Doing business in China: September 2008 Archives
By BBC World News
September 29, 2008
The makers of Cadbury chocolates have decided to recall 11 products from shops in Hong Kong.
The Asia-Pacific regional management of the British-based firm told the Hong Kong government that the recall was a precautionary step.
The government announcement did not specify whether the products had indeed been contaminated by the chemical.
Tens of thousands of babies have been sickened and at least four killed by Chinese milk tainted by melamine.
Cadbury Asia-Pacific said the 11 products were manufactured at their Beijing plant and distributed in Hong Kong.
The products include Cadbury Eclairs, dark and milk chocolate, hazelnut and praline chocolate, dark Chocettes, and products made specially for the Chinese New Year (in February).
Cadbury's Asia Pacific region includes Australia, New Zealand, India, Japan, Thailand, China, Malaysia, Indonesia, Singapore, the Philippines and South Korea. The recall order was so far only registered in Hong Kong.
"We appeal to the public to stop consuming the chocolate products concerned," said a spokesman for the government's Centre for Food Safety.
"We would alert the trade to stop selling the affected products," he added.
The Centre for Food Safety said it would be testing the products itself and was closely monitoring the situation.
China's reputation for food safety has nosedived since the revelations last month that milk products poisoned by melamine were responsible for causing renal problems in babies who drank the milk formula.
Indonesian concerns
In Jakarta, the Food and Drug Monitoring Agency was reported to have found traces of melamine in chocolate and biscuit products apparently made in China by Kraft Foods and Mars.
The two companies said they were investigating the claims, although their products had earlier been cleared of melamine tainting.
Some reports raised the possibility the products - including Oreo wafers, M&Ms and Snickers - could be counterfeit.
"We have asked our trade partners and retailers to suspend the sales of our products in accordance to the agency's order," the Mars spokesman in Indonesia, Bondan Ardi, told The Associated Press on Monday.
The companies involved said they would conduct their own tests.
Four babies have died and more than 53,000 children have so far been made ill by drinking contaminated powder milk in China.
The World Health Organisation (WHO) has meanwhile urged five countries to immediately recall all milk powder imported from China.
The scandal came to light earlier this month when baby milk powder from the Sanlu Group was found to contain the industrial chemical melamine.
Since then, at least 22 other companies have been implicated - and milk products made by the Yili, Mengniu and Bright Foods groups have been recalled both at home and abroad.
Melamine is used in making plastics and is high in nitrogen, which makes products appear to have a higher protein content.
Health experts say that ingesting small amounts does no harm but sustained use can cause kidney stones and renal failure, especially among the young.
Sin Chew Jit Poh (Malaysia) | MYsinchew.com
September 24, 2008
About the same time last year, I wrote an article titled "Souring of 'Made In China' Products" in this column to slam the poor safety of Chinese manufactured products. Despite the fact that my article was later greeted with a called-in condemnation from a reader claiming to be from China, I felt I had not done anything wrong. Based on the conscience and moral standarads a news commentator was supposed to have, I still had to pen the article although I knew it might infuriate some people, with the hope that readers would be suitably warned against dangerous products.
In just about a year, the toxic milk scandal happens in China, and has raised alarms in places from Hong Kong, Taiwan, Europe, America, to much of Asia. As the saying goes, a tiny spark could torch the entire forest. The scandal may have already dented the reputation and integrity China has worked so hard to establish during the recent Beijing Olympics.
In China, dangerous food products are by no means a novelty, with plenty of products not meeting the most fundamental hygiene requirements. Having said that, it is an utter shock to the world that toxic melamine has been immorally added to milk powder, almost the only food consumed by infants, putting millions of innocent little lives under serious threat.
Not one, but at least 22 companies have included melamine in their milk powder, while many other brands of dairy products have also been found to contain banned ingredients which could pose serious dangers to our body.
The vast variety of toxic foods, the intensity of their harms to infants, and the extent of influences they have on affected companies, have shocked the Chinese people worldwide. The moral depravation and a serious dearth of business ethics have also put the global Chinese community in deep embarrassment.
Since China introduced the open-door policy in the 1980s, "Made In China" products have found ready markets across the world. Chinese products are found in almost every store in the world, from mass produced poor quality products to luxurious outlets in the West, showing that faith in Chinese made products has been established in oversea markets.
Nonetheless, the foundation of such a great wall of faith is beginning to become shaky with news of flawed products continue to be reported in the media worldwide in recent years. And the most recent toxic milk scandal has dealt a further blow, perhaps a major one, on the already shaky faith in products with "Made In China" tags.
The Malaysian health ministry has also instructed to ban the import of all dairy products from China, including many that adults today loved when they were little kids. Before 22 September, many children were still munching the famous "Big Rabbit" milk candy imported from China.
The health ministry has sent enforcement personnel to confiscate "Big Rabbit" milk candy and other related products while issuing a ban on their imports, after Singapore has found melamine in the candy.
In other words, before this scandal is made public, "Big Rabbit" milk candy and other dairy products from China containing the toxic ingredient melamine have been selling in the local market "safely."
By Chris Buckley | REUTERS | via UNCENSORED Yahoo! News
September 22, 2008
The number of Chinese infants sick in hospital after drinking tainted milk formula doubled to nearly 13,000 and the country's top quality regulator resigned on Monday in the latest blight on the "made-in-China" brand.
Four deaths have been blamed on the toxic milk powder, which causes kidney stones and agonizing complications, and a string of Asian countries have banned or recalled Chinese milk products.
The official Xinhua news agency said in a brief statement that the country's quality chief, Li Changjiang, had quit in light of the case. "Li was the highest ranking official brought down so far by the dairy product contamination scandal," it said.
The Communist Party chief of Shijiazhuang, home to the Sanlu Group which made the tainted milk powder, has also been fired, Xinhua said, the latest official to loose their job for mishandling the incident.
The Health Ministry said the number of children hospitalized due to the milk powder contaminated with the industrial chemical melamine rose from a previously announced total of 6,244 -- which included many who had left hospital -- to 12,892, including 104 who were in a serious condition.
More than 1,500 had already left hospital and nearly 40,000 with milder symptoms "received clinical treatment and advice" before going home. The ministry did not explain the sharp rise.
The jump to more than 54,000 affected children was announced late on Sunday, escalating a scandal that has again shaken trust in Chinese products after last year's scares over toxic and shoddy goods from toothpaste and drugs to pet food and toys.
Melamine, used in making plastics, has also been found in cartons of milk and some dairy exports, but no illnesses from those sources have been reported.
Medical experts said on Monday that, as well as causing kidney stones, melamine could potentially cause far more serious complications by crystallizing and then blocking tiny tubes in the kidneys.
By Xin Fei | The Epoch Times
September 22, 2008
Deception that began four years ago continues, as the furore of tainted powdered milk causing kidney stones in babies spreads throughout China.
The public learned, earlier this month, that milk powder tainted with melamine has been found to be the cause of kidney stones in infants across China. At least four babies have died as a result.
In an incident four years ago, following the "Big Head Baby" media report in Fuyang City, Anhui Province, Sanlu's powdered milk had been blacklisted as inferior.
Shortly after, Sanlu was removed from the blacklist, by the communist regime's food administration, and reinstated.
Many people in Fuyang, knowing that Sanlu powdered milk had quality problems, suspected the company of manipulating the local and central government officials and using the Chinese state media in efforts to restore its reputation.
Media Reports Indicated No Crisis
A December 7, 2004 reprint of state-run Xinhua news by China Pharmaceutical News headline reading: 'Sanlu Powdered Milk: Turn Crisis into an Advantage' provided a clue that the group was aware the powdered milk had been tainted.
On January 16, 2004, Zhang Guangkui of Yongzhuang Village, Luzhai Town, Linquan County, Fuyang City, Anhui Province complained that the Sanlu infant powdered milk formula that he bought was tainted.
On April 22, the front page of local Fuyang newpaper Yingzhou Evening News printed a list of tainted powdered milk brands resulting from the spot check. Sanlu infant milk formula was 32nd on the list.
On the same day, Sanlu Group deputy general manager Zhang Zhenling and other high level staff members hurried to Fuyang City to negotiate with the local government. A statement said: " ... a mistake was made by related workers" and Fuyang City apologized.
A few days after April 22, 2004, markets all over the country were compelled to remove and seal Sanlu's powdered milk.
Sanlu's sales fell, its losses exceeded tens of millions RMB (around US$10 million).
On April 26, the Ministry of Public Health, State Administration for Industry and Commerce, General Administration of Quality Supervision, Inspection and Quarantine (AQSIQ) issued an emergency notice requesting local law-enforcing departments to allow normal sales of Sanlu powdered milk.
On the first working day after the "May 1" seven-day-long holidays that year, AQSIQ announced that as a result of a spot check, 30 companies producing powdered milk had been declared as safe.
Sanlu was the first one on the list.
Public Relations Crisis Management Efforts
According to a Xinhua News report in 2004, on April 27, Sanlu and several dozen dairy enterprises conducted good faith symposiums in several cities. The theme was 'Resisting Killer Powdered Milk'.
They jointly released the first 'Dairy Business Good Faith Pledge' in the country, firmly promising not to produce or sell inferior quality dairy products.
Within one day, Sanlu had notified 93 media nationwide, and 19 media removed Sanlu powdered milk from their blacklist reports.
On April 28, 2004, organized by Specific Association for Child Food, Chinese Society for Food Science and Technology, Sanlu and nine food security trusts donated 4,985 boxes of infant powdered milk to Fuyang City in an experimental bid for commercial enterprises.
After these events, in many business strategy documents and articles, Sanlu was used as model for managing crisis successfully.
In September 2008, when poisonous Sanlu powdered milk was first exposed, Sanlu vigorously denied any contamination in the powdered milk and attempted to redeem itself by citing conclusions given by the authoritative quality examination departments.
According to Tencent QQ financial channel report on September 11, Sanlu Group media department indicated;
"Sanlu is a brand product of powdered milk, the production is strictly in accordance with national standards and the product is qualified. Currently, there is no evidence indicating illness caused by Sanlu powdered milk."
Since the incident came to light last week, the Sanlu Group has continued to gloss over it and deny involvement, while passing the blame onto dairy farmers.
As pressure increases domestically and internationally, the communist regime's officials, at all levels, have ducked for cover saying that Sanlu knew the facts all along but failed to file a report.
The Associated Press | The Denver Post
September 11, 2008
PARIS -- First tainted baby milk, and now toxic chairs from China.
Customers in France who bought Chinese-made recliners are complaining of stinging allergic rashes and infections.
One customer, Caroline Morin, said Friday that she was stunned to learn her chair appears to have caused the skin problems she's suffered with for months. "You sit comfortably on something, and, in fact, you have a bomb under your butt," she said.
The French distributor, Conforama, warned clients in July that some of the chairs and sofas presented an allergy risk "in rare cases." It has withdrawn them from sale and now says the health problems were linked to an anti- fungal chemical in the chairs.
Conforama says it has severed its commercial ties with the Chinese supplier, Linkwise, and told its other suppliers to no longer use the chemical, dimethyl fumarate, to prevent mold.
Linkwise is based in the manufacturing hub of Dongguan in southern China.
A man who answered the phone at the company said Friday that it is working with the Chinese government's quality-inspection watchdog on the problem. He would not give details or his name.
From 24heures (Switzerland)
Quelque 600 canapés et fauteuils fabriqués en Chine et distribués en Suisse par la chaîne de magasins française Conforama peuvent provoquer de l'eczéma, en raison de sachets anti- moisissure. Trois personnes ont connu des désagréments alors que les meubles identifiés ont été retirés de la vente.
Au total, 1600 produits ont été vendus entre août 2005 et juillet 2007. Et 600 d'entre eux peuvent provoquer des allergies cutanées «parce qu'ils ont été produits à une certaine date», a indiqué jeudi à l'ATS le directeur du marketing de Conforama Suisse, Laurent Dubois.
Un courrier a été envoyé à 1500 clients et 250 meubles ont déjà été rendus par les clients. Trois cas d'eczéma sont déjà avérés à ce jour, a indiqué M. Dubois.
Hospitalisations en France
Selon une responsable du groupe Conforama en France, citée par l'AFP, le fournisseur chinois Linkwise a expliqué avoir mis plusieurs sachets anti-moisissure sur ces produits, au lieu d'un seul, en raison de la mousson.
Mais le rapport de cause à effet est «assez difficile» à établir, selon M. Dubois. «Certaines personnes peuvent s'asseoir sur ce fauteuil sans avoir de problèmes et d'autres, qui ont un métabolisme plus fragile, ont une réaction allergique», a-t-il aussi précisé. Un justificatif médical est demandé aux clients qui se manifestent.
By Ian Ransom | REUTERS | via UNCENSORED Yahoo! News
September 18, 2008
Hong Kong has ordered the recall of a Chinese company's products after milk, ice cream and yoghurt were found to be contaminated with melamine, the compound responsible for killing four children in a China health scandal.
Tainted milk powder produced in China has made thousands ill, and triggered sackings and detentions and rocked public trust already battered by a litany of food safety scares involving tainted eggs, pork and seafood in recent years.
Now the scandal has spread to milk, ice-cream and yoghurt ice-bars. Hong Kong ordered the recall of a Chinese company's products on Thursday after tests found that eight of 30 of its products, including milk drinks, were tainted with melamine.
The company, Inner Mongolia Yili Industrial Group Co Ltd, was a Beijing Olympic Games sponsor and is one of 22 Chinese firms implicated in the scandal.
By Graham Bowley | The New York Times
September 13, 2008
As part of an incentive package to persuade Costa Rica to shift its diplomatic recognition from Taiwan to China last year, China used the muscle of its enormous foreign exchange reserves, agreeing to buy $300 million of Costa Rican bonds, documents released in Costa Rica this week revealed.
The deal shows that China is using its $1.8 trillion in foreign exchange reserves, the world's largest such cache of foreign currency, to further its political goals, despite promises that it would not do so.
As China's economic might has risen in recent years, so has concern about its international reach, particularly in the United States. China is thought to be the largest foreign holder of United States government-backed debt, and bankers estimate that $1 trillion of China's total foreign exchange reserves are in American securities.
The terms of the agreement were meant to be kept secret, according to La Nación, a Costa Rican newspaper, but the government was forced by the constitutional court to publish the memorandum of understanding signed by both countries, as well as other documents. The court considered the information to be in the public's interest.
The memorandum, posted on the Web site of Costa Rica's Foreign Ministry, is dated June 1, 2007, the month that China and Costa Rica established diplomatic relations, and it is co-signed by Yang Jiechi, China's foreign minister.
The memorandum states that in return for Costa Rica's shutting its embassy in Taiwan and expelling Taiwanese diplomats, China agreed to buy $300 million in bonds.
It also agreed to give $130 million in aid to Costa Rica, as well as other incentives, including 20 scholarships each year for Costa Ricans to study in China.
The documents show that the Chinese State Administration of Foreign Exchange, the secretive organization that is the steward of China's foreign exchange reserves, agreed to buy $150 million in state bonds, with a term of 12 years and carrying an interest rate of 2 percent per year, in January of this year and a further $150 million in January 2009.
La Nación reported that the Costa Rican finance minister, Guillermo Zúñiga, had warned this week that the decision to make the details of the agreement public could jeopardize the purchase of the second set of bonds by China. It quoted the Chinese ambassador to Costa Rica, Wang Xiaoyu, as saying that China was now assessing the impact on relations between the countries.
By Esteban Mata | LA NACION, Costa Rica
13 de septiembre de 2008
El presidente de la República, Óscar Arias Sánchez, reconoció ayer que el Gobierno mintió sobre los detalles que mediaron en el inicio de las relaciones diplomáticas con la República Popular China.
"Aquí no ha habido ninguna mentira. La única mentira es cuando me preguntaron: '¿Es cierto que van a romper con Taiwán?', y yo dije que no", recordó el Presidente en una improvisada conferencia de prensa en su residencia en Rohrmoser
El mandatario se excusó de su falta a la verdad señalando que tanto Costa Rica como China tenían planeado anunciar el inicio de relaciones diplomáticas de forma simultánea.
Asimismo, Arias manifestó: "La inteligencia de Taipéi nos pilló en la mentira".
El Presidente habló del tema menos de dos horas después de haber vuelto al país ayer en la tarde, luego de una gira de dos semanas por Europa.
Arias se refirió a su viaje y después se ocupó de contestar las preguntas de la prensa sobre el secretismo y las mentiras a las que el Gobierno recurrió en el proceso de establecimiento de relaciones con China.
A destiempo. El anuncio sobre el inicio del vínculo diplomático con China -y, en consecuencia, la ruptura con Taiwán- se dio el 6 de junio del 2007, cinco días después de que los cancilleres de ambas naciones firmaron el lazo diplomático en Pekín.
Para llegar a este punto, los cancilleres Bruno Stagno y Yang Jiechi firmaron un "memorando de entendimiento", en el cual China prometió una cooperación económica al país por un monto de $430 millones.
A cambio, China pidió el silencio de Costa Rica sobre las condiciones de la ayuda económica y el cese inmediato de relaciones diplomáticas con Taiwán.
Esta situación fue alertada por el servicio secreto taiwanés en Taipéi días antes de que se hiciera público el anuncio, pero en suelo tico tanto Arias como el canciller Stagno señalaron que eran especulaciones de la prensa.
Más de un año después, Arias reconoce que el servicio secreto de Taipéi "nos pilló que era cierto que íbamos a romper con Taiwán".
En secreto. Esta información se mantuvo en secreto porque, de acuerdo con el propio Arias, así lo pidió el Gobierno chino.
Posteriormente, tras un recurso de amparo presentado por La Nación , un fallo de la Sala Constitucional obligó al Gobierno a revelar los datos.
"Yo estaba esperando ese fallo desde hace mucho tiempo, y lo dije: que ojalá la Sala nos obligara a decir a los costarricenses lo único que faltaba de decirles, que era el tipo de interés, que es del 2%", manifestó Arias.
En el paquete de ayuda económica, en el que se incluyó la compra de bonos de deuda pública costarricense por $300 millones, a un plazo de 12 años y con un interés del 2%, también se contempla una donación de $130 millones en ayuda social y la construcción del nuevo Estadio Nacional.
Ayer, a su vuelta de la gira de dos semanas por Europa, Arias insistió en que no hubo ninguna irregularidad en la venta de bonos de deuda pública a China por $300 millones.
"No hubo intermediarios y nadie se ganó una comisión, porque eso es lo que con toda mala fe quiso insinuar alguna gente", comentó.
La compra de bonos de deuda pública fue uno de los compromisos que adquirió el Gobierno chino para que Costa Rica rompiera una relación de 63 años con Taiwán, y está especificado en el memorando de entendimiento que firmaron los cancilleres de ambos países el 1.° de junio del 2007.
A pesar de eso, el presidente Arias dijo el 26 de octubre de ese año, en entrevista con este medio en un vuelo entre Pekín y Shanghái, que esa transacción era "una posibilidad", aunque sabía que desde el 1.° de junio era un hecho.
By Elizabeth Weise | USA TODAY
September 12, 2008
The FDA is working with state health agencies across the country to make members of Chinese-American communities aware of the danger.
Chinese newspapers report that some infant formula has been linked to kidney problems and kidney stones in babies in China because the formula contains melamine -- the same industrial contaminant from China that poisoned and killed thousands of U.S. dogs and cats last year.
Sanlu Group, the major Chinese dairy that produced the formula, has recalled 700 tons of the product, state Xinhua News Agency reported today.
No baby formula approved for use in the USA is manufactured in China, the FDA says. "We want to reassure the public that there's no contamination in the domestic supply of infant formula," says Janice Oliver, deputy of operations at the FDA's Center for Food Safety and Applied Nutrition.
In addition, no U.S. manufacturers or marketers of infant formula receive ingredients from China. "We contacted all of them," Oliver says.
The FDA is concerned that illegal infant formula may be sold in Asian and ethnic markets. It happened in 2004, when fake formula from China, which killed dozens of babies there, was found in at least one U.S. store. "None of this should be in the United States. We're not aware of anyone finding it here, but knowing that it happened once before, we want to get the word out," Oliver says.
By Andreas Lorenz | Der Spiegel (Germany)
September 03, 2008
Bao Tong, a former member of the Central Committee of the Chinese Communist Party, fell out of favor and wound up in prison. Now he lives under house arrest in Beijing, watched by the government because he continues to push for more democratic freedom.
Nowadays, it isn't easy to visit the old man who, less than 20 years ago, was one of China's most influential politicians. His former friends and colleagues now try to prevent him from meeting foreigners. They also try to keep him from talking to Chinese journalists and historians. Not even his friend, philosopher Liu Xiaobo, is permitted to see Bao Tong, who is considered a threat.
An army of agents from the Chinese Ministry of State Security forms a highly visible presence around the 24-story building where Bao Tong lives. They ask for identification, and a uniformed officer records the names of visitors in a notebook. He is polite and asks visitors to take a seat in the lobby. Electronic devices are assembled on his desk, an array of cameras hangs on the wall and a woman in a blue-and-white polo shirt runs the elevator.
A thin man with large glasses and wearing a blue shirt opens the door to apartment six, on the sixth floor. Bao Tong, 76, was a member of the Central Committee. In the 1980s he was in charge of the day-to-day affairs of the Chinese State Council, a position similar to that of the head of the German Chancellery. Bao wrote speeches for party chief Zhao Ziyang, who trusted him. The Communist Party leadership also asked him to think about ways to reform the political system. Bao's basic concept was that the party should withdraw from the business of governing and give up its omnipresent control. If Bao Tong's ideas had been accepted, the totalitarian communist system would have become more liberalized. Unfortunately, they were not.
When students, who favored such ideas, took to the streets of Beijing in the spring of 1989 to stage protests against corruption and demanded more democracy in sit-ins and rallies, Bao and Zhao begged the party's aging leaders not to use the army against the young idealists.
Instead of listening to Bao, patriarch Deng Xiaoping and his associates remembered Mao's famous statement that "political power grows out of the barrel of a gun." The tanks from the People's Liberation Army wheeled up to a position not far from Bao Tong's current apartment, and the soldiers were ordered to shoot into the crowd. Hundreds, if not thousands, of civilians -- most of them students -- died in those first few days of June 1989.
Zhao was held responsible for the "counterrevolution" and lost all his positions. He was placed under house arrest until his death in January 2005.
Bao Tong, accused of "betraying state secrets and spreading counterrevolutionary propaganda," spent seven years in solitary confinement at Qincheng Prison outside Beijing. After his release, he was periodically placed under house arrest and was, of course, under constant surveillance.
But none of this kept him from voicing his opinions. In August 2007, he was one of 42 intellectuals to write an open letter to the Communist Party leadership demanding the observance of "universal human rights" and public scrutiny of funding for the Beijing Olympics.
Today he lives in a bright, orderly apartment, the walls decorated with watercolor paintings and a family photograph with his granddaughter. The old Jingxi Hotel, the meeting place of the Central Committee, to which he once belonged, is around the corner.
"I would like to see the Olympic spirit of fair play spread into Chinese society," Bao says elaborately. China's market economy, he adds, is "not real, because it is still controlled by the government." And while China may call itself a "people's republic," says Bao, it has no "democratic elections of freedom of opinion." Bao believes that if the country turns into a "true republic" and a real "market economy," then "the Olympic Games in our country will not have been for nothing."
But the aging Marxist is not very optimistic. In his view, the country's new middle class, which is satisfied with condominiums, cars and laptops and is unwilling to challenge one-party rule, is "short-sighted." This, says Bao, is because the stability that these people seek and that the Communist Party wishes to guarantee them, cannot be preserved "if the rights of ordinary people are constantly being violated." According to Bao, the police are quick to clamp down as soon as anyone demands his rights. "I too favor stability, but it should be stability on the basis of fairness and the constitution."
By Edward Wong | The New York Times
09 September 2008
Local governments in a Muslim desert region in western China have imposed strict limits on religious practices during the traditional Muslim fasting month of Ramadan, which began last week, according to the Web sites of four of those governments.
The rules include prohibiting women from wearing veils and men from growing beards, as well as barring government officials from observing Ramadan. One town, Yingmaili, requires that local officials check up on mosques at least twice a week during Ramadan.
The local governments administer areas in the western part of Xinjiang, a vast autonomous region that is home to the Uighurs, a Muslim Turkic people who often chafe under rule by the ethnic Han Chinese. In August, a wave of attacks swept through Xinjiang, the largest surge of violence in the region in years. Some local officials blamed separatist groups for the instability, and the central government sent security forces to the area.
The limits on religious practices put in place by local governments appear to be part of the broader security crackdown. The areas affected by the new rules are near Kuqa, a town struck by multiple bombings on Aug. 10.
It was unclear whether the rules would be relaxed after Ramadan, an observance that some Islamic extremists have used elsewhere as a symbolic backdrop for attacks on their perceived enemies. It was also unclear how the Chinese authorities intended to enforce the rules, which appeared to run the risk of antagonizing devout Muslims who present no obvious security threat.
The Web site of the town of Yingmaili lists nine rules put in place to "maintain stability during Ramadan."
They include barring teachers and students from observing Ramadan, prohibiting retired government officials from entering mosques and requiring men to shave off beards and women to doff veils. Mosques cannot let people from outside of town stay overnight and restaurants must maintain normal hours of business. Because of the sunrise-to-sunset fasting, many restaurants would normally close during daytime for Ramadan.
By Don Lee | The Los Angeles Times
September 01, 2008
Lawsuits filed by eight Chinese firms alleging collusion by the government ministry could test the country's new anti-monopoly law.
China's product quality and food safety agency came under pressure last year after Chinese businesses exported tainted pet food and lead-laden toys. Now it is under fire from domestic companies.
In the last month, eight Chinese firms have filed lawsuits against the agency, accusing it of stifling competition by colluding with a business in which it had a financial stake.
The lawsuits could test China's new anti-monopoly law, which took effect Aug. 1. Among its provisions, the law prohibits abuse of government administrative powers that restrain competition, thus opening up for legal challenges the commercial activities of government bodies and officials.
The complaints by the eight companies, which supply product-authentication and tracking systems, were brought against China's General Administration of Quality Supervision, Inspection and Quarantine, or AQSIQ. The agency is a ministerial-level entity responsible for ensuring the quality and safety of many products, including food.
"This is more than just a lawsuit, it's an anti-corruption fight against AQSIQ," said Zhou Ze, the attorney at Beijing-based Zhanda Law Firm who filed the suits. "It will be a warning to other government agencies, helping them to improve operations and how they should use their public rights and power."
Zhou contends that since 2005, AQSIQ has been heavily promoting an electronic bar-code and Internet-based authentication system developed by China Credit Information Technology Co. Late last year the agency said that to improve product quality and safety it would require businesses in food and eight other industries to join China Credit's network. Network users are charged an annual fee and incur charges for specific services. As of July, nearly 67,000 companies had signed up with China Credit, AQSIQ reported.
AQSIQ owns 30% of China Credit, according to public filings with the Hong Kong Stock Exchange that were made by CITIC 21CN Co., a Hong Kong firm that owns 50% of China Credit. The remaining 20% is held by China Huaxin Telecom.
All three share in China Credit's profit, the filings show.
AQSIQ did not respond to telephone calls and a fax last week requesting comment. Local media have raised questions about the joint venture. Over the weekend, the agency said on its website that it did not invest any money in China Credit, nor did it earn a penny from it. AQSIQ said it had made plans to divest its stake.
Chinese regulations prohibit a government agency from being involved in a business operation, said Wang Xixing, professor of constitutional and administrative law at Peking University Law School. "It is definitely not allowed," he said.
Yet in practice, this remains a gray area in China. Some government operations have subsidiaries or affiliated entities that are engaged in commercial activity. The Ministry of Public Security, for example, has a research institute and under it is a company marketing traffic-control products.
In an interview, Zhou said he filed the first suit Aug. 1 on behalf of four Beijing businesses. He followed up with additional complaints for similar companies in Shanghai, Nanjing, Shenzhen and Guiyang.
Zhang Zeyi, general manager of one of the four Beijing companies, CSDN Alliance Information Technology Co., said that for the last three years he and the other plaintiffs had complained to AQSIQ about its selection of China Credit for the lucrative project.
"All the government [AQSIQ] employees, from top to bottom, are involved in promoting [China Credit's] system," Zhang said.
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