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AgVetLink Issue 64, October 2007, Special Issue on Regulatory Reform

Amendment to ACVM Act

At the time of writing, the Amendment

to the ACVM Act is 'in the queue' for its third and final reading in Parliament. It is expected to be passed during October. While most of the Act will not be amended, there will be some fundamental changes, including the following.

New public health risk area

The risk areas that are relevant to the Act will be expanded to include public health so that risks associated with the use of agricultural compounds that are not already addressed under the HSNO Act can be adequately managed through the ACVM Act.

Proper authorisation

The amended Act will reinforce the requirement for proper authorisation. The fundamental requirements of the Act are:

• no person within New Zealand may sell or use any agricultural compound unless it is registered or exempt from registration

• no person may manufacture in New Zealand any agricultural compound unless it is either registered, exempt from registration, or manufactured for export only

• no person may import any agricultural compound into New Zealand unless it is registered, exempt from registration, or only to be exported, with or without further processing.

Relationship with other legislation

The ACVM Act will still act as a bridge by which regulatory outcomes set under other legislation are given effect at a trade name product level. This relationship with other legislation is clearly expressed in the amended Act.

Direction to regulators

The amended Act will also reinforce the direction to regulators to ensure that regulatory obligations are clear, readily available and efficient in the greater regulatory environment. Regulators must ensure that statutory obligations are imposed either directly under the powers of the Act (ie conditions on registrations) or prescribed in Regulations (ie conditions on prescribed exemptions from registration or minimum requirements on systems and governing people's behaviour).

Exemption mechanisms

The amended Act will provide two new mechanisms to exempt agricultural compounds from registration. The first involves listing substances of negligible regulatory interest as generally recognised as safe (GRAS) so that these substances may be used as agricultural compounds (or in agricultural compounds) without attracting superfluous regulatory assessment costs.

The second mechanism involves 'approval in special circumstances' with conditions and as for substances that are not amenable to registration or prescribed exemption from registration, ie when a substance/product needs to be used for animal welfare, biosecurity or research purposes. This mechanism would be used only if the restrictive conditions that would be imposed could eliminate significant risks.

Operating plans

The amended Act will remove the provision for approved codes of practice that for the most part had no statutory implications and, consequently, did not need official approval. (Parties can set their own codes of practice to codify common best practice.)

However, the approval of codes of practice will be replaced with an approval for 'operating plans'. This approval will be used in circumstances where parties must comply with the plan. Failure to do so would result in:

• suspension or loss of a product authorisation or

• loss of recognition of a person/entity to carry out an activity, and/ or

• (possibly) prosecution.

Power to recognise persons

The original ACVM Act focused exclusively on the authorisation of products, only implying that activities of people could be regulated in the context of product authorisations. However, some activities were generic rather than product specific, making it difficult to link the activity with particular product authorisations. In addition, the regulatory action was likely to have more effect on the registrants of products than on the persons whose actions may have been causing risks.

The amended Act will clarify this situation, providing a power to recognise persons to carry out specified functions for the purposes of the Act. This power will create a robust statutory foundation for activities such as:

• manufacturing veterinary medicines in line with international standards

• authorising the use of restricted products (as currently happens with veterinary medicines that may be sold or used only under a veterinary prescription or authorisation)

• selling/supplying restricted products.

Power to impose conditions

The power to impose conditions on registration will be expanded to ensure that the behaviour of people carrying out activities related to the importation, manufacture, sale or use of the product can be regulated as well as the product itself. It will also make it clear that transport and storage of products are pertinent activities to the extent that they pose risks relevant to the ACVM Act. This will enable conditions to be made without interfering with regulatory control imposed by ERMA NZ and the Labour Department in regard to the hazardous characteristics of the products being transported or stored.

Power to make Regulations

The Regulation making power will be expanded to provide the basis for setting minimum requirements for activities associated with agricultural compounds but not strictly tied to individual product authorisations.

It is anticipated that Regulations will be made to set minimum requirements for manufacturing, advertising and promotion, and the use of substances that are not offered for sale as agricultural compounds but are used for an agricultural compound purpose.

The minimum requirements governing these practices are currently set out in ACVM standards but, after consultation, revised requirements will be transferred into Regulations.

Power to issue notices

NZFSA will have a new power to issue notices that will provide regulated parties with more detail about how to comply with the minimum requirements prescribed in the new Regulations. The advice that is currently in ACVM standards may be transferred into notices if regulated parties advise that such a move would be of benefit.

Suspension of registration and product recall

The amended Act will provide the statutory basis for suspending a product registration in the event of serious non-compliance with the conditions of registration or prescribed minimum requirements. This may be used in conjunction with prohibition notices to ensure products with suspended registrations are not offered for sale until the non-compliance is rectified to NZFSA’s satisfaction. The new product recall power may also be used to remove product from the marketplace if distributed non-compliant product poses immediate risks.

Certificates of compliance

While the ACVM Act governs the importation, manufacture, sale and use of agricultural compounds in New Zealand, the amended Act will provide a power to issue official certificates of compliance that may be needed to facilitate international trade. However, NZFSA’s policy is that it will not certify anything that it cannot verify. Therefore, certificates of compliance will be issued only on request from parties who have participated in compliance programmes that would verify the matters being certified.

Cost recovery

The amended Act will clarify the area of cost recovery, setting the principles that must be followed, requirements for consultation with affected parties, that changes to any fees or charges should be set prior to the commencement of a financial (unless there is specific agreement with industry otherwise), detailing the acceptable mechanism that can be used, and requiring that fees or charges must be reviewed every three years if not reviewed earlier.

No specific consumer protection

The Act will not be amended to provide a specific consumer protection aspect (to prevent people from wasting their money on ineffective products). However, biosecurity events, public health initiatives and sustainable use policies prompted a review of what is considered when authorising products. This made it clear that efficacy and plant safety, which were at first considered irrelevant to the ACVM Act, are now a necessary part of an assessment to ensure that inefficacious and harmful products do not jeopardise public health or biosecurity outcomes and fit within the expectation of sustainable use.

All in all, the amended Act is considered more robust, transparent and flexible. It will be a much more useful tool to ensure that agricultural compounds can and will be used safely and appropriately in New Zealand.