In the wake of public outcry following the recent discovery of a major counterfeit powdered milk operation involving Rance Pharma International Pharmaceutical JSC and Hacofood Group Nutrition Pharmaceutical JSC, which allegedly produced and sold nearly VNĐ500 billion in fake goods, Director of the Ministry of Industry and Trade (MoIT)’s Market Surveillance Agency Trần Hữu Linh speaks to Vietnam News Agency about managing the market.

Could you please tell us about the management and product licences that Rance Pharma and Hacofood Group have violated? Is their operation under the MoIT's management?

According to the Government's Decree 15/2018/NĐ-CP dated February 2, 2018 detailing the implementation of a number of articles of the Law on Food Safety, the authority of State management over dairy products is clearly defined for each product group and specialised agency.

The MoIT is therefore only responsible for managing regular processed dairy products.

Special processed dairy products that are supplemented with micronutrients, functional foods or pharmaceuticals with special nutritional ingredients, are currently managed by the Ministry of Health.

In addition, the MoIT does not have the authority to grant business registration certificates to enterprises. The establishment and registration of business operations are carried out by the provincial and municipal Departments of Planning and Investment in accordance with the provisions of the Law on Enterprises.

Therefore, the MoIT does not directly license and manage Rance Pharma or Hacofood Group products. According to current regulations, the MoIT can only conduct inspections of the companies when the ministry detects signs of violations within the scope of its assigned functions and tasks.

How has the MoIT’s Market Surveillance Agency inspected and controlled the production and supply of dairy products to the market in the past four years? What were the inspection results?

In the past four years, the MoIT has directed the market management authorities to monitor, supervise and coordinate with relevant agencies and departments in the inspection and control of the commodity market, including dairy products and functional foods.

However, Hacofood Group and Rance Pharma were enterprises that were not under the specialised management authority of the MoIT. Therefore, according to current law, the MoIT is not allowed to conduct specialised inspections, periodic inspections or post-inspections on the two companies' production and supply of milk products.

As mentioned above, under current laws the MoIT can only conduct inspections of the companies when the ministry detects signs of violations within the scope of its assigned tasks.

However, with its responsibility and role in State management, the MoIT has regularly directed market management authorities to conduct inspection and control of dairy products in recent years.

Specifically, from 2021 to 2024, market management agencies nationwide inspected and handled 783 violations involving a total of 58,187 boxes, 451 cartons and 20,394 bottles or cans, with fines totalling more than VNĐ2.2 billion.

What were the causes preventing State management agencies from unveiling serious violations earlier, including a large number of fake dairy and food products supplied to the market in many locations?

The fact that some companies had many product lines distributed widely in the market and violations that were not detected for a long time may stem from a number of reasons.

Specifically, the companies carried out full business procedures and held documents in accordance with current laws to cover up their violations. Meanwhile, violations can only be detected when products are tested. The products had not yet received any feedback from consumers revealing potential violations for authorities to be able to take samples for testing.

In addition, the firms did not sell their products through supermarket systems, official agents or controlled retail chains, but sold directly to consumers through specialised seminars, hospitals and clinics. They also hired famous people, including movie actors and models, to advertise and sell directly to consumers through social networks such as YouTube, Facebook and Zalo, causing difficulties for supervision and inspection agencies.

What solutions are needed to strengthen the management of milk and dairy products and foods circulating on the market to prevent and handle violations?

Due to the above-mentioned incident, the MoIT’s Market Surveillance Agency will closely direct Market Surveillance Sub-Departments in provinces and cities to strengthen inspection and supervision of the circulation and distribution of dairy products, especially at small retail channels, unofficial agents, e-commerce platforms and social networks, where there are many potential risks of counterfeit goods or goods of unknown origin or poor quality.

Aside from field inspections, the agency will continue to collect feedback from consumers and coordinate with the health sector in managing quality, standards and food safety, as well as the agriculture sector in managing raw milk and agricultural products, to establish effective solutions to prevent the circulation of fake milk and sub-standard milk on the market.

Through this process, the MoIT is conducting a comprehensive review and assessment of management of circulation for dairy products with a focus on identifying loopholes after the distribution stage to propose a streamlined inter-sectoral coordination mechanism. This will help enhance efficiency in inspecting and handling commercial fraud, false advertising and food safety violations.

The MoIT’s overarching goal is to protect the legitimate rights of consumers, ensure market stability and tighten control over products that directly affect public health. — BIZHUB/VNS