Want to open a food related Business? Here are the licences you need!
Author : MyLegalWork Staff
We Indians love our food. We also love feeding it to others. “Athithi Devo Bhava Mr. Guest. Please stuff thy face with this food” can be heard in every Indian home.
It goes to show why our food industry is one of the largest in the world. In the Indian food market, 32% share can be accorded to the food processing industry. That is quite a significant amount. There is a flipside to this too though. This very food can easily be the cause of multiple illnesses, especially processed and packaged food. Hence, it is extremely important that the quality of food be monitored obsessively.
Food processing and packaging units need to comply with licence requirements and safety standards compiled by the Food Safety and Standards Authority of India (FSSAI). FSSAI is the central regulator in India, making guidelines on food and everything related to food.
One thing that a food entrepreneur needs to understand is that food is an integral part of our daily life. Whenever the establishment makes ‘cost-saving cuts’ and compromises its 'safety procedure', it is the consumer who is put at risk.
Food establishments need licences based on the market in which they are functioning. For example, restaurant licences will be different from the licences needed in a food packaging establishment. Under the Food Safety and Standards (Licensing and Registration of Food Business) Regulations, 2011, all food business operators need to be registered and licensed as per law. Therefore, unless you have a valid licence, you cannot start your food business.
The food business also needs to comply with the labeling and safety, health and sanitary requirements under the Food Safety and Standards (Packaging and Labelling) Regulations, 2011. These requirements are different for each establishment. So a milk produce establishment like Amul will have different requirements than a food oil corporation.
Since the FSSAI is a central authority, all food businesses need to comply with it. Check the eligibility of your business for a central licence under FSSA here. Each state may have its own laws which you will be required to comply with as well.
Keep in mind that each food business must have other licences as well. These other licences are conditional in their eligibility. So your food business may not require a liquor licence if you are going to sell packaged rice. Some of the other approvals and licences that a food business may be required to obtain from various authorities under different laws are given below:
- Health licences from the local municipal corporation;
- Trade licences from the local municipal corporation;
- Environmental clearance, if required;
- No-objection Certificate (NOC) for fire prevention and safety, for example: for restaurants;
- Registration under the police act of the respective city/state;
- Verification certificate under the Standards of Weights and Measures Act, 1976;
- Registration under the Shops and Establishments Act of the respective state,
- Eating House licence;
- Liquor licence;
- Registration under the Employees' Provident Funds and Miscellaneous Provisions Act, 1952 if it is engaging more than 20 employees;
- Registration under the Central Excise Act, 1944 for goods specified in Third Schedule of the Central Excise Act, 1944;
- Other statutory and regulatory compliances, for example: registrations under Income Tax Act, 1861, Customs Act, 1962, Sales tax, Service tax and other labour laws.
It is comparatively difficult in India to start your own business as compared to the other countries. This is because of the sheer amount of compliances that one has to follow before, during and after the inception of the legal structure of the business. Add to this, the food aspect. Now you have a plethora of rules, regulations and compliances. What is important is to keep the law in mind while starting your business and being aware of the law every step of the way. If you have the support of requisite knowledge or a lawyer, then you will never unknowingly flout any rule.
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