Local Food Market Is Discriminated
14 July, 2011
Local Food Market Is Discriminated

Penalties on food entrepreneurs are activated only at the Georgian enterprises, which export product to the EU market. Georgian experts view it as discrimination of local consumers as the state has responsibilities for protecting local market first of all. 

Penalty rates on food processing industry in Georgia are already defined and active as of July 6, 2011. According to the changes, if producing food without registration the enterprises are punished by GEL 300. Moreover, violation of veterinary law on animal quarantine

and veterinary-sanitary norms as well as on prevention measures and liquidation of animals put out by the National Service of Food Safety, Veterinary and Plant Protection (NSFSVP) [of agriculture ministry] subdues to penalty of GEL 1500.

The regulation differentiates two kinds of violations: the critical and non-critical quality standards violations. The critical violation means diversion from standards that makes product risky to health. The non-critical violation includes diversion from technical norms mainly that does not affect the quality of the product ultimately.

Accordingly, GEL 400 is imposed on non-critical violation. The repeated violation envisages GEL 1200 fine.

Critical violation is punished by GEL 1000 and the food processing is halted till the defect is retrieved. If an entrepreneur either refuses partnership with the NSFSVP official or hampers the authorized inspector to implement obligatory procedures GEL 400 will be imposed on such infringements.

However not all food processing industry faces penalties at the moment. Fines are active only for the EU export oriented enterprises. The remainder part of food processing industry focused on local market and any other export market are exempted from penalties till January of 2012.  The governmental sticks to a liberal standpoint that the underdeveloped business sector of Georgia cannot afford adoption of all due food safety standards required by the EU as preconditions to start negotiations on the Deep and Comprehensive Free Trade Agreement (DCFTA) and bigger part of them may go bankrupt if all penalties and regulations enter into effect immediately.

To enable business to outlay  extra investments in quality certificates and reequip enterprises Georgian government announced this year as preferential that means the regulatory body will restrict itself only by recommendations and warning rather than by pressing on shutting down business that lags behind standards.

Shalva Melkadze, Consumer Rights Protection Program Coordinator with the Century 21, finds this kind of preferential period discriminating. Melkadze assures that the EU requirements never mean to focus only on the EU export oriented enterprises that already comply with all standards in fact as  far as otherwise they just cannot penetrate the EU market. It is local market and other export that needs protection.

The point is that the key paragraphs on foods safety including penalties and standards were halted starting 2005 under similar excuse [that business may face bankruptcy] till 2010 however the issue was delayed again for several times till 2012. And the number of food poisoning cases doubled and even tripled compared to 2004 [it stood at approximately 400 per year in 2004 while the figure reached almost 2-3 thousand in 2009-2010].

“It’s good that penalty rates are outlined and put into effect but they must be active to all enterprises without exception,” Melkadze told Georgian Journal. “The law clearly stipulates that the state is responsible for regulation of internal market and what does it come out if we regulate the external market? Imposing penalties only on the EU-export oriented enterprises who already observe due standards is urging a willing horse.”

On the other hand Melkadze finds discriminating that export going to other countries is not equaled with the EU and is as unprotected as Georgian local market.

“Food safety regulation must cover all markets equally; none of consumers should be discriminated. If an enterprises cannot observe due standards let it go bankrupt why do we care for a business that produces risky product?” he said. “If government really cares for business it should create proper lab system in Georgia that now lags behind EU standards and no business can get certificate for the EU market through local lab except wine lab. The state should create a market demand for lab to enable them to develop and be equal to the EU counterparts. And the sooner the penalty system is put into effect the better.”

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