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China expands Burger King probe to other US chains

KFC and McDonald's also face spot-checks as diplomatic tensions rise

McDonald's outlets in China are also being investigated.   © Reuters

SHANGHAI/TOKYO -- Chinese authorities investigating allegations of expired food sold at Burger King have broadened their probe nationwide and are looking into other U.S. fast-food chains.

The investigations have been led by local regulators after complaints against Burger King were first aired July 16 on state-owned CCTV's "315 Night Show," an annual consumer affairs program. Following the show, Burger King China issued an apology and promised to investigate.

"Spot-checks were carried out at similar fast-food chains, including KFC and McDonald's," Jiangsu Province regulators said in a July 22 statement. CCTV fingered McDonald's in 2012 due to claims of unsanitary food handling, resulting in a barrage of public criticism that led to companywide retraining. Though the American icon was not the main focus of consumer ire this time, it is obvious that U.S. fast-food chains are under increased pressure.

The development comes against rising trade and political tensions between China and the U.S. that have hampered business activity. 

During the July 16 program, Burger King outlets in the city of Nanchang in Jiangxi Province were accused by consumers of serving expired or poor-quality food, prompting an inspection by authorities that night. Six outlets were ordered shut and 85 kg of food was confiscated, according to city officials.

Several regulators in different cities looked at records regarding food purchases and expired food at Burger King outlets but have not found any food safety irregularities.

Burger King China headquarters in Shanghai did not respond to requests for an interview. Three of the outlets were still shut when the Nikkei Asian Review called on Tuesday. Mall operators where the outlets are located said they had "no idea" when they would reopen.

Following criticism on a consumer affairs program broadcast by state-owned CCTV, Burger King China was forced to apologize for alleged health infractions. (Photo by CK Tan)

"Foreign companies running consumer businesses in China need to pay much more attention to criticism," said Shingo Ito, senior economist at the Tokyo-based Institute for International Economic Studies. "In addition to increasingly negative views of certain foreign countries such as the U.S. and Australia, Chinese consumers are much more interested in food safety and health in conjunction with the spread of the coronavirus."

A purchasing manager at a five-star hotel in Shenzhen said authorities take complaints by the public seriously and set up a consumer affairs department on food safety two years ago, reflecting rising awareness of consumer rights. "From time to time we receive spot-checks," the manager said.

"The investigations will keep food operators on their toes," said a retiree who was dining at a Burger King in Shanghai. Scandals related to food safety surface occasionally, and with the high penetration of smartphones, consumers often take to social media to air their grievances.

"I'm also worried about rising political risks," said a person who runs several Japanese restaurants in China. In the past, political tensions with foreign countries have resulted in overseas companies being targeted by state-owned media. Western companies like Apple and Starbucks have also felt the heat from "315 Night Show." And it is likely to get worse as China's diplomatic ties with key countries begin to fray.

But Ito at the IIES mentioned that foreign companies are quite reluctant to give up on the Chinese market due to its size and opportunities.

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