Red Ginseng, Vitamins, and Other Health Functional Foods Will Also Be Tradable with 'Carrot Transactions'

Regulatory Adjudication Division Recommends MFDS Allow Peer-to-Peer Resale

In the future, the resale of health functional foods such as red ginseng and vitamins between individuals will be permitted.

The Government Regulatory Scrutiny Committee announced on the 16th that it has recommended the Ministry of Food and Drug Safety to allow small-scale resale of health functional foods between individuals.

The domestic market size for health functional foods, including red ginseng, vitamins, and probiotics, reached approximately 6.2 trillion KRW as of last year.

Although individual purchases account for a large portion, current health functional food regulations require business registration for selling health functional foods, thus prohibiting all resale between individuals without business registration.

With the recent increase in peer-to-peer transactions through online platforms, there have been many criticisms that such regulations restrict consumer choice and cause inconvenience to the public.

Considering Supreme Court precedents, the Regulatory Scrutiny Committee judged that prohibiting small-scale resale by individuals, not large-scale transactions by businesses, based on current related regulations is an unclear shadow regulation without a clear legal basis.

It also pointed out that treating unregistered peer-to-peer resale as a serious offense punishable by up to five years imprisonment or a fine of up to 50 million KRW could infringe on citizens' rights.

Since most health functional foods can be stored and distributed at room temperature and have longer shelf lives compared to general foods, and with online sales accounting for 68%, the Regulatory Scrutiny Committee judged that safety risks are unlikely to be significant.

Major countries overseas, including the United States, the European Union (EU), and Japan, all allow peer-to-peer resale.

The Regulatory Scrutiny Committee recommended that the Ministry of Food and Drug Safety prepare a reasonable alternative to permit small-scale peer-to-peer resale of health functional foods within the first quarter of this year, ensuring food safety and distribution order.

The Committee evaluated that this improvement recommendation could enhance public convenience while maintaining the overall distribution order of the health functional food market.