A Blockchain-Based RegTech System for Product Safety Enforcement : A Case Study of Food Import in China

Food safety is highly regulated in China. Moving from food hygiene to food safety regulation, the central government in China has developed more stringent regulatory measures over the past two decades for both national food production and imported food products. The compulsory observance of this regulation presents a specific challenge for all overseas companies that wish to export food to China. Blockchain has proved to be a technology able to ease regulatory burdens, especially in the finance field. Besides, the Chinese government has a strategy to develop the use of blockchain as a technology for establishing e-government and providing more transparent and better-quality services to the public.
This chapter studies the use of blockchain as a regulatory technology to facilitate food product safety enforcement. The research focuses on food import regulations in China and studies the case of the business-to-business (B2B) food platform Foodgates that markets French food products to Chinese buyers. Foodgates manages all aspects of a transaction including regulatory compliance and transportation from producer warehouse to the final destination in China. In the process, Foodgates collects all pieces of information required by the Chinese authorities and stores them on a private blockchain. Even though the current adoption of blockchain by Chinese Customs authorities is limited, Foodgates’s information system enables a direct access to certified information for all stakeholders and therefore smoothens the path of food import into China.