A Japanese government panel announced that it recommends regulating only genetically modified organisms that have had foreign genes permanently introduced into their genomes and not those whose endogenous genes have been edited. The only stipulation is that researchers and businesses will have to register their modifications to plants or animals with the government, with the exception of microbes cultured in contained environments. Reactions to the decision are mixed. While lauding the potential benefits of genome editing, an editorial opposes across-the-board permission. Unforeseen risks in gene editing cannot be ruled out. All genetically modified products must go through the same safety and labeling processes regardless of method.

Let us note down the important points:

The Japanese government recommends regulating GM organisms in which foreign genes are introduced, not those in which the endogenous genes have been edited. The step has drawn mixed reactions since there are some risks involved in gene editing.

Option A shifts the focus on exempting microbes. The central theme of the passage is that endogenous gene editing is not totally risk free. Therefore, we can eliminate option A. 

Option B states that categorizing GM products advances science but defies laws. No such comparison has been made in the paragraph. The legality of the issue has not been discussed and hence, we can eliminate option B. 

Option D fails to capture the fact that endogenous gene editing is not devoid of risks. 
Only option C captures the fact that  exempting endogenous gene editing is not desirable due to the risks involved. Therefore, option C is the right answer.