Monday, February 28, 2011

Rodobo International (RDBO) Passed Inspection to Obtain New Production License

Rodobo has been orally informed that its operating subsidiary in PRC, Harbin Rodobo Dairy Co., Ltd ("Harbin Rodobo"), has passed its on-the-spot inspection performed by the Heilongjiang Bureau of Quality and Technical Supervision ("HBQTS") and will obtain the new production license for its infant formula powder products in March 2011.

On November 1, 2010, the General Administration of Quality Supervision, Inspection and Quarantine of the PRC ("AQSIQ") promulgated new rules which govern the licenses granted to producers of dairy products and infant formula powder (2010 version) ("the New Regulations"). These New Regulations require that such producers, even if they have obtained a production license previously, must re-apply for a production license prior to December 31, 2010 and if a producer is not able to obtain a new production license by March, 2011, such producer must stop its production of dairy products and infant formula powder.

An inspection team composed of experts in the dairy industry from the HBQTS, which is the provincial authority in charge of standardization, metrology, quality and special equipment safety supervision, visited our production facilities in Harbin, PRC on February 23, 2011. These experts conducted inspections of all our production facilities and quality monitoring instruments, quality control procedures and management team, which covers around 100 testing points. The HBQTS experts concluded that we satisfied all the criteria required by the New Regulations.

"We are very pleased that we passed the examination run by the HBQTS, which validates our superior quality control standards. Rodobo is among the first batch of infant formula milk powder producers that has completed the mandatory re-certification process in China." stated Mr. Yanbin Wang, Chairman and Chief Executive Officer. "Although the increasing regulatory scrutiny on our industry may result in increased costs in the short term, we believe it will benefit the industry in the long run. We believe there may be some infant formula milk powder producers that fail to receive a new license from the AQSIQ and, as a result, these producers will be forced to stop production. We believe that this industry reshuffle will restore Chinese consumers' confidence on local brands and create growth opportunities. We will preserve the trust of the government and our customers in the future by continuing to provide Rodobo's high quality and nutritious milk powder products to our customers."


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