It sounds like the beginning of a joke, doesn't it? When a regulatory body gets rigor mortis, the Official Opposition comes to life. Ba-doom-ching! But seriously folks, what does happen when a regulatory agency fails, even in terms of its own definition? According to the Government of Canada, a regulatory body is "an organization that sets the standards and practices of a regulated occupation. They are responsible for the issuing of license."

Simply through the nature of the regulatory body, administrative law comes into play. Administrative law is the body of law meant to govern government agencies in the areas of making rules, adjudication and enforcement. These agencies act according to a specific controlling agenda. In addition to qualifying members and issuing licenses, some agencies monitor the activities of their membership and react to complaints, others are actively engaged in recurrent audits and investigations.

As regulated professions have evolved into ever more complicated specialties, regulatory bodies have had to adjust both in size and scope. Offshoots of regulatory bodies have borne their own bodies, and those have had their own, etc. One of the mainstays of government is budget cuts, and one of the places to cut costs is in contracting out. Thus we have the emergence of independent regulatory agencies, which are still bound to abide by the agenda laid out by their parent agency. In addition, they are under contract to operate in the same manner as if they were a part of the public sector (despite being situated in the private sector).

Herein lies the root of the problem with regulatory bodies. Let's assume a governmental ministry employs an association management system to assist in tracking, qualifying, and monitoring its members. The system provides a venue for members and overseers to correspond, peruse the membership and report complaints. In turn, the regulatory body uses the system to respond to the activities and communication of the membership. However, when there is a break in the chain of workflow management systems, major oversights occur.

Case in point: the Chinese Melamine Milk Scandal of 2008. In May of 2007 the media reported evidence of melamine being added to animal feed, as discovered by international food inspectors. In August of 2007, the State Council Information Office responded with a white paper entitled "Conditions of Food Quality and Safety in China". The report meticulously outlined the legal and regulatory methods of safety being applied to the manufacture of food in China, but fell short of recommending tighter regulations and testing. The white paper made it clear, in black and white, that adding melamine to food products was against Chinese law. Additionally, since the report was simply a statement of current regulations with no further changes, the use of melamine in food products was being done illegally in the past and continued each day. The regulatory body was not functioning beyond its regulations.

The food industry in China is highly fragmented, competition is extremely fierce, often resulting in competing companies selling very alike products in an effort to outdo each other. Behind the vehement competitive strategies there is a major shortfall in education, not only in business operations but also in the fundamentals of food manufacturing (nutrition, chemistry, biology, agribusiness etc). Furthermore, manufacturers are forced to choose between a high quality product that may not sell as readily, and a low quality/low price product that will sell profusely. The choice seems obvious, except when regulatory standards are disregarded and inspections do not occur with any sort of frequency or impartiality.

The above circumstances set the stage for a long history of the dairy industry using the very common practice of adding melamine to diluted milk, all in an effort to increase the protein levels while creating more product to sell. In 2008, two competing companies with a long history of battling it out on the grocery store shelves took their fight to the next level. Perhaps in answer to each other or perhaps as a coincidence, both milk suppliers added more melamine than usual to their milk. The result meant there was more melamine than actual milk, creating toxic milk and baby formula. In China alone eleven infants died, 50,000 were hospitalized, and 300,000 fell ill. By January 2009 two plant managers were sentenced to death, four executives were charged with manufacturing and selling fake products and one CEO was sentenced to life in prison.

Putting aside all the cultural and political assumptions so easy to make here, let us consider the state of the regulatory body. The regulations for the safe manufacture of food were in place, as were the inspections. Yet the manipulation of ingredients purely for the reduction of cost and increase of profitability reigned supreme. Once again, the regulatory agency was not functioning, except in theory.

The system of checks and regulations in Canada is not perfect, however it does contain enough to prevent anything like the Melamine Milk Scandal from happening. Agencies designed to regulate and monitor actually carry out their responsibilities, and efficient work flow management systems ensure all entities are in communication at every level. Unfortunately for China, the political environment needed for such a system is simply not possible yet. But the awful goings-on of 2008 do serve to remind us why functional bureaucracy is so important.