The Codex Alimentarius Commission, the top global decision-making body for food standards, issued the decision at its ongoing annual meeting in Geneva.
"Arsenic is an environmental contaminant. It occurs naturally and is taken up by plants from the water and soil when they're growing, in particular rice," said World Health Organization food safety coordinator Angelika Tritscher.
The commission set a maximum of 0.2 milligrammes of arsenic per kilo of polished race, the product that is traded and consumed.
Arsenic occurs in the Earth's crust. Some of the heaviest concentrations are in Asia, where rice is a mainstay.
A key problem is paddy fields irrigated with water pumped from shallow wells containing arsenic-rich sediments.
Heavy rice consumption has been found to compound the impact of arsenic in drinking water.
"Since rice is a very important stable food for many countries and many regions of the world, a significant part of the global population is affected," Tritscher said.
Parts of Cambodia, China, India and Vietnam have also been affected.
Long-term exposure can cause cancer and skin lesions, Tritscher said. It is also linked to heart disease, diabetes and damage to the nervous system and brain.
Arsenic rarely grabs headlines in the same way as other food crises.
"It's not like you have an immediate, acute effect like you have with a salmonella outbreak," said Tritscher.
The 186-nation Codex commission is run by the WHO and fellow UN agency the Food and Agriculture Organization (FAO). Its standards must be set down into national laws to take effect.
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