Report of Market Access Ombudsman Council (May 13, 1994)

1-(3) Simplifying Inspection Procedures for Dairy Products and Accepting Foreign Inspection Data

1. Complainant: Australian Embassy

2. Ministry concerned: Ministry of Agriculture, Forestry and Fisheries, Ministry of Health and Welfare

3. Complaint:

Dairy products (butter, skimmed milk powder, condensed milk, etc.) designated in the Law concerning the Stabilization of Livestock Prices (Livestock Price Stability Law) and the Law concerning Temporary Measures on Deficiency Payment for Manufacturing Milk Producers (Deficiency Payment Law), are subject to buying and selling by the Livestock Industry Promotion Corporation (LIPC), and their ingredient specifications are set out in the two above laws.

Therefore, when LIPC imports designated dairy products, it entrusts the Japan Dairy Technical Association (JDTA) with inspections of the products based on the JDTA's "Inspection Method for Designated Dairy Products" (the inspection items set out in ordinances related to the Livestock Price Stability Law and to the Food Sanitation Law).

In general, when food products are imported, the Food Sanitation Law requires that the importer give an import notice to quarantine station. But in the case of dairy product imports, the products shall meet the specification standards set out in the "Ordinance Concerning Ingredient Specifications for Milk and Dairy Products" (ordinance of the Ministry of Health and Welfare).

In Australia, on the other hand, under the Export Control Act of 1982, dairy products are inspected before export by specified inspection facilities (inspection facilities certified by the National Australian Testing Association (NATA)) from the viewpoint of public health, and only products whose inspection results have been certified by the Australian Quarantine and Inspection Service (AQIS) may be exported.

Accordingly, the complainant believes that there is no need to repeat inspection in Japan and that inspection procedures should be simplified as follows and foreign inspection data accepted.

(1) Butter and skimmed milk powder imported from Australia can be assured to meet ingredients and specifications of the Livestock Price Stability Law before export by AQIS and the Australian Dairy Corporation, and therefore inspection data certified by AQIS should be accepted without conducting a repeat inspection.

(2) Testing facilities certified by AQIS and NATA have the capability of testing and certifying to the requirements of the countries to which products are being exported. Agreements to use Australian data have already been concluded with the governments of the United States, the U.K., New Zealand and Hong Kong. However, the inspection required by the JDTA has the following problems: dairy products imported into Japan are generally inspected according to the criteria set out in the "Grading Method for Foods, Beverages and Fats" (Notification 1074 of the Ministry of Agriculture, Forestry and Fisheries), but since the inspection items required by the JDTA's "Testing Procedures for Designated Dairy Products" include specified items related to the Food Sanitation Law in addition, criteria for specified item are stricter than those of the MAFF's notification.

(3) If products are eligible under the Registered Exporting Country Plant System which the Ministry of Health and Welfare is intending to introduce, they would be excepted from inspection under the Food Sanitation Law when imported, and since products manufactured in Australian dairy product manufacturing plants meet the standards demanded by the MHW, participation in the system by Australian dairy product manufacturing plants should be allowed.

When doing so, the sanitary conditions in individual Australian dairy products manufacturing plants are already registered with AQIS under the Export Control Act, and the Japanese and the Australian governments should sign an agreement permitting registration on the basis of information provided by AQIS.

(4) Regarding certification that dairy products contain no additives or preservations when imported, importers are sometimes requested to produce a certificate issued by the exporting country's government, but this requirement should be eliminated since products have already been inspected in Australia in public inspection facilities.

4. Results of deliberation:

(1) Regarding acceptance of foreign data concerning item of import inspections of designated dairy products required under the Food Sanitation Law, the LIPC should put it into practice such data immediately, under the implementation of the Pre-certification System for Imported Foods, etc. (registered exporting country plant system).

Regarding inspections carried out by the JDTA under the Price Stability Law and the Deficiency Payment Law, the complainant states that Australia has the capability of conducting inspections according to the requirement by the importing countries, and that inspection data from inspection facilities certified by NATA are actually being accepted by countries much further away than Japan (U.K., etc.). For this reason, considering that it is basically desirable to accept foreign inspection data, the LIPC should verify the above assertion made by the complainant and exchange views, in order to reach a conclusion soon concerning the possibility of using foreign data for the inspection items carried out by the JDTA.

(2) Since the complainant has pointed out that the current inspection criteria and methods used by the JDTA are unclear, the LIPC should prepare a guidebook or take other necessary measures, and if it decides to accept foreign inspection data, should explain clearly the inspection criteria and methods to the complainant.

(3) Receiving applications for registration of dairy product manufacturing factories through the Australian government, the MHW should immediately examine whether the factory(s) in question meets the necessary sanitation requirements for foods, and should register foods meeting these requirements.

In verifying the sanitation requirements, the MHW should consider using the AQIS registration data in light of the fact that the factories are already registered with AQIS in Australia.

(4) Regarding import notifications for imported dairy products, it was ascertained during the examination process that importers are not required to attach a certificate from the exporting country's government stating that the products do not contain additives or preservatives to the import notification form.

Government decision (June 24, 1994)

1-(4) Promoting acceptance of foreign inspection data concerning the import of designated dairy products

(1) Regarding import inspection of designated dairy products, which the Japan Dairy Technical Association (JDTA) is entrusted by the Livestock Industry Promotion Corporation (LIPC) to make based on the Food Sanitation Law, foreign inspection data will be accepted under the Pre-certification System for Imported Food, etc.

(2) Regarding the possibility of accepting foreign inspection data which correspond to the data inspected by the JDTA under the Livestock Price Stability Law and the Deficiency Payment Law, conclusion will be reached at early stage by exchanging views with the complainant as soon as possible.

(3) Regarding the JDTA's inspection criteria and methods, a detailed English guidebook will be prepared by the end of July 1994 to facilitate understanding by foreign businesses.

Follow-up (June 5, 1995)

1-(3) Simplifying Inspection Procedures for Dairy Products and Accepting Foreign Inspection Data

(1) The Pre-certification System for Imported Foods was introduced in March 1994. Information regarding the system was disseminated in February 1995 at the APEC Sub-Committee on Standards and Conformance meeting and at the workshop on import procedures for foods sponsored by the FAO held in Canberra and efforts were made to promote the use of this system. If written applications are received from exporting country governments, inspections will be carried out promptly, and if Japanese sanitary standards are met, the factories and foods in question will be registered and import inspection waived.
Accordingly, dairy products imported under this system will no longer require the current food sanitation inspections conducted by the JDTA.

(2) Discussions were held with Australian officials in Tokyo in July 1994 and with officials of Australian Dairy Corporation in Australia in February 1995. The Japanese ministries concerned explained that inspection items concerning solubility and other quality factors based on the Price Stability Law and the Deficiency Payment Law were not necessary from the viewpoint of customs clearance but were based on requests from users and were meaningful indices of checking deterioration of quality due to accidents during transport. It was agreed to continue discussions on commercial transactions in the future.

(3) An English guidebook describing the detail of current inspection criteria and methods used by JDTA was prepared, and this was distributed and explained to the Australian authorities in July 1994.

(4) See (1)

In addition, the use of AQIS data when registration is carried out will be studied when applications from Australia are studied.