Osheen Sharma , Guneet Mayall
October 27, 2023
Indian legislation recently witnessed a momentous event when the Jan Vishwas (Amendment of Provisions) Act, 2023, (hereinafter referred to as the “Act”) was passed by the Indian Parliament in August 2023.
The government with the means of the Act, intended to achieve overall confidence amongst the masses towards living and doing business in India. The Act aims to encourage trust-based governance by way of decriminalizing and rationalizing the penalties through the amendment of 183 provisions across 42 laws, which includes the Drugs and Cosmetics Act, of 1940, the Food Safety and Standards Act, of 2006, and the Pharmacy Act, of 1948.
In this write-up, we intend to throw light on the amendments introduced by the Act specifically with respect to laws governing, the food, cosmetics, and pharmaceutical industry. It is an established fact that the food, cosmetics, and pharmaceutical industries, affect each and every Indian citizen given their incessant demand for subsistence which keeps rising with the rise in population making these industries lucrative for businesspeople and investors alike.
The Food Safety and Standards Act, 2006 (“FSSA”) in India holds great significance amongst food industry participants and potential foreign investors. It was formulated with the aim to ensure the safety and quality of food products, and consumer interests, and to help grow the Indian food industry. By way of this enactment, the Indian government has not only safeguarded public health, but it has also, catalyzed the expansion of the food industry by way of establishing uniform regulations, harmonizing with international standards, and streamlining processes. Thereby, provisions and operation of the FSSA coupled with factors such as the Indian food industry's diversity, offers rewarding opportunities for investment, innovation, and sustainable business ventures.
Notably, under the Act, Section 59, 61, and 63 of the FSSA has been altered to rationalize the penal provisions as per the prevalent global industry standards while keeping in mind the present requirement of the industry and rising inflation, as discussed in detail herein.
As per the amendment, the maximum term of imprisonment has now been relaxed to three (3) months, whereas the fine has been now increased to INR 3,00,000 (Indian National Rupees three lakh).
Whereas post amendment such person is now made to be penalized in a manner where they shall only be liable to a maximum penalty of INR 10,00,000 (Indian National Rupees ten lakh).
The pharmaceutical and cosmetics industry in India is majorly governed by the Drugs and Cosmetics Act, of 1940 (“DCA”) which regulates the manufacturing, sale, and distribution of drugs and cosmetics in India. This legislation aims to guard public health by ensuring that the safety, quality, and efficacy of pharmaceutical products is maintained through regulations and penalty. It is pertinent to note that India is a country that is hailed as the "pharmacy of the world" due to its pharmaceutical manufacturing capabilities, therefore, legislation such as DCA becomes germane to regulate and support business and investors within the sector. This sector not only attracts global investors but also acts as a major contributor to the nation’s economy, making it an attractive destination for both domestic and foreign investments.
Further, given the recent market trends, changing consumer preferences, and a growing awareness of personal grooming, the cosmetic sector now offers even greater opportunities for businesses and investors alike.
Keeping the aforementioned in mind the Act has introduced a few amendments to Section 29, Section 30 (2), and Section 32B (1) of DCA, with the aim to relax penalties for attracting investors and keeping in mind the rise in inflation, to streamline provisions as per prevalent industry standards, while upholding the basic standards of consumer safety, as elaborated below.
As elaborated in part II hereinabove, it is given to understand how important the Indian pharmaceutical industry is on the global platform as well as with respect to India’s economy. The Act intends to make the Pharmacy Act's provisions reformed enough to uphold stringent quality control measures along with justifying the regulatory framework as an essential measure for ensuring the industry's growth, sustainability, and global competitiveness, making it a fundamental factor for businesses and investors seeking opportunities in India.
As the only constant is change, hence, keeping in mind the global evolution and revolution in the pharma, cosmetics, and food industries, it becomes essential that legal frameworks also should adapt to address emerging challenges. The amended provisions, and inclusions in relation to food, drug, and pharmacy laws, will play a pivotal role in increased accountability, and streamlined regulatory processes, resulting in better public health outcomes and increased consumer protection.
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