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UNITED STATES DEPARTMENT OF AGRICULTURE 

AGRICULTURAL MARKETING SERVICE 

BEFORE THE ADMINISTRATOR 

 

In re: 

Qufu Shengren 

Pharmaceutical Co., Ltd. 

 

Shandong, China 

 

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Administrator’s Decision 

APL-68-20

 

 

 

This Decision responds to an appeal (APL-068-20) of a Notice of Noncompliance and 

Proposed Suspension of National Organic Program (NOP) certification issued to Qufu Shengren 

Pharmaceutical Co., Ltd. (Qufu) of Shandong, China by Certification of Environmental 

Standards GmbH (CERES), an USDA-accredited certifying agent. The operation has been 

deemed not in compliance with the Organic Foods Production Act of 1990 (Act)1

 and the U.S. 

Department of Agriculture (USDA) organic regulations.2

BACKGROUND 

The Act authorizes the Secretary to accredit agents to certify crop, livestock, wild crop, 

and/or handling operations to the USDA organic regulations (7 C.F.R. Part 205). Certifying 

agents also initiate compliance actions to enforce program requirements, as described in section 

205.662, Noncompliance procedure for certified operations. Persons subject to the Act who 

believe they are adversely affected by a noncompliance decision of a certifying agent may appeal 

1

 7 U.S.C. 6501-6522 

2

 7 C.F.R. Part 205 
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such decision to the USDA Agricultural Marketing Service (AMS) pursuant to §205.680 

Adverse Action Appeals Process – General, and § 205.681, Appeals of the USDA organic 

regulations. 

FINDINGS OF FACT 

1. On May 19, 2015, Qufu was certified organic for the scope of handling by USDA-accredited 

certifier Kiwa BCS Oko-Garantie GmbH (Kiwa). 

2. On January 31, 2016, CERES certified Qufu organic for handling. 

3. On February 28, 2017, CERES certified Qufu organic for crops for its Xingiang and Gansu 

locations. 

4. On February 15, 2019, Qufu surrendered its CERES crop certification for both farms. 

5. On March 5, 2019, USDA-accredited certifier Letis, S.A. certified Qufu organic for crops at 

the Gansu location. 

6. On June 4, 2019, Letis, S.A. certified Qufu organic for crops at the Xingiang location. 

7. On September 19, 2019, Qufu notified Letis, S.A. that it was surrendering the crop 

certification for the Gansu location. Letis S.A. processed this surrender on February 3, 2020. 

Letis, S.A. currently certifies only the Xingiang location for crops. 

8. On April 16, 2020, USDA-accredited certifier NASAA Certified Organic (NCO) certified 

Qufu organic for crops at the Gansu location. 

9. On May 20, 2020, CERES issued Qufu a Notice of Noncompliance and Proposed Suspension 

for its handling certification. 

10. On May 27, 2020, Qufu requested mediation. 

11. On June 2, 2020, CERES denied Qufu’s mediation request. 

12. On June 9, 2020, Qufu filed an Appeal. 
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DISCUSSION 

The USDA organic regulations at 7 CFR §205.103, Recordkeeping by certified 

operations, state that, “(a) A certified operation must maintain records concerning the 

production, harvesting, and handling of agricultural products that are or that are intended to be 

sold, labeled, or represented as “100 percent organic,” “organic,” or “made with organic 

(specified ingredients or food group(s)”). (b) Such records must: ... (2) Fully disclose all 

activities and transactions of the certified operation in sufficient detail as to be readily 

understood and audited; ... (4) Be sufficient to demonstrate compliance with the Act and the 

regulations in this part...” 

The organic regulations at §205.105, Allowed and prohibited substances, methods, and 

ingredients in organic production and handling, state that, “To be sold or labeled as “100 percent 

organic,” “organic,” or “made with organic (specified ingredients or food group(s)),” the product 

must be produced and handled without the use of: (a) Synthetic substances and ingredients, 

except as provided in §205.601 or §205.603...” The specific synthetic substances on the 

National List which are allowed for use in organic crop production are identified at §205.601. 

The organic regulations at §205.201, Organic production and handling system plan, state 

that, “(a) The producer or handler of a production or handling operation ... must develop an 

organic production or handling system plan that is agreed to by the producer or handler and an 

accredited certifying agent... An organic production or handing system plan must include: (1) A 

description of practices and procedures to be performed and maintained...; (2) A list of each 

substance to be used as a production or handling input...(3) A description of the monitoring 

practices and procedures to be performed and maintained...(4) A description of the 

recordkeeping system implemented to comply with the requirements...(5) A description of the 
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management practices and physical barriers established to prevent commingling of organic and 

nonorganic products on a split operation and to prevent contact of organic production and 

handling operations and products with prohibited substances...” 

The organic regulations at §205.270, Organic handling requirements, state that, “(c) The 

handler of an organic handling operation must not use in or on agricultural products intended to 

be sold, labeled, or represented as “100 percent organic,” “organic,” or “made with organic 

(specified ingredients or food group(s)),” ... (1) Practices prohibited under paragraphs (e) and (f) 

of §205.105.” 

The organic regulations at §205.272, Commingling and contact with prohibited substance 

prevention practice standard, state that, “(a) The handler of an organic handling operation must 

implement measures necessary to prevent the commingling of organic and nonorganic products 

and protect organic products from contact with prohibited substances. (b) The following are 

prohibited for use in the handling of any organically produced agricultural product...(2) The use 

or reuse of any bag or container that has been in contact with any substance in such a manner as 

to compromise the organic integrity of any organically produced product or ingredient placed in 

those containers...” 

The organic regulations at §205.300, Use of the term, “organic,” state that, “(a) The term, 

“organic,” may only be used on labels and in labeling of raw or processed agricultural products, 

including ingredients, that have been produced and handled in accordance with the regulations in 

this part.” 

The organic regulations at §205.400, General requirements for certification, state that, “A 

person seeking to receive or maintain organic certification under the regulations in this part must: 

(a) Comply with the Act and applicable organic production and handling regulations of this part; 
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(b) Establish, implement, and update annually an organic production or handling system plan 

that is submitted to an accredited certifying agent... (d) Maintain all records applicable to the 

organic operation for not less than 5 years beyond their creation and allow authorized 

representatives of the ...certifying agent access to such records during normal business hours for 

review and copying to determine compliance with the Act and the regulations in this part...(f) 

Immediately notify the certifying agent concerning any: (1) Application, including drift, of a 

prohibited substance to any field, production unit, site, facility, livestock, or product that is part 

of an operation...” 

CERES found numerous prohibited substances on organic stevia leaves sampled at a 

handling inspection of Qufu, as well as numerous noncompliances regarding recordkeeping, 

failure to follow their organic management plan (OMP), commingling of and failure to 

distinguish between organic and conventional stevia leaves, and not following proper intake 

procedures. 

Qufu states that the contamination of organic stevia leaves with conventional stevia 

leaves was due to human error and it was explained at the inspection. Qufu states there are no 

noncompliances in its production line, facilities, and process, and that it has conducted additional 

training of staff on management procedures. Qufu also states it took samples of finished organic 

stevia leaves and no pesticides were found. 

A review of the evidence shows that CERES conducted an inspection of Qufu’s handling 

operation on April 23 and 24, 2020, at which samples were taken of packaged organic stevia 

leaves in Qufu’s warehouse from Batch YJCP-20181009-XG-1. Qufu produces and handles its 

own organic and conventional stevia leaves. The ‘2018’ in the batch number represents the 2018 

crop, while the XG represents Qufu’s Gansu Farm in Xiagou Village as the source of the stevia 
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leaves. The laboratory analysis report of May 14, 2020 from Eurofins’ testing of the sample 

revealed the presence of the following prohibited substances: Acetamiprid, Azoxystrobin, 

Chlorantraniliprole, Clothianidin, Difenoconazole, Imidacloprid, Metalaxyl, 

Metalaxyl1//Metalaxyl-M, Methoxyfenozide, Metolachlor, Pyraclostrobin, Thiamethaxam, 

Bifenthrin, Chlorfenapyr, Cyfluthrin, Cyfluthrin/lambda, Indoxacarb, Procymidone, Folpet/PI, 

and Phthalimide. None of the substances have an EPA (Environmental Protection Agency) 

tolerance level for stevia leaves except s-Metolachlor, and none of the synthetic substances are 

listed as allowed on the National List. An EPA tolerance sets a maximum limit for a specific 

pesticide residue on specific agricultural commodities. 

CERES’ Inspection Report for the April 2020 inspection, as well as the final Inspection 

Findings sheet also state that Qufu’s OMP is incomplete, Qufu hasn’t implemented corrective 

actions, there is no proper reception/intake procedure, there is insufficient risk management or 

oversight of suppliers and supplier information, and records are incomplete or missing, including 

declarations for non-agricultural ingredients and purchase documents. CERES also noted there 

was contamination of the organic stevia leaves by conventional materials; organic and 

conventional stevia leaves are stored in the same warehouse in close proximity to each other; and 

incoming records don’t reflect whether the suppliers are organically certified and if package 

labels reflect organic status of the materials, batch number, or quantity. CERES also noted there 

was a lack of knowledge of organic processes by Qufu’s employees. 

Qufu requested mediation arguing several points, which CERES responded to 

individually in its Notice of Mediation Denial. Qufu made the same arguments in its Appeal. 

Qufu acknowledged the contamination of organic stevia leaves by non-organic stevia leaves, but 

states it was due to human error, and all the contaminated stevia leaves in the warehouse were 
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destroyed. Qufu also stated during the inspection that there was no inventory of organic stevia 

leaves from 2019 to demonstrate organic processing to the inspector; and therefore, leaves from 

2018 were used. However, while Qufu identified the 2018 Batch as YJYL-20180928-DW-1, 

from Qufu’s Gansu Farm in Dongwant Village, the May 14, 2020 Eurofins lab report cited above 

shows the sample tested by CERES was from Batch YJCP-20181009-XG-1 which is from the 

Gansu Farm in Xiagou Village. The batch numbers also don’t match. Qufu also contends it told 

the inspector that conventional stevia leaves had been mixed with organic stevia leaves, and the 

finished product would be sold as conventional. However, Qufu then identified the Batch as 

YJCP-20200423-RA-60, which is from a 2020 crop, and doesn’t identify the source; whereas 

CERES had sampled and tested a 2018 batch. The inspector found Qufu doesn’t have any 

outside sources and produces all of its own organic stevia leaves. CERES confirms that Qufu 

told the inspector about the alleged commingling error but states that Qufu didn’t include this 

information in its OMP of April 2020 as it was required to do, didn’t otherwise report the 

incident, and didn’t remove the organic labels from the contaminated bags of stevia leaves. 

Qufu stated that the mixing of organic and conventional stevia leaves occurred when it 

was transporting loose conventional stevia leaves, specifically tons bags on April 3, 

2020 from the warehouse. Qufu states the truck scraped a stack of bagged organic stevia leaves 

and the organic packages fell onto the transport vehicle and broke open. The mixed leaves were 

repacked and marked with the original organic outer bag noting Batch YJYL-20181008-XG-1 

and put in the organic area of the warehouse. However, this is not the same batch number that 

was sampled by CERES during the inspection, and also doesn’t match the batch number for 2018 

identified by Qufu as being used during the inspection or the batch number identified by Qufu as 

/ (b) (4) (b) (4)
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the finished product that would be sold as conventional due to contamination. It appears that 

more than 1 batch was contaminated, as Qufu has identified different batch numbers. 

Further, CERES states that pictures taken at the inspection show closed and labeled bags, 

not loose leaves in warehouse, and that Qufu stated in its OMP that it separates and labels the 

organic and conventional stevia leaves at all points in the processing and handling steps. 

Therefore, CERES contends that if Qufu had implemented its own procedures, the accident 

described by Qufu should not have been possible. Pictures submitted by CERES show the bags 

of organic and conventional stevia leaves stacked in the warehouse and there are no loose leaves 

seen. Lastly, while Qufu stated the conventional stevia leaves being transported were loose, it 

then identified them as bags. 

Qufu stated that since the organic stevia leaves couldn’t be distinguished from the 

conventional stevia leaves, when the warehouse found that commingling had occurred, it was 

reported to quality control that the tons of mixed leaves couldn’t be used in organic 

production. However, Qufu states that one of their employees left and the new employee wasn’t 

familiar with procedures and failed to downgrade the leaves pursuant to procedure and the 

organic stevia leaves were still listed in the organic ledger. CERES replied that if Qufu’s 

procedures to ensure organic integrity of its products are so weak that a change in an employee 

results in a breakdown of procedures, Qufu isn’t ‘certifiable.’ The alleged accident that caused 

the commingling should have resulted in Qufu taking measures to ensure that the mixed 

contaminated leaves weren’t used in organic production, labeled as organic, or listed in any 

documentation/ledger as organic. Qufu should have ensured that any employee handling organic 

stevia leaves or involved in the organic process/handling, was aware of the procedures and 

capable of complying with them. Instead, Qufu rebagged the contaminated leaves in an organic 

(b) (4) (b) (4)
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labelled bag. This also contrasts with Qufu’s statement that all contaminated organic stevia 

leaves had been destroyed. 

Qufu also stated that Batch YJYL-20181008-XG-1 of tons, which was 

contaminated, was put in storage on June 28, 2019, and hasn’t been sold or used for organic 

production. This is the same batch number identified above as being rebagged, marked and 

labeled as organic after the alleged accident despite the mixture of organic and conventional 

stevia leaves. However, this is not the batch from which CERES took and tested a sample. Qufu 

states other batches of organic stevia leaves that had been put in the same stack with mixed 

leaves were also downgraded as non-organic. However, CERES stated that at the inspection in 

April 2020, the downgrading of the contaminated leaves hadn’t yet been done. Further, Qufu 

said that only organic lots had lot numbers on the bags. Therefore, the bags used for sampling, 

as they were allegedly contaminated, shouldn’t have had lot numbers on them. As CERES 

concluded, Qufu hadn’t downgraded the contaminated leaves and only stated it would do so after 

the prohibited substances were found on the samples. 

Qufu stated that it plans on building a separate warehouse for its organic stevia leaves 

and organic materials to avoid contamination by conventional stevia leaves. However, while 

CERES replied that it is a ‘good plan for the future,’ Qufu’s current processes are inadequate and 

unreliable. Further, any plan to provide for separation of organic and conventional stevia leaves 

in the future doesn’t negate Qufu’s prior and current noncompliances which by Qufu’s own 

admission allowed the mixing of organic and conventional stevia leaves. Qufu also stated in its 

Appeal that it would re-purchase new raw organic materials and make sure that its warehouse is 

thoroughly cleaned and that its staff are re-trained. However, again this doesn’t negate the 

(b) 

(4)
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noncompliances and commingling of organic and conventional stevia leaves, nor the finding of 

multiple prohibited substances on the sampled organically-labeled stevia leaves. 

Qufu also stated in its Appeal as well as its July 8, 2020 statement to NOP, that is has retrained its warehouse teams on organic procedures, required information on intake 

documentation, and management procedures after realizing there were deficiencies. Qufu 

submitted a Training Record from a May 16, 2020 training on storage and labeling procedures, 

as well as a Training Record from a May 16 – 17, 2020 training on processing regulations, 

cleaning, and sanitation, with both being signed by attending employees, along with pictures of 

the training sessions. However, the recent training of staff on organic processing and related 

matters doesn’t negate the finding of numerous prohibited substances on organic stevia leaves. 

Further, Qufu’s OMP already identified its processes, and the alleged accident shows that Qufu 

hadn’t complied with its own processes. 

Qufu also stated in its additional July 8, 2020 statement that it took samples from the 

products with the contaminated organic leaves and lab analysis confirmed the presence of 

pesticide residues on the leaves, and therefore, those products will be sold as conventional 

products. Qufu submitted a Eurofins lab report of June 22, 2020 for Batch YB20200612 which 

shows a finding of Procymidone at 0.34 mg/kg; Difenoconazole at 0.012 mg/kg; and Metalaxyl 

at 0.028 mg/kg. Since Qufu states the sample for this test was taken from the contaminated 

organic stevia leaves, a finding of prohibited substances is expected. However, this sample was 

taken from a 2020 batch, whereas CERES took samples from a 2018 batch at the inspection and 

also found prohibited substances. It appears that more than just one 2018 batch was 

contaminated. Further, there are no identifiers on this sampled batch as to where the stevia 

leaves originated. 
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Qufu also submitted Eurofins lab reports of April 25, 2020 for an April 15, 2020 sample 

from Batch YJCP-20200309; April 25, 2020 for an April 15, 2020 sample from Batch YJCP20200324; and June 16, 2020, for a June 14, 2020 sample from Batch YJCP-20200321. These 3 

lab reports do not show the detection of any pesticides. However, these samples were taken from 

different batches than the sample taken by CERES during the inspection; were taken after the 

inspection; have no identifiers as to where these batches were grown; and Qufu took the samples 

itself with no oversight by CERES. 

Several of the substances detected on the organic stevia leaves, as seen in the above 

referenced Eurofins lab report of May 14, 2020 are pesticides, while Qufu states in its OMP that 

it doesn’t use pesticides. However, while the substances were found on the organic stevia leaves 

at Qufu’s warehouse, CERES didn’t sample and test organic stevia leaves in the crops grown by 

Qufu at the Gansu and Xingiang farms since CERES no longer certifies Qufu for crops. 

However, Qufu’s explanation of an accident resulting in commingling is implausible. The 

organic and conventional stevia leaves are already packaged in bags when placed in the 

warehouse and aren’t transported or stored as loose leaves. Therefore, the alleged scraping of 

bags of organic stevia leaves with a truck carrying loose conventional stevia leaves, resulting in 

commingling, wouldn’t have been possible. Rather, the finding of prohibited substances on the 

CERES-sampled 2018 batch of organic stevia leaves; Qufu’s reference to other 2018 batches 

being contaminated other than that sampled and tested by CERES; and Qufu’s own sampling and 

testing of 2020 batches on which prohibited substances were found, points to the use of 

prohibited substances on the organic stevia crops prior to harvest, transport, and packaging. 

Further, while admitting to a commingling accident, Qufu states it rebagged the contaminated 

organic stevia leaves in a bag labelled organic, and CERES found Qufu didn’t remove the 
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contaminated organic stevia leaves from the organic ledger. The finding of prohibited 

substances and Qufu’s actions justified CERES’ issuance of a combined Notice of 

Noncompliance and Proposed Suspension. 

CONCLUSION 

The USDA organic regulations assure consumers that products with the USDA organic 

seal meet consistent, uniform standards. Key to these standards is that products with the USDA 

organic seal are produced and handled in accordance with the organic regulations. However, the 

evidence substantiates that Qufu violated the organic regulations at 7 C.F.R. §205.102, Use of 

the term “organic:’ 7 C.F.R. §205.103, Recordkeeping by certified operations; 7 C.F.R. 

§205.105, Allowed and prohibited substances, methods, and ingredients in organic production 

and handling; 7 C.F.R. §205.201, Organic production and handling system plan; 7 C.F.R. 

§205.270, Organic handling requirements; 7 C.F.R. §205.272, Commingling and contact with 

prohibited substance prevention practice standard; 7 C.F.R. §205.300, Use of the term, 

“organic;” and 7 C.F.R. §205.400, General requirements for certification. Specifically, evidence 

substantiates that prohibited substances were found on organically-labeled stevia leaves from 

both the 2018 and 2020 crops of Qufu. Evidence substantiates that Qufu commingled organic 

stevia leaves with conventional stevia leaves; failed to take appropriate measures to prevent the 

contamination of organic stevia leaves by conventional stevia leaves; failed to segregate 

contaminated organic stevia leaves and then record/downgrade and properly label the 

contaminated stevia leaves; and failed to report the commingling to CERES. Qufu also failed to 

comply with its own OMP; failed to follow proper reception/intake procedures and obtain all 

required information on raw materials/ingredients; failed to follow proper processing/handling 
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procedures; failed to ensure risk management/oversight of its suppliers; failed to maintain 

adequate records, including purchase documents; and failed to ensure that its staff were properly 

and adequately trained on organic processes. Therefore, Qufu may not remain certified. 

DECISION

The June 9, 2020 Appeal is denied, and the May 20, 2020 Notice of Noncompliance and 

Proposed Suspension as to Qufu’s handling certification is affirmed. Both the CERES-issued 

handling certification as well as the Kiwi-issued handling certification are suspended. While its 

handling certification is suspended, Qufu may not represent, sell, or label stevia leaves from the 

handling operation as organic. However, pursuant to 7 C.F.R. §205.662(f)(1), Qufu may apply 

for reinstatement of its handling certification at any time, though it must correct all 

noncompliances and provide evidence of such before reinstatement will be granted. 

Attached to this formal Administrator’s Decision denying Qufu’s Appeal is a Request for 

Hearing form. Qufu has thirty (30) days to request an administrative hearing before an 

Administrative Law Judge. If Qufu waives the hearing, this Administrator’s Decision 

suspending Qufu’s handling certification will become final. 

Done at Washington, D.C., on this _____ 

day of ________________, 2020.

_________________________________

Bruce Summers 

Administrator

Agricultural Marketing Service

 29th

 December

BRUCE SUMMERS Digitally signed by BRUCE 

SUMMERS 

Date: 2020.12.29 20:16:40 -05'00'