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Duties and Responsibilities of Food Business Entities: Product Withdrawal, from the Market

30 Dec 2024

Law on Food Safety

The term food“ is regulated by the Law on Food Safety (“the Law”) and refers to any substance or product, whether processed, partially processed, or unprocessed, intended for human consumption or reasonably expected to be used for human consumption.

Furthermore, in a broader sense, the term "food" also includes beverages (including drinking water), chewing gum, and any substance intentionally added to food during its preparation

 

How is the procedure for food withdrawal regulated?

In accordance with the Law, the procedure for food withdrawal from the market is initiated if a food business entity, when the food is no longer under its direct controlreasonably suspects or determines that a breach of the stipulated food safety conditions has occurred at any stage of production, processing, or trade.

If the above legal conditions are met, the entity is obligated to immediately initiate the procedure for withdrawal the food from the market and notify the relevant ministry responsible for health matters.

Additionally, such an obligation exists if the entity reasonably suspects or determines that the food it has placed on the market may be harmful to human health, and must also take measures to proactively prevent any risk to the consumer.

A similar, but slightly broader obligation is stipulated by the Law on General Product Safety, whereby a producer or distributor, based on available information and their professional knowledge and experienceis required to promptly notify the competent authority if they know or should know that the product they have placed on the market is hazardous.

In this regard, the notification shall particularly include:

  • information enabling the identification of the product, or the product batch;
  • detailed description of the risks posed by the product;
  • all available information necessary for the traceability of the product;
  • a description of the measures and actions taken to eliminate the risks;

Additionally, if the food has reached the consumer, the food business entity is required to inform the consumers efficiently and accurately about the reason for the food withdrawal, and if necessaryrequest the return of the food already delivered to the consumer, if other measures cannot achieve an adequate level of health protection.

On the other hand, the Law on General Product Safety stipulates that the competent authority uses a rapid information exchange system, particularly when ordering a measure for the withdrawal or recall of a product that presents a serious risk.

It should be noted that the Law on General Product Safety distinguishes between the withdrawal and recall of products, depending on whether the product has already been delivered or made available to consumers and other users, requiring its return (recall), or preventing further distribution, exposure, or offering of a hazardous product already on the market (withdrawal).

Given that, in real world circumstances, a food business entity is, in most cases, unable to be certain whether the food has reached the consumer, informing the consumers is a very common practice. This is primarily carried out through various means of communication (newspapers, television, social media), as well as through announcements by the Ministry of Agriculture, Forestry, and Water Management, and also via platforms such as the Rapid Alert System for Food and Feed (RASFF), managed by the Veterinary Directorate, or the Rapid Information Exchange System.

 

What are the penalties for failure to adhere to the prescribed procedures?

If the entity fails to take appropriate measures for product withdrawal, or does not initiate the withdrawal procedure and inform consumers despite the conditions being met, a monetary fine is prescribed ranging from 150,000 to 1,000,000 dinars for a legal entity, and from 50,000 to 400,000 dinars for an entrepreneur.

Furthermore, if during the inspection process, the competent inspector determines that the entity has not ensured that food and animal feed meet the conditions prescribed by this law and other relevant regulations at all stages of production and tradeor fails to prove compliance with those conditions, a procedure for an economic offense will be initiated. The imposed monetary fine in such cases ranges from 300,000 to 3,000,000 dinars for a legal entity.

In addition to the monetary fine, a protective measure may be imposed on the legal entity, such as a prohibition on performing a specific activity, or a protective measure prohibiting the responsible person from performing certain duties for a period ranging from six months to seven years.

 

Conclusion

In practice, when initiating a product withdrawal procedure, it is essential to ensure an efficient response (notifying the competent authorities and the public; labeling and removing unsafe food) and clear communication (e.g., specifying the exact product batch number). Throughout the procedure, constant and transparent communication with interested consumers is necessary.

The problem in practice may arise from a lack of infrastructure for withdrawals, as small and medium-sized producers may not have effective mechanisms for quickly withdrawing products from the market and later retrieving them from consumers. 

It is recommended that the entity conducts internal proactive control to ensure compliance with the conditions prescribed by law and other regulations, in order to avoid financial losses that may arise from the product withdrawal procedure, as well as to prevent potential sanctions related to product safety.

One of the key motivations for initiating a product withdrawal procedure is concern for public health

Since economic entities generally view the issue from a financial perspective, there is always a risk that financial interests may outweigh moral responsibility.

However, another very important motivation for business entities is maintaining their reputation, which often leads them to react quickly and initiate a product withdrawal procedure in order to preserve consumer trust in the quality of their products.

 

Minja Mucić

Junior Associate

minja.mucic@prlegal.rslegal@prlegal.rs;