A strategy for international trade

Trade borders

Trading across borders often appears simple. But in reality, even the smallest change in ingredient can result in a disruption of your on-going business. Import and export processes are, in fact, quite complex.

When trading only within the European Union or within a similar free trade zone, changes most of the time do not present problems. Especially within the European Union, you can amend recipes and as long as they are in compliance with the European Legislation, products can be exported to all EU member states. Problems arise at the moment your company wishes to export such products outside the European Union. Your products would probably not be allowed to be imported into the country of destination or even not be exported due to legislation or veterinary certification of the EU or Member State concerned. 

Doing business in China

In case you have a plan to start a new pet food business in China, you will need to verify whether your country is approved for export to China, as the Chinese government only allows import of pet food from certain countries. Next, you need to arrange that your production location is approved by the Chinese government authorities. Only then is it possible to export your products to China, but you will still not be able to market your products there. 

In China, you will need to register each product you are selling. This product registration is per recipe, per production location. So after arranging such a registration, you can finally export your products. Of course you will need to check if the products you are exporting fulfil the requirements of the veterinary certificate, which you need to obtain from the veterinary service in the country of export.

The process of changing a recipe

When changing a recipe, one needs to take the following steps: 

• The country of export’s approval needs to cover the type of pet food you want to export. The approval differs for pet food with or without animal ingredients.
• The production location needs to be approved for the type of animal origin ingredients.
• The new recipe needs a specific product registration; this procedure will take at least six months. In case you use an entirely new ingredient, such as insects, this procedure can take even longer. 
• Discuss with your own government how to fulfil all requirements in the export certificate.

Now, companies can export and market a product. However, a company wishing to change supplier may present a challenge, as the product registration will need to be in its name. There have been many, even leading, companies which had their product registered in their agent’s name. It is important to consider that it is not possible to change importer without the permission of the owner of the registration.

This process may seem extreme, but it simply is reality, not only in parts of Asia. Think about the export of pet food to the USA. It is possible, the importer needs to file a BSE facility checklist to receive an import license. In case a company is going to use a new ingredient in their production location, even when it is not being used for export to the US, you will need to send an adjusted checklist to the US authorities. Not adhering to these rules means that you can potentially be fined and blocked as a supplier.

Changing legislation

Another important factor to consider is the fact that certain ingredients are no longer allowed due to changing legislation. For instance, sodium bisulphite has been banned for use in food for pets and taken off the list of allowed substances under EC Regulation 1831/2003. This means that export of this substance is prohibited, unless you can prove that the destination country allows the forbidden substances of the EU.

What to do? 

Despite the best efforts of pet food associations worldwide, there is still a long way to go. Meanwhile it is important to work closely together as importer and exporter, and more importantly 

with governments and consultants with knowledge of the international trade and especially veterinary export procedures and registration prescriptions. Otherwise, you may at one point receive notification from the authorities that you are no longer allowed to export.