Issue No. 2 | June 26, 2017

Guiding Case No. 70:

Food and Chinese Medicine

Dr. Mei Gechlik

Zhaoyi (Troy) Song*

The blurred distinction between food

and Chinese medicine may easily lead to

food safety lawsuits. To avoid being

entangled in the plethora of unclear

standards as illustrated in Guiding Case

No. 70, businesses would be wise to

seek official approval for treating new

edible substances with pharmacological

potential as “new food raw materials”.

Yet China’s new law on Chinese

medicine and related (2016–2030)

strategic plan to promote Chinese

medicine around the world, especially in

countries participating in the Belt and

Road Initiative, should make these

businesses ponder whether identifying

such new substances as “Chinese

medicine” may be a better option.

is Founder and Director of the China

Guiding Cases Project (“CGCP”). She

teaches the course “China Law and

Business” at Stanford Law School. She

is admitted as a barrister in England,

Wales, and Hong Kong and is a member

of the Bar in New York and the District

of Columbia. She received her Doctor

of Science of Law (JSD) from Stanford

Law School and her MBA in Finance

from the Wharton School at the

University of Pennsylvania.

Guiding Case No. 70 (“GC70”),1 released in December

2016, reveals the complexity of China’s food industry

regulatory framework. In the adjudication of a food safety

case, a court often has to go through multiple steps to

determine whether a substance is prohibited from being

included in the food at issue. The prohibition may be in the

form of legal provisions or numerous lists prepared by

various authorities. GC70 illustrates how the court went

through these steps. The substance the defendants were jailed

for adding into food was not specifically included in relevant

regulations, official lists, standards, etc. It was, however,

held to be toxic and harmful because experts’ tests and reports

confirmed that it possessed the same attributes, and caused

the same harm, as substances recorded on such official lists.

Facing such a complicated regulatory framework, food

production businesses would be wise to make sure that

anything added into food is explicitly allowed by Chinese

law. For example, while drugs are generally prohibited by the

Food Safety Law of the People’s Republic of China2 (the

“Food Safety Law”) from being added into food, a certain

type of Chinese medicine is allowed. Unfortunately, an

official catalogue of these exempt Chinese medicinal

materials remains to be issued, despite being years in the

drafting.

The lack of a final version of this catalogue is

undesirable, but innovative food production businesses can

ensure that new edible substances with

pharmacological potential are acceptable by seeking

official identification of these substances as “new

food raw materials”. With this approach, not only

does the new edible substance have a more firm

legal footing, helping to avoid food safety litigation,

but the added novelty may open up more avenues,

or create a new niche, in China’s enormous food

market, leading to yet more business opportunities.

The release of the new Law of the People’s

Republic of China on Chinese Medicine3 (the “Law

on Chinese Medicine”), however, affords yet

another approach. As a significant step taken by

Chinese leaders to implement their long-term plan to

promote Chinese medicine inside and outside the

country, the new law calls on innovative food

production businesses to think strategically: would

identifying an edible substance with

pharmacological potential as a type of Chinese

medicine potentially yield more profits than

identifying it as a “new food raw material”?

Guiding Case No. 70

In GC70, the defendants were found guilty of

the crime of producing and/or selling toxic and

harmful food as provided for in Article 144 of the

Criminal Law of the People’s Republic of China4

(the “Criminal Law”) because they added a “toxic

and harmful non-food raw material” into food5 they

produced and sold and/or knowingly sold food into

which a “toxic and harmful non-food raw material”

had been added.6

The substance added was buformin

hydrochloride. In determining that the chemical

was a “toxic and harmful non-food raw material”,

the court relied on a judicial interpretation

concerning the adjudication of food safety cases (the

“Interpretation”).7 The court noted that buformin

hydrochloride was neither “prohibited by laws and

regulations from being added and used in food

production and operation activities” nor recorded by

the authorities on the List of Non-Edible Substances

That May Have Been Unlawfully Added to Food 8 or

the List of Substances That May Have Been Illegally

Added to Health Food 9 (the “Lists”) (Article 20,

Items 1–2 of the Interpretation). The court also

found that buformin hydrochloride did not fall

within the category “pesticides, veterinary drugs,

and other toxic and harmful substances prohibited

from being used as announced by the relevant

department of the State Council” (Article 20, Item 3

of the Interpretation). The chemical was finally

found to fall within the catchall provision of Article

20 of the Interpretation—“other substances that

endanger human health”—because, according to

Article 21 of the Interpretation, “inspection reports

in combination with relevant materials, including

expert opinions” bore out the finding.

To guide courts handling similar subsequent

cases, the SPC distilled the above reasoning into the

“Main Points of the Adjudication” section of GC70,

which essentially provides that “although a

substance added by an actor in food production and

is an Assistant Managing Editor of the CGCP. He is

an incoming trainee solicitor of an international law

firm and qualified as an associate of the Charted

Institute of Arbitrators. He is scheduled to graduate

from the LL.B. program at Fudan University Law

School in the summer of 2017.

2

operation [activities] is not on [the Lists]”, the

substance should still be determined to be a “toxic

and harmful non-food raw material” as provided for

in Article 144 of the Criminal Law “if the substance

possesses the same attributes as those substances

recorded on the aforementioned lists and the

substance can be determined, according to related

materials, including inspection reports and expert

opinions, [to cause] the same harm to human

bodies”.

A Catalogue of Food–Chinese Medicinal Materials

The multiple steps taken by the court in GC70

provide a glimpse of the complexity of China’s food

industry regulatory framework. To avoid being

entangled in the web of legal rules and official lists,

food production businesses naturally turn to what is

explicitly allowed

by law. An example

concerns the use of

drugs in food.

While drugs are

generally banned

from being added into food, Article 38 of the Food

Safety Law provides for an exception:

[…] but substances which are

traditionally both food and Chinese

medicinal materials may be added.

The catalogue of substances which

are traditionally both food and

Chinese medicinal materials shall be

formulated and published by the

health administration department of

the State Council in conjunction with

the food and drug administration

department of the State Council.

The above exception is consistent with Article 150

of the Food Safety Law, which defines “food” as

follows:

All kinds of finished products and raw

materials for people to eat or drink, as

well as items which are traditionally

both food and Chinese medicinal

materials, excluding items used for the

purpose of treatment. (emphasis added)

The recognition of substances which are

traditionally both food and Chinese medicinal

materials reflects the deeply ingrained view among

Chinese that “the source of medicine and food is the

same” (“药食同源”).10

In 2014, the Catalogue of Substances Which

Are Traditionally Both Food and Chinese Medicinal

Materials (the “Catalogue”), together with related

administrative measures,11 was released in draft

form for comment. Once adopted, the

administrative

measures will

replace the

Administrative

Measures on

Health for

Prohibiting Medicine from Being Added into

Food.12 Similarly, the Catalogue, which includes

just over 100 substances, is expected to replace the

List of Varieties That Are Both Food and Medicine,

which has 87 substances.13

According to the draft administrative

measures, “substances which are traditionally both

food and Chinese medicinal materials” are “parts of

animals and plants that can be used (including food

raw materials, spices, and condiments)”, the oral

consumption of which is part of “traditional eating

habits”, and which have been listed in the “national

standards for Chinese medicinal materials

(including the Pharmacopeia of the People’s

Republic of China14 and related standards for

Chinese medicinal materials)” (Article 2). Further,

[W]ould identifying an edible substance with

pharmacological potential as a type of Chinese

medicine potentially yield more profits than

identifying it as a “new food raw material”?

3

to be included in the Catalogue, a substance needs

to meet a few other requirements, including “being

recorded as edible in literature on Chinese medicine

and not having been found to be toxic” (Article 6).

Unfortunately, both the Catalogue and the

related administrative measures remain in draft form

for comment.

“New Food Raw Material” vs. “Chinese Medicinal

Material”

The lack of a final version of the Catalogue

renders any attempt to build a legal argument upon

the definition of the term “substances which are

traditionally both food and Chinese medicinal

materials” ineffective. For example, a party accused

of adding a “toxic and harmful non-food raw

material” into food may want to argue that the

substance added is not “non-food” because it is a

substance which is “traditionally both food and

Chinese medicinal materials”—a type of food as

provided for in Article 150 of the Food Safety Law.

But the defense is weak, because the Catalogue, the

only authoritative

document that lists these

substances, does not exist.

To avoid such

pitfalls, it is wise for

innovative food production

businesses to take proactive

steps by seeking official approval for identifying

new edible substances with pharmacological

potential as “new food raw materials”. According

to the Administrative Measures for the Safety

Review of New Food Raw Materials,15 “new food

raw materials” are various items (e.g., “animals,

plants, and microorganisms” and “ingredients

extracted from animals, plants, and

microorganisms”), the oral consumption of which is

not part of the “traditional eating habits in

China” (Article 2). In turn, “traditional eating habits

[in China]” means that “a certain type of food has

been produced or traded as standard or non-standard

packaged food in a province for over 30 years and

has not been listed in the Pharmacopeia of the

People’s Republic of China” (Article 22). In

addition to a few other requirements, “new food raw

materials” cannot be “genetically engineered foods,

health foods, or new varieties of food

additives” (Article 23). As of 2016, more than 100

items, such as Panax Ginseng C.A. Meyer (人参(人工种植); Announcement No. 17 of 2012), have

been approved as “new food raw materials”.16

Seeking to identify a new substance as a “new

food raw material” also makes sense from a

business perspective, as the added novelty may open

up more avenues, or create a new niche, in China’s

enormous food market. China’s food market is the

largest in the world, with a valuation of over USD 1

trillion.17 Food exports and imports each have

values in the tens of billions of dollars.18 With the

population still steadily increasing (projected to

reach approximately 1.4 billion by 2022) and

incomes rising (from a gross national income per

capita of USD 940 in 2000 to USD 7,900 in

2015),19 China’s demand for food will likely

continue to be strong.

The above considerations, however, are

complicated by the recent release of the Strategic

Plan for the Development of Chinese Medicine

(2016–2030)20 (the “Strategic Plan”) and the

promulgation of the new Law on Chinese Medicine.

The promulgation of the new Law on Chinese Medicine and

related (2016–2030) strategic plan demonstrate the Chinese

leaders’ determination to promote Chinese medicine, an

important heritage of humankind, on a large, global scale.

4

According to the Strategic Plan, in 2014, there were

more than 3,000 enterprises producing Chinese

medicine in China and the total output value of the

Chinese medicine industry was RMB 730.2 billion.

On this strong foundation, Chinese leaders plan to

achieve various goals by 2020 (e.g., raising the total

output value of the Chinese medicine industry to

account for more than 30% of that of the

pharmaceutical industry) and 2030 (e.g.,

consolidating China’s leading position in the

development of traditional medicine in the world).

Specifically, the Strategic Plan emphasizes the need

to promote the “combination of Chinese and

Western medicine”. It also states that there is an

“urgent need to promote the innovative and overseas

development of Chinese medicine” to further the

development of the Belt and Road Initiative,21

China’s going-global plan that has expanded to

embrace over 80 countries that together account for

over 45% of the global economy by GDP.22

In less than a year after the release of the

Strategic Plan, the Law on Chinese Medicine was

promulgated to, inter alia, require that the

development of Chinese medicine be included in the

national economic and social development plans

prepared by people’s governments at or above the

county level (Article 4). In addition, the law

provides for the establishment of a system to

evaluate “authentic regional Chinese medicinal

materials” to ensure their good quality (Article 23)

as well as a new regulatory framework for

promoting compound Chinese medicine

preparations originating from “famous ancient

prescriptions” (Article 30).

In view of these opportunities and the fact that

the number of officially-recognized Chinese

medicinal materials recorded in the Pharmacopeia

of the People Republic of China has increased from

65 in 1953 to 618 in 2015 and is still growing,23

innovative food production businesses must

thoroughly consider whether identifying an edible

substance with pharmacological potential as a type

of Chinese medicine, rather than as a “new food raw

material”, would be a better business move in the

long run.

Guiding Case No. 70 found a way to overcome hurdles in China’s unclear regulatory framework for

the food industry. This approach is useful, but it should be regarded as an interim solution. China needs a

clear legal framework for regulating food and Chinese medicine, especially because some Chinese

medicinal materials are allowed as additions into food. A finalized, authoritative Catalogue of Substances

Which Are Traditionally Both Food and Chinese Medicinal Materials should be issued without further

delay.

The promulgation of the new Law on Chinese Medicine and related (2016–2030) strategic plan

demonstrate the Chinese leaders’ determination to promote Chinese medicine, an important heritage of

humankind, on a large, global scale. Businesses may seize the opportunity to develop more Chinese

medicinal materials, but their enthusiasm will be curbed if the relevant regulatory framework is unclear.

While they do not expect clear legal standards in this complicated area to be low-hanging fruit, such

standards should not be as difficult to find as wild ginseng on tall mountains.

5

Endnotes

* The citation of this China Cases InsightTM is: Dr. Mei Gechlik & Zhaoyi (Troy) Song, Guiding Case No. 70: Food

and Chinese Medicine, Stanford Law School China Guiding Cases Project, China Cases InsightsTM, Issue No. 2, June

26, 2017, http://cgc.law.stanford.edu/commentaries/2-insights-2017-gechlik-song. This piece was edited by Dimitri

Phillips and Dr. Mei Gechlik; layout and design by Jacklyn Fang, Jennifer Ingram, and Dimitri Phillips. The information

and views set out in this paper are the responsibility of the authors and do not necessarily reflect the work or views of the

China Guiding Cases Project.

1 《北京阳光一佰生物技术开发有限公司、习文有等生产、销售有毒、有害食品案》 (Beijing Sunshine100

Biotechnology Development Co., Ltd., XI Wenyou, et al., A Case of Producing and Selling Toxic and Harmful Food),

Stanford Law School China Guiding Cases Project, English Guiding Case (EGC70), Jan. 30, 2017 Edition, http://

cgc.law.stanford.edu/guiding-cases/guiding-case-70.

2 《中华人民共和国食品安全法》 (Food Safety Law of the People’s Republic of China), passed and issued on Feb.

28, 2009, effective as of June 1, 2009, amended on Apr. 24, 2015, effective as of Oct. 1, 2015, http://www.npc.gov.cn/npc/

zfjc/zfjcelys/2015-04/25/content_1992458.htm.

3 《中华人民共和国中医药法》 (Law of the People’s Republic of China on Chinese Medicine), passed and issued

on Dec. 25, 2016, effective as of July 1, 2017, http://www.npc.gov.cn/npc/xinwen/syxw/2016-12/25/content_2006116.htm.

4 《中华人民共和国刑法》 (Criminal Law of the People’s Republic of China), passed on July 1, 1979, issued on

July 6, 1979, effective as of Jan. 1, 1980, amended nine times, most recently on Aug. 29, 2015, effective as of Nov. 1, 2015,

http://www.chnlawyer.net/law/subs/xingfa.html.

5 The “food” involved in Guiding Case No. 70 was “Sunshine100 Shanqishen Capsules”, which was specifically

identified as “health food”.

6 The first-instance judgment is 《北京阳光一佰生物技术开发有限公司与尹立新、王海龙等生产、销售有毒、有害食品罪一审刑事判决书》 (Beijing Sunshine100 Biotechnology Development Co., Ltd., YIN Lixin, WANG Hailong,

et al., The First-Instance Criminal Judgment of [a Case Involving] the Crime of Producing and Selling Toxic and Harmful

Food) （2013）扬广刑初字第0330号刑事判决 ((2013) Yang Guang Xing Chu Zi No. 0330 Criminal Judgment),

rendered by the Guangling District People’s Court of Yangzhou Municipality, Jiangsu Province, on Jan. 10, 2014, full text

available on the Stanford Law School China Guiding Cases Project’s website, at http://cgc.law.stanford.edu/judgments/

jiangsu-2013-yang-guang-xing-chu-zi-0330-criminal-judgment. The second-instance ruling (i.e., the (2014) Yang Xing Er

Zhong Zi No. 0032 Criminal Ruling), which upheld the first-instance judgment, was rendered by the Intermediate People’s

Court of Yangzhou Municipality, Jiangsu Province, on June 13, 2014. This ruling has not been found and may have been

excluded from publication.

7 《最高人民法院、最高人民检察院关于办理危害食品安全刑事案件适用法律若干问题的解释》 (Interpretation of the Supreme People’s Court and the Supreme People’s Procuratorate on Several Issues Concerning the

Application of Law in the Handling of Criminal Cases on Endangering Food Safety), passed by the Adjudication

Committee of the Supreme People’s Court and the Procuratorial Committee of the Supreme People’s Procuratorate on

Apr. 28, 2013, issued on May 2, 2013, effective as of May 4, 2013, http://www.spp.gov.cn/zdgz/201305/

t20130506_58566.shtml.

8 《食品中可能违法添加的非食用物质名单 （第1-5批汇总）》 (List of Non-Edible Substances That May Have

Been Unlawfully Added to Food (Compilation of Batch Nos. 1–5)), issued by the Special Remediation Leading Group for

the Nationwide Crackdown on the Unlawful Addition of Non-Edible Substances and Abuse of Food Additives on Apr. 19,

2011, http://www.moh.gov.cn/sps/s7892/201406/38e5c8a53615486888d93ed05ac9731a.shtml.

9 《保健食品中可能非法添加的物质名单（第一批）》(List of Substances That May Have Been Illegally Added to

Health Food (Batch No. 1)), issued by the China Food and Drug Administration on Mar. 16, 2012, http://www.sda.gov.cn/

WS01/CL0847/69914.html.

6

10 See, e.g., Yu‐chih Chen, Chinese Values, Health and Nursing, 36 Journal of Advanced Nursing 270 (2001);

Stella Ling, Janet King, & Virginia Leung, Diet, Growth and Cultural Food Habits in Chinese-American Infants, 3 The

American journal of Chinese medicine 125 (1975).

11 《国家卫生计生委办公厅关于征求á按照传统既是食品又是中药材物质目录管理办法ñ（征求意见稿）意见的函》 (Letter of the Office of the National Health and Family Planning Commission on Seeking Comments on the

Administrative Measures for the Catalogue of Substances Which Are Traditionally Both Food and Chinese Medicinal

Materials (Draft for Comment)), issued on Oct. 28, 2014, http://www.nhfpc.gov.cn/sps/

s3585/201411/67ac54fb05ed46929adc63f2db31d4bf.shtml.

12 《禁止食品加药卫生管理办法》(Administrative Measures on Health for Prohibiting Medicine from Being Added

into Food), passed by the then-Ministry of Health on Oct. 22, 1987, issued on and effective as of Oct. 22, 1987, http://

www.moh.gov.cn/mohzcfgs/pgz/200905/40514.shtml.

13 国家食品药品监督管理局 (China Food and Drug Administration),《既是食品又是药品的品种名单》(List of

Varieties That Are Both Food and Medicine), http://www.sfda.gov.cn/WS01/CL1159.

14 国家药典委员会（主编） (Chinese Pharmacopeia Commission (Ed.)), 《中华人民共和国药典：2015年版》）》（中国医药科技出版社2015年版） (The Pharmacopeia of the People’s Republic of China (China Medical

Science Press, 2015)), http://wp.chp.org.cn/en/content.html?id=ff8080814fd5ba0a014fd6f0402c0143.

15 《新食品原料安全性审查管理办法》 (Administrative Measures for the Safety Review of New Food Raw

Materials), passed by the then-Ministry of Health on Feb. 5, 2013, issued on May 31, 2013, effective as of Oct. 1, 2013,

http://www.moh.gov.cn/fzs/s3577/201307/34de96581cfc4751be3bc83870360472.shtml.

16 上饶市食品药品监督管理局 (Food and Drug Administration of Shangrao Municipality),《新食品原料名单和药食同源食品总览（更新日期：2016年10月）》(A List of New Food Raw Materials and an Overview of Foods and

Medicines whose Sources are the Same (Updated in October 2016)), http://www.srfda.gov.cn/e/upload/s1/fck/

file/2017/02/06/0908290781.pdf.

17 See, e.g., Geoff Colvin, Inside China’s $43 Billion Bid for Food Security, Fortune, Apr. 21, 2017, http://

fortune.com/2017/04/21/chemchina-syngenta-acquisition-deal; USDA Food Agricultural Service, People’s Republic

of China: Food Processing Ingredients Annual (GAIN, 2017), https://gain.fas.usda.gov/Recent%20GAIN%

20Publications/Food%20Processing%20Ingredients_Beijing%20ATO_China%20-%20Peoples%20Republic%20of_2-2-

2017.pdf.

18 See, e.g., World Bank statistics on “China Food Products exports and imports By Country and Region 2015”, at

http://wits.worldbank.org/CountryProfile/en/Country/CHN/Year/2015/TradeFlow/EXPIMP/Partner/All/Product/16-

24_FoodProd; Hong Kong Trade Development Council statistics on “China Customs Statistics”, at http://china-trade-

research.hktdc.com/business-news/article/Facts-and-Figures/China-Customs-Statistics/ff/

en/1/1X39VTVQ/1X09N9NM.htm.

19 United Nations Department of Economic and Social Affairs (Population Division), World Population

Prospects: The 2015 Revision, Key Findings and Advance Tables (United Nations, 2015), at 4, https://esa.un.org/unpd/

wpp/publications/files/key_findings_wpp_2015.pdf; World Bank statistics on “GNI per capita, Atlas method (current

US$)”, at http://data.worldbank.org/country/china.

20 《国务院关于印发中医药发展战略规划纲要（2016—2030年）的通知》 (Notice of the State Council on the

Issuance of the Strategic Plan for the Development of Chinese Medicine (2016—2030)), issued on Feb. 22, 2016, http://

www.gov.cn/zhengce/content/2016-02/26/content_5046678.htm.

21 For more information about the initiative, see the Belt and Road Series section of the website of the Stanford Law

School’s China Guiding Cases Project, at https://cgc.law.stanford.edu/belt-and-road.

7

The CGCP thanks the following sponsors for their support:

Alston & Bird

Broad & Bright

Center for East Asian Studies, Stanford University

China Fund, Freeman Spogli Institute for International Studies, Stanford University

Fu Tak Iam Foundation Limited

Copyright 2017 by Stanford University

Related Resources

《北京阳光一佰生物技术开发有限公司、习文有等生产、销售有毒、有害食品案》 (Beijing Sunshine100

Biotechnology Development Co., Ltd., XI Wenyou, et al., A Case of Producing and Selling Toxic and Harmful Food),

Stanford Law School China Guiding Cases Project, English Guiding Case (EGC70), Jan. 30, 2017 Edition, http://

cgc.law.stanford.edu/guiding-cases/guiding-case-70.

《北京阳光一佰生物技术开发有限公司与尹立新、王海龙等生产、销售有毒、有害食品罪一审刑事判决

书》 (Beijing Sunshine100 Biotechnology Development Co., Ltd., YIN Lixin, WANG Hailong, et al., The First-Instance

Criminal Judgment of [a Case Involving] the Crime of Producing and Selling Toxic and Harmful Food) （2013）扬广刑

初字第0330号刑事判决）((2013) Yang Guang Xing Chu Zi No. 0330 Criminal Judgment), rendered by the Guangling

District People’s Court of Yangzhou Municipality, Jiangsu Province, on Jan. 10, 2014, full text available on the Stanford

Law School China Guiding Cases Project’s website, at http://cgc.law.stanford.edu/judgments/jiangsu-2013-yang-guang-

xing-chu-zi-0330-criminal-judgment.

《王召成等非法买卖、储存危险物质案》(WANG Zhaocheng et al., An Illegal Trading and Storage of

Hazardous Substances Case), Stanford Law School China Guiding Cases Project, English Guiding Case (EGC13),

Apr. 10, 2013 Edition, http://cgc.law.stanford.edu/guidingcases/guiding-case-13.

22 Data compiled by the CGCP with reference to its list of Belt and Road countries, at https://cgc.law.stanford.edu/belt-

and-road/b-and-r-countries, and to Alex Gray, The World’s 10 Biggest Economies in 2017, World Economic Forum, Mar. 9,

2017, https://www.weforuzm.org/agenda/2017/03/worlds-biggest-economies-in-2017.

23 See Pharmacopeia of the People Republic of China, supra note 14; “About ChP” on the website of the

Pharmacopeia, at http://wp.chp.org.cn/en/content.html?id=ff8080814fd5ba0a014fd6f0402c0143; 中国食品药品鉴定研究院中药民族药鉴定所(Chinese Medicines and National Medicines Identification Institute of the China Food and Drug

Identification Research Institute), 2015版《药典》中药材标准的变化情况 (Changes in the Standards for Chinese

Medicinal Materials as Stated in the 2015 Edition of the Pharmacopoeia), 《药智新闻》(Yaozhi News), https://

news.yaozh.com/archive/11532.html.

8