Food safety violations at Shanghai Husi Food Co Ltd, a supplier to global brands including McDonald's Corp and Yum Brands Inc, were company-led and not the acts of individuals, the official Xinhua news agency said, citing the Shanghai food and drug watchdog.
McDonald's and KFC's parent Yum, along with a number of other global brands, have been pulled into a food safety scandal in China after it emerged that Shanghai Husi Food, a unit of U.S.-based OSI Group LLC, had supplied expired meat to clients.
"We discovered that some of the company's illegal behavior was not the behavior of individuals, but rather an organized arrangement by the company," said the Shanghai Municipal Food and Drug Administration's deputy head, Gu Zhenhua, according to a Xinhua report late on Tuesday.
OSI has said it was "appalled" and was investigating the matter after a TV report showed staff at its Shanghai facility using expired meat and picking up meat from the floor to add to the mix.
An official at OSI in China reached by telephone on Wednesday declined to comment.
In a separate statement, the Shanghai watchdog said it had sealed more than a thousand tonnes of suspected meat products from OSI in China, and a further 100 metric tons of products from a range of its clients.
The scandal has already spread to McDonald's operations in Japan, where a fifth of its Chicken McNuggets were sourced from Shanghai Husi Food, as well as dragging in coffee chain Starbucks, Burger King Worldwide Inc, Chinese fast food chain Dicos and a range of others.
McDonald's and Yum apologized to Chinese consumers on Monday, while a range of firms have said they will take any products sourced from Shanghai Husi Food off their shelves.