The recent arrest of two managers of a Chinese milk producer
serves as a salient reminder that the new food safety laws are
being enforced in China.
On 31 December 2009 the Xinhua news agency reported that
Shanghai Panda Dairy Company (Panda) was producing milk formula
that contained an unacceptably high level of the chemical melamine.
The arrest of the corporate representatives and two managers,
charged with producing and selling toxic milk powder, followed.
This latest finding of production of food tainted with dangerous
chemicals follows hot on the heels of the 2008 baby formula crisis
in which at least 6 babies died and in excess of 300,000 were left
ill. At that time Panda was found to have dangerous levels of
melamine in its milk products but was allowed to resume production
after undertaking to improve the quality of its products. Melamine
can artificially raise the level of protein in milk formula
products whilst reducing the cost of production. It can collect in
the human body causing kidney stones and eventually, kidney
In the wake of the 2008 crisis the Chinese government enacted
stringent food safety standards aimed at controlling the quality of
foods and providing harsh penalties, including criminal sanctions,
for those that break the law. The laws which came into force on 1
June 2009 had been criticised for dividing responsibility for the
monitoring of over half a million food producers amongst the
General Administration of Quality Supervision, Inspection and
Quarantine, the State Food and Drug Administration and the
Ministries of Health, Agriculture, Commerce and Industry, leading
to a sharing of responsibilities and a lack of inter-departmental
coordination. However, the latest response to the tainted products
produced by Panda is a positive sign that the Chinese State is
taking the issue of food safety seriously.
Further evidence of the seriousness with which China responded
to the 2008 crisis were the execution of a farmer and a milk
salesman found guilty of tainting milk products with melamine in
2008 and the arrest in December 2009 of three people suspected of
selling melamine tainted milk products in the Shaanxi province, who
all now stand accused of producing and selling toxic food. In
total, 21 people have been convicted for their roles in the 2008
crisis which led to the bankruptcy of China's largest dairy
manufacture, Sanlu Group, and the life imprisonment of its
The food safety standards do not allow food products to contain
any additives that are not approved by the State, allow for ongoing
inspection of food products, enable the State to order that
production of dangerous foods ceases and allow for product recalls.
In addition, the laws allow for consumers to be compensated up to
ten times the value of the food purchased if they have purchased
sub standard products.
With Chinese food exports growing, up from $4.5 billion in 1986
to $25.7 billion in 20061, the safety of food produced in China is
becoming an increasingly international issue and one that the
Chinese Government will continue to battle with in an industry that
is highly dispersed and where growth and market share may well be
placed above safety. Despite this, the quick reaction and
destruction of the tainted products produced by Panda offer
encouraging signs that health and safety standards are increasingly
at the top of the agenda for the Chinese State and are an area
where managers will continue to be forced to take personal
responsibility for the safety of the goods their companies
The impression that health and safety standards are not enforced
in China is misplaced and foreign companies operating in China
would do well to heed this latest warning.
A business can sometimes be a consumer, and enjoy the protection offered by consumer law.
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