An article published on January 3, 2008 in Wall Street Journal reported that in the U.S. and Europe, a wave of recalls of Chinese-made goods over the second half of 2007 led to heavy news coverage and a coordinated effort by regulators and the toy industry to pull dangerous products off the shelves. In China, it's a different story. The nation has no comprehensive rules governing recalls and no system for tracking injuries from defective products. Together with a thriving trade in black-market products, that means some of the goods that have caused alarm in the West are still available to Chinese consumers.
"For low-value goods, such as many of the toys involved in recent recalls, a foreign toy company may have little incentive to monitor production on-site," said Soonhong Min, a professor of marketing and supply chain management at the University of Oklahoma's Price College of Business. "After a recall, the [factory that made the toy for the foreign company will] try its best to recover money by distributing the defective products in the local market. That is nothing new."
In August, China launched a four-month product-safety initiative, including new regulations dealing specifically with food and toy recalls. The government is currently considering comprehensive product-safety legislation that would include establishing a database for recalled products and a system for tracing products and their components through the supply chain.
"We want to make the recall of defective products more systematic and more institutionalized," said Liu Zhaobin, an official at China's top product-quality watchdog, the General Administration of Quality Supervision, Inspection and Quarantine, or Aqsiq. But he adds that "businesses need to take more social responsibility."
Companies like Mattel and Mega Brands hire third-party companies to destroy recalled goods, either at the factory or after they are collected. But "unless you're very diligent about destroying the toys, the toys could re-enter the market," said Frederick Felman, chief marketing officer for MarkMonitor.
Mattel depended on its Chinese distributor, Midway Trading Co., to inform over 1,000 subdistributors about the recalls. Mattel said it made other efforts to inform consumers about recalls, including sending out a statement, publishing recall information online and translating documents into Chinese.
Some sellers of Mattel toys said they received incomplete information about recalls.
Source: Spencer, Jane and Canaves, Sky and Casey, Nicholas, “Toys Recalled in the U.S. are Still for Sale in China,” Wall Street Journal, January 3, 2008.