March 15 is World Consumer Rights Day, established in 1983 by Consumers International. Its purpose is to expand the promotion of consumer rights protection and to safeguard consumers' rights and interests to the greatest extent possible on an international scale. Every year on March 15, China Central Television (CCTV) exposes typical cases of infringement of consumer rights that occurred over the past year. Over the past decade, the area with the most exposed cases on CCTV's March 15 Gala has been food safety. From the shocking melamine-tainted milk powder and plasticizer-contaminated bubble tea of earlier years to the recent "old坛 pickled vegetables" and Yuzhou vermicelli, irregularities in the food safety industry are not uncommon. As the saying goes, "Food is the paramount necessity of the people." The safety of food and food-related products is the most fundamental requirement of national life and a vital component of national public security. To effectively ensure that citizens can "eat with confidence," the state has established stringent obligations for food producers and operators through newly revised regulations such as the Food Safety Law and the Consumer Rights Protection Law, as well as related systems such as punitive damages. At the same time, with the improvement of residents' legal awareness, concepts of food safety such as "three-no products," "bulk food," and "tenfold compensation" have gradually become well-known to the public. To welcome the arrival of Consumer Rights Day on March 15 and to cultivate residents' good habits of seeking and using the law when encountering problems, this article summarizes the relevant provisions applicable when residents face food safety disputes.

I. When Is Compensation Required? -- Food Safety Standards

According to the relevant provisions of the Food Safety Law, if a producer produces food that does not meet food safety standards, or if an operator knowingly sells food that does not meet food safety standards, consumers may, in addition to claiming compensation for losses, demand from the producer or operator a punitive payment of ten times the purchase price or three times the amount of the losses. Therefore, food safety standards are the key to food safety disputes. Although the specific standards for food safety are numerous and complex, the prohibitive provisions enumerated in Article 34 of the Food Safety Law of the People's Republic of China may serve as a reference:

The production and operation of the following food, food additives, and food-related products are prohibited:

(1) Food produced using non-food raw materials, or food to which chemical substances other than food additives and other substances that may be harmful to human health have been added, or food produced using recycled food as raw materials;

(2) Food, food additives, and food-related products in which the levels of pathogenic microorganisms, pesticide residues, veterinary drug residues, biotoxins, heavy metals, and other contaminants, as well as other substances harmful to human health, exceed the limits set by food safety standards;

(3) Food and food additives produced using food raw materials or food additives that have exceeded their shelf life;

(4) Food in which food additives are used beyond the permitted scope or limit;

(5) Staple and supplementary foods exclusively for infants and other specific populations whose nutritional content does not meet food safety standards;

(6) Foods and food additives that are rotten, deteriorated, rancid, moldy, infested with insects, filthy, contaminated with foreign substances, adulterated, or abnormal in sensory properties;

(7) Meat of poultry, livestock, game animals, or aquatic animals that is diseased, poisoned, or of unknown cause of death, and products thereof;

(8) Meat that has not undergone quarantine inspection as required or has failed such inspection, or meat products that have not undergone inspection or have failed inspection;

(9) Foods and food additives contaminated by packaging materials, containers, means of transport, etc.;

(10) Foods and food additives with falsely labeled production dates or shelf life, or which have exceeded their shelf life;

(11) Prepackaged foods and food additives without labels;

(12) Foods whose production and sale are expressly prohibited by the State for special needs such as disease prevention;

(13) Other foods, food additives, and food-related products that do not comply with laws, regulations, or food safety standards.

According to the provisions of the aforementioned Food Safety Law, in addition to the most basic requirements such as hygiene and shelf life, food safety standards also include relevant content concerning food additives, food packaging, and special foods. Among these, the specific safety regulations for various types of food are numerous and complex, and conflicts and overlaps exist among different standards. Therefore, in practice, there may be disagreements regarding the determination of "food that does not comply with food safety standards." However, there is generally no dispute over easily ascertainable standards such as food exceeding its shelf life or packaging labels lacking necessary information. If consumers seek to protect their rights on this basis, the merchant is typically required to bear corresponding compensation liability.

Illustrative Case: (2021) Hu 0120 Min Chu No. 13930

In April 2021, Mr. Deng purchased eight Fuding White Tea Compressed Shou Mei tea cakes at a hotel in Shanghai, paying a total of RMB 6,224. The outer packaging of the tea cakes bore information such as the product name and type, but lacked the name, address, and contact information of the producer, as well as the production license number. Mr. Deng argued that the Shanghai hotel's sale of tea cakes failing to indicate necessary information such as the producer's name and address was illegal, and that the hotel should bear tenfold punitive damages liability to him. The Shanghai hotel countered that the tea cakes were agricultural products produced and sold directly by a village farmers' tea garden, rather than prepackaged products, and therefore did not require the relevant information to be indicated on the packaging. The parties failed to reach an agreement through negotiation, and the case was subsequently brought to court.

The court held that: Based on the definitions of primary agricultural product processing and prepackaged foods, the tea cakes in question were compressed Shou Mei, which falls under the category of compressed tea. Their production requires specific processes such as sorting, blending, steam-compression shaping, and drying, which are distinctly different from simple primary tea processing. Furthermore, the product in question had already been packaged and bore a net content declaration. Therefore, the tea cakes in question should be classified as prepackaged foods rather than agricultural products. According to the provisions of the Food Safety Law of the People's Republic of China, the packaging label of a prepackaged food must indicate information such as the producer's name, address, contact information, and production license number, and must not contain any false content. Upon examination of the product in question, it was found that its label lacked the producer's name, address, and contact information, as well as the production license number. Additionally, the implementation standard indicated on the packaging was dated July 2015, while the declared production date was September 2012, presenting an obvious contradiction. Accordingly, this court legally determines that the product in question does not comply with China's food safety standards. As the seller of the product that fails to meet food safety standards, the Shanghai hotel is therefore subject to Mr. Deng's claim for compensation at ten times the purchase price.

Legal Analysis by Counsel:

Prepackaged food refers to food that is pre-quantitatively packaged or pre-made in packaging materials or containers, including food that is pre-quantitatively packaged and pre-quantitatively made in packaging materials or containers and bears a uniform indication of mass or volume within a certain range of quantity limits. According to the above definition, except for bulk food, freshly prepared and sold food, and edible agricultural products, most food sold on the market falls under the category of prepackaged food. For such products, the packaging shall bear a label indicating information such as the date of manufacture, shelf life, and the name of the producer. If such necessary information is lacking, the product is deemed "non-compliant with food safety standards." When consumers purchase such products, regardless of whether they have actually used them or suffered actual personal injury, they are entitled to claim compensation from the producer or operator.

II. How Much Compensation Is Payable? -- Punitive Damages for Food Safety

When it comes to compensation in the field of food safety, one may think of well-known phrases such as "refund plus triple damages" or "refund plus ten times damages." Among these, "refund plus triple damages" refers to the provisions of the Law of the People's Republic of China on the Protection of Consumer Rights and Interests, while "refund plus ten times damages" refers to the provisions of the Food Safety Law of the People's Republic of China. Since food is a special type of commodity and the compensation standard under the Food Safety Law is higher than that under the Law on the Protection of Consumer Rights and Interests, "refund plus ten times damages" is generally applied in food disputes rather than "refund plus triple damages."

Legal Reference: Article 148, Paragraph 2 of the Food Safety Law of the People's Republic of China stipulates: Where a producer produces food that does not meet food safety standards, or an operator knowingly operates food that does not meet food safety standards, the consumer may, in addition to claiming compensation for losses, demand from the producer or operator a payment of ten times the price or three times the amount of the losses as compensation for damages; if the amount of additional compensation is less than one thousand yuan, it shall be one thousand yuan.

Illustrative Case: Dispute over an online shopping contract between Zheng Mou and a certain children's food company (published in the People's Court Daily on December 9, 2020, as a typical case of civil disputes over food safety).

On October 20, 2015, Zheng Mou purchased a box of jelly from the online store of a certain children's food company. Later, while consuming the jelly, Zheng Mou discovered a foreign substance in one of the jellies (note: the jelly was unopened), which upon inspection was identified as a spider. This jelly was also produced by the said children's food company. After negotiations between the parties failed, Zheng Mou filed a lawsuit requesting that the children's food company refund the purchase price and pay compensation of 1,000 yuan.

The court held that the legitimate rights and interests of consumers are protected by law. During the consumption of jelly purchased by Zheng from the defendant's online store and manufactured by the defendant, a foreign object resembling a spider was discovered in one of the jelly products. Pursuant to the provisions of "GB19299-2015 National Food Safety Standard for Jelly," specifically Section 3.2 Sensory Requirements, which stipulates that no foreign objects visible to the naked eye under normal vision shall be present, the jelly in question is deemed a food product that does not conform to food safety standards. In accordance with the provisions of the Food Safety Law of the People's Republic of China, where a food product not conforming to food safety standards is produced, or where a food product known to not conform to food safety standards is operated, the consumer may, in addition to claiming compensation for losses, demand from the producer or operator a punitive payment of ten times the price or three times the losses; if the amount of additional compensation is less than one thousand yuan, it shall be one thousand yuan. However, this does not apply to defects in food labels or instructions that do not affect food safety and do not mislead consumers. In this case, although Zheng did not consume the jelly containing the foreign object and did not submit evidence proving that the food caused him any personal injury, the punitive compensation provided for in the Food Safety Law is not premised on the consumer having suffered personal injury or damage to their rights and interests. Therefore, Zheng's claim for a refund of the purchase price and payment of 1,000 yuan in compensation is legally grounded and should be upheld. Consequently, the court ordered a certain children's food company to refund the purchase price to Zheng and pay compensation of 1,000 yuan.

Lawyer's Interpretation:

Where a food product does not conform to food safety standards, and the consumer claims that the producer or operator shall bear punitive compensation liability pursuant to Article 148, Paragraph 2 of the Food Safety Law, the people's court shall not support the defense of the producer or operator that no personal injury was caused to the consumer. The consumer has the right to demand compensation from the producer or operator.

III. From Whom to Claim?--Subject of Punitive Compensation

Pursuant to Article 148, Paragraph 2 of the Food Safety Law of the People's Republic of China, where a food product not conforming to food safety standards is produced, or where a food product known not to conform to food safety standards is operated, the consumer may, in addition to claiming compensation for losses, demand from the producer or operator a punitive payment of ten times the price or three times the losses. Therefore, the principle of no-fault liability applies to the producer of food for punitive compensation, while the principle of fault liability applies to the operator. In other words, for a food producer, as long as it produces food that does not conform to safety standards, it shall bear the legal liability for punitive compensation regardless of whether it is at fault. For a food operator, punitive compensation is only required when it subjectively has knowledge that the food it operates does not conform to food safety standards. In judicial practice, proving that the operator has such "knowledge" is often a difficult point in food safety disputes.

Case Reference for Legal Interpretation: (2016) Yu 0107 Min Chu Zi No. 10155

In 2015, Liu purchased 20 bags of a certain brand of pistachios from a department store. According to the product packaging label, its fat content was19.7 grams/100 grams. Subsequently, Liu sent the 20 bags to a testing agency for inspection, and the results showed that the fat content per100 grams of this batch of products was over 40 grams. Based on this, Liu argued that the pre-packaged food sold by the department store failed to correctly indicate its ingredients, violating food safety standards, and requested that the department store pay ten times the purchase price as compensation. The department store, however, contended that it had no way of knowing that the products provided by the manufacturer did not match the packaging label, and thus did not fall under the category of "knowingly selling food that does not meet food safety standards." As the parties failed to reach a settlement, the case was brought to court.

The court held that Liu purchased the pistachios from the department store, and a sales contract relationship was legally formed between the parties. Given that the fat content of the department store's products was found to exceed the standard upon testing, violating the provisions of the National Food Safety Standard "General Rules for Nutrition Labeling of Prepackaged Foods," the products constituted food that does not meet food safety standards. However, the aforementioned facts clearly did not fall within the circumstances that the department store knew or should have known. Therefore, the department store did not knowingly sell the products in question that failed to meet food safety standards, and thus did not satisfy the statutory requirements for a seller to bear punitive damages of ten times the purchase price.

Legal Analysis by Counsel:

Business operators bear a duty to inspect the food they sell. In judicial practice, if a business operator fails to fulfill the corresponding obligation to inspect incoming goods or engages in active conduct to sell food that does not meet food safety standards, it is often deemed to have acted "knowingly." Such acts of commission or omission typically include: selling food that has passed the expiration date indicated on the label; failing to provide a lawful source of purchase for the food sold; purchasing goods at a clearly unreasonably low price without justifiable cause; failing to lawfully perform the duty of inspecting incoming goods; falsely labeling or altering the production date or batch number of food; or transferring, concealing, or unlawfully destroying purchase and sales records of food, or intentionally providing false information.

Therefore, in disputes concerning food that does not meet food safety standards, business operators are not always required to pay consumers punitive damages of ten times the purchase price. Consumers should also reasonably choose the target of their claims based on the facts of the case and the provisions of the law when enforcing their rights.