The Safe Food for Canadians Act: What AgriFood and Beverage Businesses Need to Know

February 22, 2019

Written By Julia E. Schatz, Jessica B. Horwitz and Pavan Virdee

The new Safe Food for Canadians Act (SFCA) and the Safe Food for Canadians Regulations (SFCR) came into force on January 15, 2019. These new laws modernize and streamline the food safety regime administered by the Canadian Food Inspection Agency (CFIA), but create new compliance requirements for businesses that import, export or trade food products interprovincially. Some requirements relating to traceability, packaging, labelling and grades also apply to certain types of foods traded within a province.

Food and beverage businesses in Canada must review their existing compliance programs to ensure they comply with the new legal requirements, and businesses whose products were not previously regulated must implement new compliance procedures before the applicable deadlines.

Key Changes

Based on the internationally recognized Hazard Analysis Critical Control Point (HACCP) principles of food safety, the SFCR consolidate 14 sets of previous food regulations to create one set of consistent regulations that apply to all categories of "food" (i.e., any article manufactured, sold or represented for use as food or drink for human beings, chewing gum, and any ingredient that may be mixed with food for any purpose whatever) and any animal or plant, or any of its parts, from which food may be derived. Some of the key changes include:

More Types of Food Are Subject to Regulation

While previous food safety regulations only covered specific categories of food products, the SFCA and SFCR apply to food or drink for human consumption (including ingredients) that is imported, exported or interprovincially traded, and to food animals from which the derived meat products will be exported or interprovincially traded. Animal feed and pet food are not covered.

Licence Requirements

Whether a food business requires a SFCA operating licence depends on its activities. A licence is required for food businesses that:

• import food;
• export certain types of food;
• manufacture, process, treat, preserve, grade, package or label food to be exported or sent across provincial or territorial borders;
• store food to be exported or sent or conveyed from one province or territory to another;
• slaughter food animals from which meat products are derived for export or to be sent across provincial or territorial borders; and
• store and handle a food in its imported condition for inspection by the CFIA.

Most existing food business licences and registrations, including under the Canada Agricultural Products Act, the Meat Inspection Act, and the Fish Inspection Act, will be automatically grandfathered and businesses will only need to apply for a new licence under the SFCA when their old one expires. To be eligible for grandfathering, a licence or registration must contain the following statement: "This certificate is issued in accordance with the [name of the Regulations]. This registration, licence, permit or authorization is also a licence that is issued under the Safe Food for Canadians Act upon its commencement day."

For food products that did not previously need a licence, there are rolling deadlines to obtain a SFCA licence based on the product and the size of the business (with small businesses receiving extended deadlines). The schedule of deadlines by product is available on the CFIA website.

SFCA licences can cover either a single facility or multiple facilities, at the option of the business. Having a single licence may be less administratively burdensome for a business, but it also means that if there is non-compliance at one facility, all covered facilities could be at risk of suspension at the same time if the licence is revoked.

A SFCA licence will cost $250 and is valid for two years. Previous fees that existed to register an establishment have been converted into establishment inspection fees at the same cost, which are payable upon the first inspection in a year. Applications for a Safe Food for Canadians licence can be completed online through My CFIA.

Preventive Controls

The preventive control requirements in the SFCR are designed to prevent food safety hazards and reduce the likelihood of contaminated food entering the Canadian marketplace. Operators and licence holders who import food must adhere to the preventive control requirements. Businesses that engage in certain specific activities are required to prepare, keep, maintain and implement a written "Preventive Control Plan", namely those that:

• hold a licence to manufacture, process, treat, preserve, grade, package or label food for interprovincial trade;
• grow or harvest fresh fruits or vegetables for interprovincial trade; 
• hold a licence to import food;
• hold a licence to store and handle an imported edible meat product for inspection by the CFIA;
• hold a licence to manufacture, process, treat, preserve, grade, package or label meat products or fish for export;
• export food for which they would like to obtain an export certificate or other export permission from the CFIA, such as being on an export eligibility list; or
• hold a licence to slaughter food animals.

For a detailed list of requirements for each type of operator and importer, please visit the CFIA's Preventive Control Plan Interactive Tool.

Preventive Controls must be proportional to the level of risk, and their effectiveness must be evidenced with a validation study. The "validation" concept comes from the HACCP definition, which is the process of obtaining evidence that a control measure or combination of control measures, if properly implemented, is capable of controlling the hazard to a specified outcome. Control measures that were previously validated before the SFCA came into force do not need to be re-validated, but re-validation is required if the control measures change or there are repeated failures or deviations.

Traceability Records

Traceability is the ability to track the movement of a food or food ingredient one step backward and one step forward in the supply chain. The SFCR's traceability requirements ensure that food businesses keep and are able to access timely and precise information in the event that unsafe food needs to be removed from the market. Traceability records must enable the CFIA as part of its enforcement activities to specifically identify the food (using a unique lot number or other identifier), identify the supplier it came from and the date, and identify the customer it was sold to and the date.

Records may be physical or electronic, but in all cases must be easily and quickly accessible from within Canada. Electronic records must be in a format that can be read by or imported into standard commercial office software to ensure the CFIA can view and work with the data if needed, in keeping with the CFIA's food safety investigation and recall mandates under the Canadian Food Inspection Agency Act.

Traceability also requires that the label attached to the food when it is provided to another person include (1) the common name of the product, (2) the name and place of business by or for whom the food was manufactured, prepared, produced, stored, packaged or labelled, and (3) the lot code or unique identifier (note that a UPC or price look-up code is not sufficient as an identifier because it is not unique to a particular production lot).

Again, whether a food business needs to maintain traceability records depends not on the food but on the business' activities. Traceability records must be kept going back two years by businesses that:

• import or export food;
• distribute or send food products across provincial or territorial borders;
• manufacture, process, treat, preserve, grade, store, package or label food, grow and harvest fresh fruits or vegetables or slaughter food animals from which meat products are derived, where the product is exported or sent across provincial or territorial borders;
• store and handle edible meat products in their imported condition for inspection by the CFIA; and
• sell food to consumers at retail, which need to trace one step back but not forward to the consumer.

The "retail" category does not include restaurants, cafeterias or other similar food service businesses, which are not required to keep traceability records unless they trade food across provincial or territorial borders. But businesses such as grocery stores or bakeries that might also serve prepared meals in addition to selling food at retail are still subject to traceability requirements because their principal business is retail operations.

New Import and Export Requirements

All food importers will now require SFCA licences, Preventive Control Plans and Traceability records. Non-resident importers can in some cases qualify for a licence, but only if they are located in a country that the CFIA recognizes as having equivalent food safety standards, and the food to be imported comes from the same country. Otherwise, the Canadian customer or consignee may need to act as the importer of record for Canadian customs purposes. Lists of eligible non-resident importation countries are available on the CFIA website. Border control procedures on the Canada Border Services Agency side have not changed, and the Automated Import Reference System has been updated to the SFCR requirements.

A business that exports food from Canada but does not otherwise process or handle it may not need a licence depending on the type of food (for example, fish and meat still require licences). But in all cases, all applicable Canadian and country of destination food safety standards must be met for the production and handling of the food.

As a separate matter, the country of import may require the exporter to produce a CFIA export compliance certificate, for which an application to CFIA is required. Export certification requires that the exporter have a SFCA licence and a Preventive Control Plan even if the category of food is otherwise exempt from those requirements. It is therefore critical for exporters to be familiar with the import requirements of the destination they are shipping to, so that they can position themselves to meet the necessary requirements on the Canadian side.

Packaging and Labelling

The SFCA and SFCR also contain rules regarding the labelling, packaging, identification and grades of certain categories of products, including meat and food animals, dairy, eggs, processed egg products, fish, honey, maple syrup and fresh fruits and vegetables, combining and updating those previously found in product-specific regulations. Other packaging and labelling rules, such as those found in the Food and Drugs Act, Food and Drugs Regulations and the Consumer Packaging and Labelling Act, also continue to apply. The SFCA applies generally to import, export, and interprovincial trade activities; many of the SFCA's requirements, including licensing (for most categories of food), do not apply for businesses that only distribute food within a single province. However, there may be provincial regulations that apply, and some provinces may require food businesses to obtain a federal licence in any event.

Implementation and Enforcement

The SFCA requirements came into force immediately on January 15, in respect of some of the higher-risk categories of food, such as meat, eggs, fish, fresh fruits and vegetables and dairy. For other categories, such as bakery goods, food additives and prepared foods, the various SFCA requirements will be phased in over 12 to 30 months depending on the requirement, type of activity and size of the business.

The CFIA has indicated that it will be lenient on enforcement of new SFCA requirements for an unspecified initial period with a preference to issue warnings. It will only use "hard" enforcement, such as licence suspensions, if necessary to protect public health, where, for example, the conduct poses serious risk to the public or there is evidence of intentional non-compliance. However, it is not clear how long this informal grace period will last, and food businesses should ensure their compliance with the SFCA as quickly as possible.

The lawyers in the Agribusiness, Food and Beverage and International Trade and Investment groups at Bennett Jones are available to provide your food business with guidance on implementing the new SFCA and SFCR requirements, import and export structuring, and food safety compliance best practices, as well as helping your business to navigate compliance incidents and recalls, and to limit litigation exposure risk.

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