Struggling to make ends meet during the coronavirus pandemic, many people have turned to their home kitchens to sell home-cooked food online. Imagine the shock when tax officials knock on their doors.
This is what happened to a family which sold fresh orange juice from their home kitchen recently. The incident made headlines and sent a shiver down the spines of people in the home-based food businesses across the country.
For they, too, have lost their income from a variety of state lockdown measures to contain the coronavirus. They, too, have been using their home kitchens to sell home-cooked foods, desserts, and beverages online. The last thing they want is to go to jail or pay exorbitant fines for breaking the law.
Business bankruptcy and downsizing during the protracted pandemic and repeated city lockdowns have plunged millions into joblessness. With the closure of food shops and the ban on in-person dining, many have tried to survive the economic crunch by selling home-cooked food online. High demand and low investment costs have led to a proliferation of home-based food businesses and delivery services.
In the orange juice vendor’s case, the excise tax officials made an order online and then arrested the vendor at their house before imposing a huge fine.
Deception aside, do the tax officials have the law on their side? The answer is not clearcut. Without legal clarity, home-based food entrepreneurs are fearful of similar arrests and future business difficulties. The legal ambiguity also invites corruption.
Are online home-based food businesses illegal in Thailand? Under the 1992 Public Health Act, restaurant owners must have permits or certificates of notification to operate their businesses. Food shops and restaurants must also meet official hygiene and sanitation standards. If they do not meet food safety requirements, they face a jail term of between three to six months and a fine of between 10,000-30,000 baht depending on the type and size of their business.
Restaurants with permits and food safety standards can operate online food businesses legally for they are only switching from on-site services to delivering food to customers.
However, there are still no clear-cut laws to regulate online home-based food businesses. The 1992 Public Health Act divides food shops and restaurants into two categories. The first is food businesses operating in privately owned areas. The second is those selling food in public areas such as street vendors.
Although home-based food businesses are operating on privately owned land, the law does not specifically clarify whether the “food-selling location” includes online food businesses without a conventional shop setup.
Besides, the regulations aim to regulate conventional food shops and restaurants for in-house visits only. They then have rules about the shop setup and restroom requirements, for example.
Two problems arise from this lack of legal clarity. Firstly, health hazard risks for consumers. When online food vendors do not have to adhere to hygiene and sanitation standards, consumers suffer. Secondly, there are corruption opportunities. When the law is unclear, corrupt officials can abuse the law to demand tea money.
We can learn from how other countries manage home-based food businesses. The food safety laws in European Union, the United States, and Japan, for example, cover a wide variety of food businesses which include those outside the conventional restaurant setting. Food trucks, street food vendors, and online food businesses from home kitchens must strictly adhere to food safety regulations which emphasise hygiene and sanitation of food, personnel and facilities.
The food safety law specifies different requirements for different types of food business. They may also vary in different jurisdictions. For example, online retail food facilities in Florida are strictly governed by the Cottage Food Operations. Operators who use home kitchens to sell their food must meet food safety standards and provide food labellings on ingredients, allergy cautions, and production facilities for traceability.
In California, however, the Cottage Food Operations make it mandatory for people who use home kitchens to produce food for sale to obtain permits, apart from adhering to food safety standards. The European Union has the same requirement for home kitchen business operators to register with local authorities.
Here, the Public Health Ministry which oversees food businesses must revise the outdated law to cover online home-based food operators. We have two recommendations.
First, the ministerial regulations on food business facilities should be amended to be open to new forms of food businesses. If the Public Health Ministry rules that homemade food businesses should be governed by food business facility regulations, it must create an online system for home kitchen operators to notify local officials and obtain certificates of notification without difficulty.
Secondly, the public health authorities should design a new set of food safety standards for home-based food businesses for better consumer protection.
The state authorities should consider working with food delivery platforms to make it mandatory for online retail food businesses to meet food safety standards. This requirement will further strengthen consumer confidence in homemade food products.
A clear-cut law for home-based food businesses will protect consumers with safer food products from home kitchens. It will also protect operators from corrupt officials. Subsequently, home-based food businesses will become stronger, welcome more operators, and continue to offer new ways for people to survive the current economic crisis.
By Urairat Jantarasiri, researcher at the Thailand Development Research Institute (TDRI). Policy analyses from TDRI appear in the Bangkok Post on alternate Wednesdays.
First Published: Bangkok Post on August 11, 2021
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