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Monday, October 3, 2016, 17:50

OSI Group fined US$3.6M in 2014 meat scandal

By Xinhua

OSI Group fined US$3.6M in 2014 meat scandal
On July 20, 2014, investigators from China FDA investigating Shanghai Husi Food Co., a factory of US food provider OSI Group, in Shanghai. ( STR / AFP)

HONG KONG — The Chinese units of a former meat supplier for McDonald's and KFC China have been fined more than US$3.6 million for selling expired meat in a fast food safety scandal that erupted two years ago.

It's the latest fallout for OSI Group after a Shanghai TV station reported in 2014 that the company repackaged old beef and chicken under fresher expiration dates.

In a notice posted on its website , the Shanghai Municipal Food and Drug Administration said Monday that district market regulators fined Shanghai Husi Food Co. about 17 million yuan (US$2.5 million).

Husi parent OSI Group's China office was hit with a separate fine of 7.3 million yuan (US$1.1 million).

The district market regulators have also added the two companies to a blacklist of those who have committed serious legal violations, meaning stricter regulations in the future.

In a statement, the two companies accepted the punishment and promised to pay the penalty on time. Husi is a former supplier to major fast food chains including McDonald's and Yum! Brands KFC and Pizza Hut.

The case was first exposed after a local TV station reported in July 2014 that Shanghai Husi had supplied products tainted with reprocessed, expired meat to a string of fast food chains and restaurants across China.

Husi and OSI will also face tighter scrutiny from the regulator, though specifics weren't given.

The penalties come after a Shanghai court's ruling in February that two local units of Aurora, Illinois-based OSI sold the tainted meat and fined them a total of 2.4 million yuan. The court also sentenced 10 employees to prison, one of them Australian.

The company appealed the ruling, but the regulator's notice said the appeal was rejected in July.

Food safety remains a concern for Chinese consumers despite promises from the government to step up enforcement. Other recent high-profile scares include tainted baby formula, fake meat and fruits and even seafood pumped with gelatin.

After the report by Shanghai's Dragon TV aired, Husi customers in China including McDonald's Corp., Yum Brands Inc.'s KFC and Pizza Hut restaurants and Burger King Corp. stopped using its products. The company was forced to lay off 340 workers and the chairman apologized.

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