PULLING A FAST ONE ON FAST FOOD

By+Wang+Hairong

On the morning of July 29， customers arriving at the McDonalds in the Ganjiakou area of Beijings Haidian District were disappointed to find that the store served nothing more than drinks and taro， pineapple and potato pies.

“Chicken nuggets and hamburgers are not available，” said a female clerk， pointing at prominent signs posted on every cash register on the check-out counter， which stated McDonalds commitment to food safety and said that availability of these products will be resumed as soon as possible.

On July 28， McDonalds announced that it had stopped purchasing products from all Husi food factories in China； on the evening of July 20， Shanghai-based Dragon TV aired a program exposing Shanghai Husi Food Co. Ltd. for using expired and substandard meat.

Eighteen tons of frozen chicken skin and breast that expired half a month ago were ground up， coated with layers of starch paste and fried into the chicken nuggets that would later be shipped and served at McDonalds restaurants.

Veal chops that expired seven months ago were repackaged， with the original expiration date prolonged for another year. Meat products of inferior quality were blended into and sold as regular products.

These images， along with others shot at Shanghai Husi Food Co. Ltd.， have shocked Chinese consumers， especially those who frequent Western fast food chains.

Shanghai Husi was the main meat supplier for a number of big-name international fast food brands with strong presence in China. The scandal has dragged a number of them into the fray with it—including McDonalds， Pizza Hut， Kentucky Fried Chicken （KFC） and Burger King.

Western fast food chains are popular among Chinese consumers. China is the thirdlargest market by number of restaurants for McDonalds and the top market by revenue for Yum！ Brands—which owns Pizza Hut and KFC， according to Xinhua News Agency. Yum！ Brands， Inc. also announced that its KFC and Pizza Hut restaurants had stopped using meat supplied by OSI China Holding Co. Ltd. （OSI China）， which is a subsidiary of OSI Group， a U.S.-based global food processor. In addition to Shanghai Husi Food Co. Ltd.， OSI has a number of factories in other part of China such as Henan， Shandong， Hebei， Yunnan， Fujian and Guangdong provinces.

Undercover reporters from Dragon TV broke the story， which took them two and half months to capture on footage.endprint

Responses

After the scandal was exposed， OSI China posted a statement from Sheldon Lavin， Chairman， CEO and owner of the OSI Group on its website. Lavin wrote， “What happened at Husi Shanghai is completely unacceptable. I will not try and defend it or explain it. It was terribly wrong， and I am appalled that it even happened in the company that I own.”

He then apologized on behalf of Shanghai Husi Food and the OSI Group. “I sincerely apologize to all our customers in China. We will bear responsibility for these missteps， and will make sure that they never happen again. That is my commitment.”

Lavin said that local Chinese authorities have inspected OSI Groups other facilities in China and have not found any issue.

On July 26， the OSI Group declared that it will withdraw all products manufactured by Shanghai Husi Food from the marketplace.

The multinational company said that it is“conducting a thorough internal investigation into any possible failures on the part of current and former senior management” and a new management team has been brought in to China to ensure that operations run effectively.

At 7：30 p.m. on July 20， shortly af-ter the program was aired， investigators from Shanghai Municipal Food and Drug Administration （Shanghai FDA） arrived at Shanghai Husi Food.

Law enforcement personnel ordered the company to suspend production， and confiscated all paper and electronic production records， as well as all ingredients and finished products in the warehouses. They also questioned staff and talked to the head of OSI China.

Meanwhile， the Shanghai FDA launched an all-out inspection on meat producers and fast food chains in the city and demanded fast food chains remove any potentially contaminated or affected products from their shelves.

On July 22， the food and drug safety watchdog released its preliminary investigation report， saying that Shanghai Husi Food was suspected of illicit production. It had talked to 22 fast food companies and found that the problematic products had been supplied to nine of them. The authority already seized five batches of meat products containing a total of 5，108 boxes including chicken nuggets， veal chops and meat pies. Seized products weighed approximately 100 tons in total.

Gu Zhenhua， Deputy Director of Shanghai FDA， said that they found some of the companys malpractices were not the choice of any single individual， but instead were that of the management.endprint

On July 26， the Shanghai FDA released updated investigation results. As of July 25， it had inspected 1，181 companies producing or selling food， and seized 144.1 tons of tainted products in total.

In addition， the Shanghai FDA revealed that it had also found new evidence showing Shanghai Husi Food changed the production date of around 32 tons of meat pies in 4，396 boxes from May 2013 to January 2014. The meat pies expired in February 2014， but by July 26， approximately three quarters of them had been sold， mostly to buyers out of Shanghai.

Shanghai Husi Foods quality manager told the Shanghai FDA that using expired ingredients had been the companys policy for years， and the practice was permitted by the companys top executives.

Dragon TVs reporters found that the company kept two sets of production records， with one for internal use and another one containing tampered data for external use.

On July 23， Shanghai police detained five people at Shanghai Husi Food， including a top executive and a quality manager.

Food and drug administrations in other places of China have also beefed up safety inspection.

According to the Zhejiang Food and Drug Administration， as of July 22， 48 tons of tainted food materials had been removed from McDonalds and Pizza Hut franchises in the province and sealed up. No KFC restaurants in the province used meat supplied by Shanghai Husi Food.

That same day， a total of 10.23 tons of problematic products were found in Sichuan Province， according to the Sichuan Food and Drug Administration.

On July 23， Guangdongs Pizza Hut and Burger King restaurants respectively sealed up 23.59 tons and 4.02 tons of expired products containing meat supplied by Shanghai Husi Food， according to the Guangdong Food and Drug Administration.

Problematic meat products were also discovered in some other provinces such as Shandong and Gansu， but the amount was comparatively smaller.

The Beijing Food and Drug Administration also demanded all fast food chains in the city immediately intercept or quarantine all food materials produced by Shanghai Husi Food. Starting July 22， the Beijing authority tightened supervision over more than 2，000 chain food and beverage companies in the city， as reported by Beijing Times.

Blind spots

In recent years， Chinas food industry has already seen a number of scandals， including melamine-tainted baby formula milk， clenbuterol-contaminated pork and food cooked with recycled “gutter oil.”endprint

Foreign fast food chains have not been immune to food safety scandals， either. For instance， in late 2012， Shanxi-based Suhai Group， a supplier to major fast food chains such as KFC and McDonalds， were reported as feeding antibiotics and other additives to prevent chickens becoming sick and making them grow faster. The time for one of their chickens to grow to maturity took only 45 days while normally the process takes months. Early in 2005， KFC was caught adding carcinogenic dye to their food to make it look more appealing.

The 2008 melamine-tainted baby formula milk scandal caused at least six infant deaths and illness of more than 300，000 others. It prompted the Central Government to attach great importance to food safety regulation. In 2009， a food safety law was adopted in China.

In 2013， the government revamped its food safety regulatory system and created an over-arching agency， the China Food and Drug Administration （CFDA）， to oversee food safety.

Previously， food safety regulation was performed by several government agencies. For instance， the State Food and Drug Administration （SFDA）， the predecessor of the CFDA， oversaw food safety in the catering industry， whereas the General Administration of Quality Supervision， Inspection and Quarantine supervised food safety in the production process and the State Administration for Industry and Commerce monitored the food distribution process. Poor coordination among these organizations was blamed as the source of regulatory loopholes.

After the restructure， the CFDA integrated the food safety regulatory functions of related government departments to ensure more effective oversight. In 2013， China also started procedures to amend the Food Safety Law. The draft was adopted in principle at an executive meeting of the State Council on May 14.

Highlights in the amendment include implementing whole-process management in food production， circulation and consumption， holding local government leaders and regulatory personnel responsible， establishing food safety standards and risk assessment and evaluation standards， as well as rewarding whistleblowers and setting up food safety insurance. The draft will be further amended and then sent to the National Peoples Congress for deliberation.

After Shanghai Husi Food was exposed as using expired meat， people could not help wondering why the problems had to be exposed by undercover reporters rather than food safety regulators.endprint

According to analysis done by Beijing News， even though the CFDA assumes much more responsibility than the SFDA did， its staff has not increased. A district-level FDA in Shanghai usually has 20 to 30 staff members， making it difficult for them to monitor so many food companies personally. Currently， they mainly supervise food companies by examining their paperwork. Moreover， some regulatory departments may relax supervision of foreign companies.

In addition， large food companies tend to restrict access to their production facilities. One undercover reporter from Dragon TV told Beijing Youth Daily that FDA inspectors were usually required to change clothes and sanitize themselves before entering the plant. The process took about half an hour， which was enough for workers to cover up anything incriminating.

It was reported that when Shanghai FDA investigators arrived at the scene on the night the scandal was aired by Dragon TV， they were stopped by security guards at the main entrance. They were made to wait for about 40 minutes before being admitted into the plant.

“Of the food safety cases exposed all over the world， few were found out by the government， while most were disclosed by employees， rivals or consumer rights protection organizations，” Feng Wenxi， a lawyer specializing in food safety issues told Guangdong-based Southern Weekly.

Actually， before sending undercover reporters to Shanghai Husi Food， Dragon TV was tipped off about the illicit practices of the food company by a former employee who had been fired.

But in many cases， people are reluctant to oust law breakers out of fear of retaliation.

In 2011， the State Council issued a circular on setting up an award for food safety whistleblowers. According to Sun Xiaomin， a professor at Shanghai-based Tongji University， 31 provincial-level administrative units in China have set up awards for food safety watchdogs.

In 2013， 784 such awards were granted in Shanghai. Shanghai FDA is taking measures to encourage whistleblowers to speak up， an unnamed official told Southern Weekly.

On July 27， the Shanghai Municipal Government held a special meeting on the incident. The meeting was chaired by Han Zheng， a member of the Political Bureau of the Central Committee of the Communist Party of China and Party Chief of Shanghai. Han stressed that government regulatory departments must exercise the strictest supervision over food safety.endprint

Han praised the media for its role in uncovering the illicit practice of Shanghai Husi Food， and said that reporters and whistleblowers will be protected. “Any company breaking the law must be severely punished according to law，”he said.

Legal penalty

Penalties for malpractices such as producing or selling putrid， deteriorated， spoiled food or expired food are specified in Article 85 of Chinas current Food Safety Law.

According to the article， regulatory departments should confiscate illegal gains， illegally produced or distributed food， as well as utensils， equipment， raw materials and other articles used.

In addition， perpetrators that have produced less than 10，000 yuan （$1，587） worth of food illegally shall pay a fine between 2，000-50，000 yuan （$317-7，937）， while those having illegally produced food worth more than 100，000 yuan（$15，873） shall pay a fine that is between five to 10 times the value of such food produced. If the circumstances are serious， the violators license will be revoked.

Article 143 of Chinas Criminal Law also stipulates that “Whoever produces or sells food that is not up to hygiene standards， thus putting consumers at risk of food poisoning or diseases caused by food-borne bacteria， shall be fined between half and two times the amount of earnings from sales.”

The article also states that such violators can be sentenced to prison terms ranging from criminal detention of no more than three years to life imprisonment depending on the seriousness of the harm done.

Some people think that these penalties are not severe enough to deter food safety misconduct. China Youth Daily analyzed 2，000 messages posted within two days after the Shanghai Husi Food scandal was exposed. About 20.1 percent of these messages were calls for more severe punishment.

According to China Youth Daily， the draft amendment on the Food Safety Law has raised the maximum penalty for such misconduct to 30 times the value of illegally produced or distributed food.endprint