Exhibit 14

                              AMERICAN DAIRY, INC.


                       CODE OF BUSINESS CONDUCT AND ETHICS

                                       FOR

                        DIRECTORS, OFFICERS AND EMPLOYEES

                                       OF

                              AMERICAN DAIRY, INC.

                          AND ITS AFFILIATED COMPANIES






               The people of American Dairy, Inc.

                     o hold integrity as our paramount value,

                     o commit to excellence, and

                     o respect each other and the people with whom we deal.


               These personal values we hold and the customer value we
               deliver are essential to create shareholder value.


<PAGE>


                              AMERICAN DAIRY, INC.

                       CODE OF BUSINESS CONDUCT AND ETHICS


This code of business conduct and ethics applies to you if you are a director,
officer, or employee of American Dairy, Inc. or any of its majority-owned
subsidiaries. In this code, references to "the company" and "companies" mean
American Dairy, Inc. and its subsidiaries; and references to "your company" mean
any American Dairy, Inc. company of which you are a director, officer, or
employee. This code consists of standards that set forth basic rules, and
guidelines that further explain what is expected of you. You must read, become
familiar with, and comply with these standards and guidelines.

                                    STANDARDS

1.     You must obey laws and regulations.

       As a director, officer, or employee, you must comply with the laws,
       regulations, and rules that apply to the business of the companies. This
       includes federal, state, local, and foreign laws, ordinances, regulatory
       orders, agency rules, judicial decisions, and other legal requirements,
       including but not limited to the laws of The People's Republic of China
       ("China"). You must not engage in insider trading by buying or selling
       securities of any issuer if you have material, nonpublic information
       about the issuer, or by tipping that information to others.

2.     You must not improperly discriminate against others.

       As a director, officer, or employee, you must not make decisions or take
       actions that discriminate against anyone on any unlawful basis, including
       gender or gender identity, race, religion, color, national origin,
       ancestry, sexual orientation, age, medical condition, physical or mental
       disability, HIV, SARS, or AIDS condition, marital status, veteran status,
       or family leave status, except as provided by law.

3.     You must avoid conflicts of interest.

       You must not allow yourself to be in a position in which your personal
       interests and the interests of your company are in conflict, or which
       might interfere with your ability to perform your job as well as
       possible. If you have a conflict of interest, you must report it as
       explained in the accompanying guidelines.

4.     You must not take for yourself opportunities that belong to the
       companies.

       You must not take for yourself business opportunities that you become
       aware of because of your position with your company. You must not use
       your position with your company for your personal gain or advantage. You
       must not compete with the companies.
<PAGE>

5.     You must properly use and protect assets of the companies.

       You must not use any company property or services for personal gain or
       remove or dispose of materials, supplies, or equipment of the companies
       without proper authorization. Within your areas of responsibility, you
       must safeguard company assets so they are used efficiently and are not
       wasted, lost, or stolen.

6.     You must not offer, give, or accept gratuities, kickbacks, bribes, or
       other improper payments.

       A prohibited gratuity is any entertainment, favor, gift, or other thing
       of material value that is given or accepted to obtain preferential
       treatment. Kickbacks and bribes are payments intended to influence the
       recipient to act improperly or unlawfully. You must comply with the
       federal U.S. Foreign Corrupt Practices Act, which prohibits corrupt
       payments and gifts in foreign business transactions, and other similar
       laws in China.

7.     You must not improperly use or disclose confidential information.

       Unless disclosure is authorized by management or legally required, you
       must maintain the confidentiality of information about the companies and
       their businesses. You must not improperly use company information for
       your personal gain or advantage.

8.     You must do your part to ensure that public disclosures are full, fair,
       accurate, timely, and understandable.

       If you have responsibilities to prepare or contribute to reports that
       will be filed with the Securities and Exchange Commission or other
       governmental bodies, you must strive to make sure that those reports
       comply with the letter and spirit of applicable requirements. If you
       prepare or contribute to press releases or other information provided to
       the public, you must strive to make sure that information is accurate,
       understandable, and not misleading.

9.     You must do your part to ensure that information in books, records,
       accounts, and other documents is accurate and complete.

       If you have responsibilities to initiate or modify entries in company
       accounting records, you must perform those responsibilities in accordance
       with applicable accounting policies and procedures. You must not
       knowingly provide inaccurate, incomplete, or misleading information to be
       included in company records or documents.
<PAGE>

10.    You must seek to safeguard the safety of others and protect the
       environment.

       You must be familiar with the safety rules and procedures that apply to
       your job responsibilities and perform your duties in a manner that does
       not endanger your co-workers or the public. You must be familiar with and
       follow your company's policies and procedures for protecting the
       environment.

11.    You must not use corporate funds or resources to support any
       political party or candidate, or engage in any lobbying, without proper
       senior management authorization.

       Corporate political activities are subject to federal, state, and local
       limits and reporting requirements. To ensure that the companies comply
       with applicable laws, all corporate campaign contributions, lobbying, and
       other political activities must be approved in advance by senior
       officers.

12.    You must be fit to perform your responsibilities while on the job.

       You must not be under the influence of alcohol or illegal drugs while you
       are at work. You must not possess or use illegal drugs at any time.

13.    You must deal fairly with others.

       You must not take unfair advantage of customers, suppliers, contractors,
       regulators, competitors, employees, or investors of the companies through
       manipulation, concealment, abuse of privileged or confidential
       information, misrepresentation of material facts, or any other practice
       of unfair dealing.

14.    You must report violations of this code of ethics and cooperate with
       duly authorized investigations.

       Reports may be made to your supervisor or manager or, if you prefer, to
       the Business Conduct and Ethics Hotline. Reports to the Hotline may be
       made anonymously and without fear of reprisal. The Business Conduct and
       Ethics Officer is Kirk G. Downing and the Hotline telephone number is
       (323) 935.3517.
<PAGE>

                                   GUIDELINES

The following guidelines are an integral part of the American Dairy, Inc. code
of business conduct and ethics. They are intended to help you understand what is
expected of you as a director, officer, or employee of American Dairy, Inc. or
any of its majority-owned subsidiaries. The guidelines set forth specific
requirements and procedures pertaining to the standards of the code. Each
guideline corresponds to the standard with the same number. You must read,
become familiar with, and follow these guidelines.

1.     Compliance with Laws and Regulations.

       Numerous federal, state, local, and foreign laws and regulations apply to
       the businesses of the companies. Regulatory agencies with jurisdiction
       over aspects of the businesses include the U.S. Securities, among others.
       It is the policy of American Dairy, Inc. to comply with all laws,
       regulations, and other legal requirements that apply to its companies and
       businesses.

       Insider Trading.

       United States securities laws prohibit insider trading, which means
       trading in stock or other securities on inside information (non-public
       material information) or sharing inside information with others to help
       them in trading securities. Inside information includes any material
       information that an investor would consider significant, such as earnings
       forecasts, new contracts, legal or regulatory developments, or pending
       mergers, acquisitions, or asset sales. You must not buy or sell
       securities of any issuer, including American Dairy, Inc., if you have
       inside information about that issuer. You must not furnish inside
       information to others. If you are a director or executive officer, you
       may be subject to additional restrictions and reporting requirements.

       You are expected to become familiar with the legal requirements that
       apply to your job responsibilities. If you have questions about
       applicable laws and regulations, you should check first with your
       supervisor or manager. If necessary, you or your supervisor or manager
       should check with the general counsel or law department of your company
       for further direction.

2.     Equal Employment Opportunity and Fair Treatment.

       The laws of the United States and many other countries require equal
       opportunity and fair treatment in employment-related decisions and
       actions. American Dairy, Inc. believes that equal opportunity and
       diversity are important to its success. Therefore, American Dairy, Inc.
       prohibits employment discrimination on any unlawful basis, including
       gender or gender identity, race, religion, color, national origin,
       ancestry, sexual orientation, age, medical condition, physical or mental
       disability, HIV, SARS, or AIDS condition, marital status, veteran status,
       or family leave status, except as provided by law. This policy applies to
       decisions about hiring, promotion, termination, work assignments, and
       compensation.
<PAGE>

       American Dairy, Inc. also prohibits employment discrimination in other
       forms, such as participating in any form of harassment, including sexual
       harassment, or harassment based on any of the characteristics listed
       above. The companies prohibit sending or forwarding e-mails containing
       sexual material or material that is derogatory about any of the
       characteristics listed above, telling racial jokes, criticizing another
       person's religious beliefs, and so forth. You should treat your
       co-workers and associates with respect and dignity, and avoid any form of
       improper treatment.

       In addition, it is American Dairy, Inc.'s policy to support diversity and
       fair treatment in procurement and other aspects of its business. You
       should act in accordance with such company policies that apply to your
       job responsibilities.

3.     Conflicts of Interest.

       You must avoid or eliminate conflicts of interest between yourself and
       the American Dairy, Inc. companies. In general, a conflict of interest
       may exist whenever outside activities or personal interests interfere or
       appear to interfere with your ability to objectively perform your job or
       act in the best interests of your company.

       Examples of potential conflicts of interest include:

       o   Serving as a director, officer, or employee of any entity that has
           material business dealings with your company, such as by
           "moonlighting" for a company contractor or supplier.

       o   Having a material financial interest in any entity that has
           business dealings with your company, such as by investing in a
           business that sells products to your company.

       o   Directing company business to a member of your immediate family,
           such as by purchasing goods or services from a business owned or run
           by your spouse or child.

       o   Receiving any financial payment or other compensation from any
           third party for decisions you make in your role with your company,
           such as by receiving cash, stock, or gifts for causing your company
           to do business with a third party.

       o   Serving as a director or officer of an entity that is a competitor
           of the companies or that takes position or acts in ways that are
           contrary to the interests of the companies.
<PAGE>

       The preceding list is not comprehensive, and any situation in which you
       may have or appear to have divided loyalties could involve a conflict of
       interest. If you are a director of American Dairy, Inc., you also should
       be aware of provisions in your company's corporate governance guidelines
       about qualifications and independence of directors.

       If you are an employee and think you may have a conflict of interest, you
       must immediately either eliminate the conflict or report it to your
       supervisor or manager. Your supervisor or manager will then work with the
       compliance and ethics officer to obtain a management determination
       whether a material conflict exists. If a material conflict exists, it
       must be eliminated or waived by senior management of your company.

       If you are a director or elected officer (vice president or above) and
       have a potential conflict, you must report it to the board of directors
       of your company. You may handle this reporting responsibility by
       providing relevant information to your compliance and ethics officer and
       asking him or her to make the report to the board. Any waivers for
       directors or elected officers must be made by the board of directors or a
       board committee of the relevant company and may be required to be
       publicly disclosed. To avoid potential conflicts, if you are an elected
       officer you should obtain approval from the board of directors of your
       company before joining the board of directors of another for-profit
       entity.

4.     Corporate Opportunities.

       In the course of your duties, you may become aware of potential business
       opportunities. You must not use for your own benefit opportunities that
       rightfully belong to the companies, as illustrated below.

       Examples of improper taking of corporate business opportunities may
       include:

       o   Marketing products or services that the companies may have an
           interest in marketing, such as products or services that relate to
           the companies' businesses or that may be sold to the companies'
           business partners.

       o   Obtaining patents, trademarks, or copyrights on inventions or
           materials developed during the course of your employment.

       o   Purchasing property that the companies may have an interest in
           purchasing.

       o   Investing in businesses that the companies may have an interest in
           acquiring.

       In general, you must not seek to use your position with your company to
       obtain personal benefits outside your compensation from the companies.
       You also must not pursue business opportunities that might place you in a
       situation of competing with the companies.
<PAGE>

       If you have questions about whether it is appropriate for you to take
       advantage of a business opportunity, you should consult with your
       supervisor or manager or your company's compliance and ethics officer.

5.     Company Assets.

       You are responsible for safeguarding the funds, property, and other
       assets of the companies to prevent abuse, loss, theft, or unauthorized
       personal use. You must not authorize payments, sign contracts, issue
       purchase orders, or settle claims except in accordance with your
       company's bylaws, a duly adopted board resolution, or a valid delegation
       of signature authority from an officer of your company.

       Except for limited and incidental use, as permitted by your management,
       you must not use company telephones, computers, copiers, or fax machines
       for personal purposes. You also must not take company funds, equipment,
       supplies, or materials for yourself or others. You should not improperly
       obtain company funds by falsifying expense reports or timesheets. If you
       are a director, officer, or manager, you must not direct employees to
       provide personal services to you, other than incidental services that
       might be performed by an assistant or secretary.

6.     Gratuities and Other Improper Payments.

       Business decisions must be made objectively, solely on the basis of
       quality, service, price, and similar competitive factors. You must be
       certain that any business courtesy that you offer or receive does not
       influence, or appear to influence, business decisions that you or others
       must make. The companies prohibit you from offering, giving, or accepting
       gratuities, kickbacks, bribes, or other improper payments.

       For this purpose, a gratuity is defined as any entertainment, favor,
       gift, or other thing of material value that is given in return for, or in
       anticipation of obtaining, preferential treatment in business
       transactions. In most cases, occasional business courtesies that have a
       relatively small value to you will not be considered to be gratuities.
       Such acceptable courtesies may include business lunches, food items,
       tickets to entertainment or sporting events, or promotional items,
       provided that the same courtesies are made widely available to other
       parties in similar business relationships. Any business courtesy may be
       considered to be a gratuity if it has significant value.

       Some departments or divisions within the companies have more restrictive
       policies on gratuities. For example, if you are involved in procurement
       activities, your company or department may prohibit you from accepting
       any gift at all. You should check with your manager or supervisor for
       additional information.

       Offers of expense-paid business trips from suppliers and others should
       not be accepted unless your manager or officer determines that the trip
       has overriding business value to your company.
<PAGE>

       You must not accept or offer gifts of cash, securities, or other
       cash-equivalents. Such gifts may be considered to be kickbacks or bribes.
       You must not accept or offer gifts that are tied to entering into a
       specific business relationship or providing a volume of business
       activity. Those kinds of gifts are prohibited kickbacks.

       Governmental officials and employees are subject to laws and regulations
       that restrict the amount of gifts and business courtesies they may
       receive and that require public reporting. You must not offer or give any
       item to a governmental official or employee unless authorized by an
       appropriate senior officer or manager of your company.

       Foreign Corrupt Practices Act.

       The federal U.S. Foreign Corrupt Practices Act prohibits any person from
       offering, paying, promising, or authorizing any payment of any money or
       other thing of value to an officer or employee of a foreign government,
       or to a foreign political party or candidate, for the purpose of
       influencing any official act or decision, inducing the recipient to use
       his or her influence or violate duty, or securing any improper advantage
       to obtain or retain business. Each company that does business in non-U.S.
       foreign countries or with foreign parties should adopt detailed policies
       for compliance with the Foreign Corrupt Practices Act.

7.     Confidential Information.

       Much of the information you encounter as a director, officer, or employee
       is confidential to your company. In general, you should consider
       information to be confidential if it gives the holder an improper
       business advantage over others who do not have it, or if unauthorized
       disclosure or use would be detrimental to the companies. Examples of
       confidential information may include customer data, earnings forecasts,
       unreleased financial information, business plans, employee records,
       working drafts of legal or regulatory filings, and so forth. Confidential
       information also may include information from or about other parties,
       such as business partners, vendors, and contractors.

       You must not use or disclose confidential information except in the
       course of your job responsibilities and as authorized by management or
       the board of directors. You also must not use confidential company
       information for personal gain or advantage. You must take appropriate
       steps to safeguard confidential information.

       The companies have adopted policies and procedures for information
       management, retention of records and e-mails, information technology
       security, and related matters. You should become familiar with and follow
       your company's policies. You may refer to the company-specific
       information below to find out where you can find these policies.
<PAGE>

8.     Public Disclosures.

       American Dairy, Inc. and some of its subsidiaries are required to file
       periodic disclosure reports with the U.S. Securities and Exchange
       Commission. Other regulatory agencies and stock exchanges also may
       require reports and public disclosures by the companies. If you are asked
       to review or contribute to the information in these reports and
       disclosures, you must do everything you can to ensure that the
       information is complete, accurate, understandable, timely, and fairly
       representative of the companies' circumstances.

       If you are the principal executive officer, principal financial officer,
       principal accounting officer, or controller, or an officer or employee
       performing similar functions, you have special responsibilities to ensure
       that reports filed with the Securities and Exchange Commission comply
       with applicable securities laws and do not contain any untrue statement
       of a material fact or omit to state a material fact necessary to make the
       statements made, in light of the circumstances under which the statements
       were made, not misleading.

       Public disclosures also include press releases, media statements,
       marketing brochures, and other information that is made publicly
       available. If you prepare, review, or contribute to such materials, you
       must seek to make sure that the information contained in them is
       accurate, understandable, and not misleading.

9.     Books, Records, and Accounts.

       The integrity and reliability of company accounting records are critical
       to the corporate decision-making process and to the ability of each
       company to meet its legal and financial reporting obligations. Other
       corporate records also must be valid, accurate, and complete. As part of
       your job, you may have responsibility for providing input to, creating,
       or maintaining company books, records, and accounts, including such
       information as financial data, employee data, customer data, purchase
       orders, contracts, minutes, and so forth. You must do your part to ensure
       that such information is valid, accurate, and complete, and that
       established internal control procedures are followed.

       Improper accounting practices that must be avoided include:

       o   Misclassifying expenditures, such as charging operation and
           maintenance expenses to work orders, operating reserve, or other
           capital accounts.

       o   Charging expenses to the wrong work order or function in an attempt
           to hide budget overruns.

       o   Requesting suppliers, contractors and consultants to alter the
           normal flow of invoice documents or changing the internal processing
           of documents in an attempt to delay or accelerate payments or
           accruals to a different accounting period.
<PAGE>

       o   Circumventing established internal controls over financial
           reporting.

       o   Any other practice that results in books, records, and accounts not
           fairly and accurately representing the companies' operations and
           financial condition.


10.    Safety and the Environment.

       Your actions can have a significant effect on the safety of others and on
       the environment. You have a responsibility for your own safety and health
       and that of co-workers and the public. Protecting safety and health
       includes staying alert to existing worksite conditions, using proper
       safety equipment and techniques, following established safety procedures,
       and using the correct tools for each job. You must read and follow the
       safety manuals and other materials that apply to your job.

       The companies are subject to numerous laws and regulations designed to
       protect the environment. You must become familiar with and follow the
       environmental policies and rules that apply to your job. You also should
       support company efforts to protect the environment.

11.    Political Activities.

       The businesses of the companies are affected by numerous laws,
       regulations, administrative rules, and regulatory orders. It is
       appropriate for the companies to protect their interests by supporting
       political candidates and engaging in lobbying. However, those activities
       are governed by federal, state, province, county, and local laws and
       regulations limiting expenditures and requiring recordkeeping and public
       disclosure. Therefore, corporate contributions to political parties or
       candidates, lobbying of legislators or public officials, and other
       political activities on behalf of your company must be approved in
       advance by the designated responsible officer or manager. This includes
       contributions in kind, such as using company phones or photocopiers or
       working on paid company time in supporting a candidate. You must comply
       with policies of your company about obtaining approval, keeping records,
       and reporting your activities. You must not engage in any unauthorized
       political or lobbying activities using company resources or on company
       time.

12.    Fitness for Duty.

       For the safety of others, and to perform your duties effectively, you
       must be free from the influence of alcohol or illegal drugs while on the
       job. You should not consume alcoholic beverages during your working hours
       or shortly before coming to work. In some circumstances, your company may
       allow you to consume alcoholic drinks in reasonable amounts during
       certain events, such as receptions, if that is customary in the
       prevailing culture. You must not possess or use illegal drugs or misuse
       controlled substances at any time. For safety reasons relating to certain
       jobs, your company may have more specific policies regarding possession
       or use of specified substances, including testing requirements. In
       general, you should avoid any activities or substances that significantly
       impair your ability to do your job as well as expected.
<PAGE>

13.    Fair Dealing.

       No code of ethics can cover every possible situation. As a guiding
       principle, you should seek to respect and deal fairly with others,
       including customers, suppliers, contractors, regulators, investors,
       co-workers, and even competitors. You must not take unfair advantage of
       others through manipulation, concealment, abuse of privileged
       information, misrepresentation of material facts, or any other practice
       of unfair dealing.

14.    Reports and Investigations.

       From time to time, you may observe or hear that others within the
       companies are violating this code of business conduct and ethics. For the
       good of the companies and in fairness to those who are complying with
       this code, you are expected to report violations. You may make the report
       to your supervisor or manager, the general counsel or compliance and
       ethics officer of your company, or the general auditor. Alternatively,
       you may make the report through the Business Conduct and Ethics Hotline.
       The Hotline is staffed by an independent provider; and management assures
       you that you can make reports to the Hotline anonymously, confidentially,
       and without any retaliation against you for making a report in good
       faith. Using the Business Conduct and Ethics Hotline, you also may make
       reports to the American Dairy, Inc. audit committee about accounting,
       internal control, or auditing matters or concerns about questionable
       accounting or auditing matters.

       If you are an attorney for one or more of the companies, you may have
       specific reporting responsibilities under rules of the Securities and
       Exchange Commission.

       From time to time, you also may be asked to provide information or answer
       questions as part of an investigation or audit of violations of this code
       or other matters. You are expected to cooperate fully with duly
       authorized corporate investigations and to be forthright, candid,
       truthful, and complete in your responses to those who been authorized by
       management to conduct an investigation.

       Reports of violations of this code will be investigated. Reports made
       through the Business Conduct and Ethics Hotline generally will be
       investigated by audit services staff, with support as needed from the law
       department and corporate security. Management of the relevant business
       units will be involved as appropriate. Matters involving equal employment
       opportunity issues usually will be referred to the equal opportunity
       department. Matters arising within a business unit may be investigated by
       management of that unit, after consulting with audit services and the law
       department. Independent counsel or auditors may be retained to handle or
       assist with investigations that involve allegations against directors or
       elected officers or that otherwise may have a significant impact on the
       affected company.
<PAGE>

       The American Dairy, Inc. companies and their officers, employees,
       contractors, subcontractors, and agents shall not discharge, demote,
       suspend, threaten, harass, or in any other manner discriminate against an
       employee in the terms and conditions of employment because of any lawful
       act done by the employee to provide information, cause information to be
       provided, or otherwise assist in an investigation regarding any conduct
       which the employee reasonably believes violates any federal or state
       laws, when the information or assistance is provided to regulatory or law
       enforcement agencies, anyone with supervisory authority over the
       employee, the Business Conduct and Ethics Hotline, or anyone conducting a
       duly authorized investigation for the companies.

       The Business Conduct and Ethics Officer is Kirk G. Downing and the
       Hotline telephone number is (323)935-3517.

<PAGE>

                   COMPLIANCE RESPONSIBILITIES AND PROCEDURES

Responsibilities.

Individuals.

As a director, officer, or employee of any of the companies you are personally
responsible for your own compliance with this code and the other policies of
your company. You are expected to read and become familiar with this code and
other applicable policies. You are expected to cooperate fully with all duly
authorized investigations of violations of this code and other policies of the
companies. If you violate this code or other policies you will be subject to
appropriate disciplinary action as described below.

Boards of Directors.

The board of directors of each American Dairy, Inc. company is responsible for
the ultimate direction of the business and affairs of that company, including
matters related to this code and company policies. This code has been approved
by the boards of directors of American Dairy, Inc. and its major subsidiaries.
Those boards of directors also have adopted compliance and ethics programs and
appointed a compliance and ethics officer for each company and its subsidiaries.
The boards of directors regularly receive reports from management, the general
auditor, and the compliance and ethics officers about compliance and ethics
matters.

Management.

Acting under the direction of the board of directors, the management of each
company has day-to-day responsibility for compliance and ethics matters,
including the implementation and enforcement of this code and related policies.
Much of this responsibility is delegated to the compliance and ethics officer,
general auditor, and general counsel, but each officer and manager is expected
to be involved actively in promoting compliance with this code and related
policies, encouraging high ethical performance, and dealing with violations of
this code.

Certifications.

Officers and key employees of the companies are required each year to complete
and sign a certification as to their compliance with this code and related
policies. Under the direction of the general auditor, audit services personnel
review all of the completed certifications, investigate any exceptions, and
follow up as necessary. The compliance and ethics officer, general counsel, and
other officers of each company become involved as necessary to deal with
significant exceptions reported in the certifications.

<PAGE>

Investigations.

All reports of violations of this code will be investigated as discussed above.
Matters having corporate significance (as defined below) should be brought to
the attention of the general auditor, the general counsel, and the compliance
and ethics officer of the affected companies. Matters of corporate significance
also should be reported regularly to the board of directors or audit committee
of the affected company. "Corporate significance" means that a matter is
important to the affected company as a whole because the matter could have a
material financial impact on the company, raises serious questions about the
company's systems of internal control, involves wrongdoing by a director or
officer, involves a serious legal violation, or otherwise could have a material
adverse effect on the affected company. Because corporate significance may not
always be readily apparent, if you have any questions you should contact the
general auditor, the general counsel, or the compliance and ethics officer for
your company.

Discipline.

All violations of this code will be considered for appropriate disciplinary
action against the violators. Disciplinary actions, depending on the seriousness
of the violation, may include:

o  Oral counseling;

o  Written reprimand;

o  Suspension,

o  Demotion, and

o  Termination.


Managers and supervisors have the primary responsibility for administering
employee discipline in accordance with company policies. They should seek to
ensure that disciplinary actions are prompt, fair, and consistent. In dealing
with matters of corporate significance, managers and supervisors should consult
with their management and compliance and ethics officer. The senior management
of each business unit should ensure that disciplinary actions are being handled
appropriately within their unit.

Disciplinary actions involving directors or elected officers (vice presidents or
above) must be handled by or under the direction of the board of directors or a
board committee of the affected company. The board of directors, senior
management, general counsel, and ethics and compliance officer of each company
should oversee the disciplinary process and results to ensure that the
objectives of this code are being met.

<PAGE>

Waivers.

Waivers of this code should not be granted lightly and should be rare. A waiver
should be granted only when it is consistent with the overall best interests of
the companies and their investors.

Waivers of this code for directors or elected officers (vice presidents or
above) may be made only by the applicable board of directors or a board
committee. Waivers for other employees may be made by the vice president or
equivalent manager that heads the employee's business unit, or a senior officer
to whom the employee reports directly or indirectly. The applicable compliance
and ethics officer should be consulted on all potential waivers. The chief
executive officer and general counsel of the affected company should be advised
of all waivers.

Amendments or waivers of code provisions relating to directors and elected
officers who are covered by rules of the Securities and Exchange Commission and
stock exchanges on which securities of the companies are listed (including
principal executive officers, principal financial officers, principal accounting
officers or controllers, or officers performing similar functions) must be
publicly and promptly disclosed in accordance with those rules.

                      Where to Go for Information and Help.

The right course of action is not always clear. You may have questions about how
this code should be interpreted or applied in particular circumstances. Or
situations may arise that are not directly covered by this code or other company
policies. If you have questions about whether what you are about to do is
ethical or legal, you should take one or more of the following actions:

o  Talk to your immediate manager or supervisor. If you are unsure about
   the direction you are receiving from your immediate manager or supervisor,
   and you are unable to resolve the matter with him or her, you may talk with
   a more senior manager or officer.

o  Refer to the written policies, manuals, procedures, and other materials
   maintained by your company for additional guidance. Some of those materials
   are described below.

o  Contact the compliance and ethics officer for your company. He or she can
   provide advice about the code and help you get information and other
   resources to resolve questions. Contact information is provided below.

o  Contact the law department if your questions relate to legal issues or
   matters being handled by company lawyers. You may contact a lawyer with
   whom you have been working or a more senior member of the law department,
   including the general counsel.

<PAGE>

o  Call the Business Conduct and Ethics Hotline. The Hotline is staffed by
   an independent provider; and management assures you that you can contact
   the Hotline anonymously, confidentially, and without any retaliation
   against you for making a report or asking a question in good faith. If you
   want a response to a question, you may provide a phone number or e-mail
   address at which you can be contacted, or, if you want to remain anonymous,
   you may arrange to call back later for the response after the matter has
   been investigated. The Business Conduct and Ethics Officer is Kirk G.
   Downing and the Hotline Telephone Number is (323) 935-3517.


                              American Dairy, Inc.

The American Dairy, Inc. compliance and ethics officer is:

     Mr. Liu Hua
     Chief Financial Officer, Secretary and Treasurer
     C-16 Shin Chen International Building, No. 10
     Jiu-shen Road, Zho Yan Chu, Beijing
     The People's Republic of China
     Phone: 011-86-10-64376768


The American Dairy, Inc. general auditor is:

     Henny Wee
     Belmont Capital Group Limited
     Suite A-C, 20/F Neich Tower
     128 Gloucester Road, Wanchai
     Hong Kong, The People's Republic of China
     Phone: 011-852-2517-7833
     Fax: 011-852-2548-7788

The Business Conduct and Ethics Officer is Kirk G. Downing and the Hotline
Telephone Number is (323) 935-3517