December 27, 2008 / 8:53 AM / 11 years ago

Chinese firms to compensate tainted milk victims

BEIJING (Reuters) - Chinese dairy firms that sold baby formula tainted with the industrial chemical melamine will pay compensation to the families of nearly 300,000 children who were killed or sickened as a result, state media reported.

A staff removes tainted milk products off shelves at a supermarket in Tianjin municipality in this September 18, 2008 file photo. Chinese dairy firms that sold baby formula tainted with the industrial chemical melamine will pay compensation to the families of nearly 300,000 children who were killed or sickened as a result, state media reported. REUTERS/Vincent Du

Twenty-two dairy producers will soon make one-off cash payments to the families, the Xinhua news agency cited the China Dairy Industry Association as saying on Saturday.

It did not disclose the size of the payments.

Sanlu Group, the company at the heart of the scandal that has since gone bankrupt, will be among the firms to make such payments, Xinhua said, without listing the others. Sanlu is partly owned by New Zealand’s Fonterra group.

However, Inner Mongolia Yili Industrial Group, Mengniu Dairy and Bright Dairy group are among those found earlier to have produced contaminated milk.

“The enterprises offered to shoulder the compensation liability. By doing so, they hope to earn understanding and forgiveness of the families of the sickened children,” Xinhua quoted the association as saying.

The companies will also create a fund to cover victims’ potential future medical bills resulting from their having consumed the contaminated milk, it said.

Chinese authorities have said that at least six children died and around 294,000 were made ill earlier this year after they drank formula containing melamine, which led to problems including kidney stones.

The scandal battered faith in Chinese-made products and led to recalls of Chinese-made diary products around the world.

Plans for compensating the victims have drawn criticism from some lawyers, who have complained that the plans were being drawn up behind closed doors without the victims’ input and that authorities were hindering their efforts to sue the companies.

Six people have recently gone on trial for their part in the scandal, accused of producing, selling or buying the chemical to put in milk, as a way of cheating nutrition tests.

Tian Wenhua, Sanlu’s former board chairwoman and general manager, will go on trial next Wednesday, according to state media.

Reporting by Jason Subler; Editing by Valerie Lee

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