorities would
be able, for the purposes of registration under this Regulation,
to use lists of businesses already registered under food hygiene
rules, and would thus not be faced with the burden of creating
a new register;
- approvals of feed businesses would no longer
have to be renewed on a regular five-yearly basis, but would be
linked to inspections carried out as necessary by enforcement
authorities; and
- instead of the Regulation coming into force one
year after its adoption, its date of application would be linked
to the coming into force of the corresponding measure on food
hygiene (which is expected to be no earlier than 1 January 2006).
However, the Minister has pointed out that, although
discussions have taken place with the European Parliament, these
amendments have yet to be adopted by the Parliament.
11.7 The Minister has also provided a revised Regulatory
Impact Assessment, which takes into account the above changes.
However, the range of costs and benefits would remain essentially
as set out in our Report of 5 November 2003, and would become
significant only if the provision for compulsory guarantee were
to be retained.
Conclusion
11.8 It appears that, if the amendments which
have been agreed within the Council are also adopted by the European
Parliament later this month, the impact of this proposal would
be relatively minor, and we would in that event see no difficulty
in the UK agreeing to it. On the other hand, if the Parliament
were to decide to insist on the retention of a compulsory financial
guarantee, we would want to examine the implications carefully.
11.9 However, it is possible that the measure
will come before the Council for adoption before we have had a
chance to consider it further. Therefore, although we clear the
document, if the Parliament proposes significant changes, particularly
as regards compulsory insurance, and the Council is minded to
accept them, we ask the Government to report back to us and let
us have the opportunity to comment before giving the UK's agreement.
In any event, we ask the Minister to keep us informed of progress.
15 These include such measures as listing authorised
feed additives, and controls on contaminants. Back
16
OJ No. L.332, 30.12.95, p15. Back
17
Hazard Analysis and Critical Control Points. Back
18
(23671) 10987/02; see HC 63-i (2002-03), para 5 (20 November 2002)
and HC 63-xxi (2002-03), para 13 (14 May 2003). Back
19
These include implementation of the proposal as it stands; the
removal of the need for financial guarantees; the introduction
of some kind of pool arrangement in the short term, pending the
development of conventional insurance; and delayed implementation. Back
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