In June of this year, China enacted a new Food Safety Law. It is stating the obvious to say that China's food safety is of relevance to the entire world and China food safety is the rare case where both foreign and domestic interests are united in wanting to solve a major problem within the Chinese system.

China's new food safety law takes the position that the food safety problem arises from inadequate central control and from a lack of clear standards and procedures. However, even if this were true, the measures adopted in the Law will not resolve these issues.

The Law created a Beijing based coordinating council called the National Food Safety Commission to coordinate five national level ministries that have day-to-day control over different phases of the food production process. Since the Law does not set out the structure or authority of the new Commission there is no reason to expect this approach will improve central control of the food safety problem. It does little more than create another layer of bureaucracy.

The new Law mandates additional rule-making to regulate every phase of the food production process, a complete review and assessment of current food safety issues, national standards for food quality and safety, and a unified national program for addressing food safety emergencies.

But the Law provides absolutely no details about any element of this program. There are no standards, no time-line, no budget, no procedure for obtaining the input of regulated parties and no procedure for resolution of disputes. It is not uncommon in China for laws to be adopted on controversial topics that leave nearly all of the details to later regulation. The usual result in China is that such regulations never appear, rendering the law essentially meaningless. That has so far been the fate of the standards and procedures portion of the Food Safety Law.

However, even if these difficult issues were to be resolved, the Law will not resolve the food safety problem in China.

Food safety cannot be enforced through government supervision and administrative sanction. Food safety standards function only where there is an effective system of private civil litigation that allows injured parties to take action independent of the government. As with most countries, China simply does not have the funding or expertise to hire qualified inspectors and regulators to enforce to the food safety system. China has over 200,000,000 farmers and over 500,000 food production companies. Its food production system is too vast to allow for meaningful inspection at all stages of the food production process.

The government can play an important role in setting the proper standard, but only when Chinese citizens can use China's court system to obtain damages will China's food safety likely markedly improve. China's tort law system is undeveloped and regulators strongly discourage its use in safety and health related matters.

The Food Safety Law is also not directed at the real problem. In a fundamental sense, China did not need a completely new set of standards and procedures. The previous standards would have been perfectly adequate had they only been enforced.

Chinese farmers and herders are poor and uneducated. Most operate at a loss and only survive by supplementing their income through nonagricultural activities. The same is true of most food processors, who sell into a partially price controlled market and who are frequently on the verge of bankruptcy. These people and businesses do not believe they have the luxury of being concerned with standards and rules and procedures. They make decisions based on day-to-day survival. They will, therefore, take many actions in violation of the law if they believe doing so will give them some financial benefit. They do not worry about the long term impacts. They are only concerned with survival today. In this situation, which is prevalent all over China, no amount of regulation and supervision will have any impact. They ignored the old and simple rules and we can expect the new rules will receive equal treatment.

Having said all this, there is one thing that does seem to be working with respect to China's food safety, at least on the high end and at least in the bigger cities. China's consumers are concerned about the safety of their food and they are hyper vigilant on this score. The food companies know this and they have stepped up their quality control monitoring and they are not shy about getting this word out.

What are you seeing out there?