New food safety rules don't dent online catering services

Updated 2018-01-03 09:30:24 Global Times

Industry players said they don't see much immediate change after a new regulation that bans online catering and ordering services without brick-and-mortar restaurants officially took effect on Monday. However, experts warned of a shake-up for platforms offering services provided by individuals cooking in their own kitchens.

Online catering and ordering services should be subject to the same rules as physical restaurants, according to the regulation issued by the China Food and Drug Administration (CFDA) in November 2017.

The new regulation stipulates that only catering businesses with actual restaurants and proper business licenses may offer online catering and ordering services. It also sets hygiene requirements for food delivery staff.

However, business seems to be going on as usual for online-to-offline (O2O) catering services platforms such as Home-Cook, which operates via an app on mobile devices that allows customers to place orders at private home kitchens.

The Global Times placed an order and successfully went to one home kitchen in Beijing to fetch food on Tuesday.

House calls and visits to the kitchen are encouraged by Home-Cook as a way to ensure hygiene levels, along with other measures such as real-name registration, random checks by platform staff, insurance for each meal and word-of-mouth supervision by the public via the app, according to information shown on the app.

The food producer, who didn't wish to be identified, told the Global Times on Tuesday that so far the business was going on as usual. "It is impossible for me to run a brick-and-mortar restaurant, just consider the rents in Beijing!" the person said.

Email inquiries sent to jiashuangkuaizi, the operator of Home-Cook, went unanswered on Tuesday.

Wang Ling, an analyst at Beijing-based consultancy iResearch, said the businesses offered by the likes of Home-Cook are small compared with services offered by companies like ele.me in terms of volume.

"While public supervision is a useful supplement to government supervision, the public has neither the needed authority nor power to impose penalties like government agencies do. All considered, the future of such services is bleak," Wang said.

Brick-and-mortar restaurants make it possible for officials to perform their supervisory roles, but home kitchens don't, Wang said.

"Whether such services need to be shut down can be discussed at a later time, but the platforms may face a business shake-up," Li Junhui, a professor at China University of Political Science and Law, told the Global Times on Tuesday.

A PR employee at Shanghai-based food-ordering platform ele.me told the Global Times on Tuesday that the company had not been caught off guard.

"The regulation that just took effect, and it is in every way within the framework of China's Food Safety Law (2015). The new regulation gives more details of that law, but the company has been aligning its business practices according to the 2015 law for a long time," the person said.

In August 2017, ele.me bought rival waimai.baidu in a takeover deal valued at about 0 million.

Waimai.meituan.com, an O2O food delivery platform owned by China's leading group-purchasing site meituan.com, did not respond to a request for comment on Tuesday. Meituan, ele.me and baidu together hold more than 90 percent of China's food delivery market.

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