AUSTRALIA has been caught up in an international "honey laundering" scam in which Chinese honey is disguised and sold as the product of another country.

The illegal scheme follows the collapse of bee colonies in the US and Europe, creating a shortage of honey and the bees necessary to pollinate crops, The Times and The Australian report.

In the scam, drums of honey are shipped from China, usually to a distributor outside the country, who then repackages and re-exports it. In one case, drums of Chinese honey were marked "Polish Light Amber Honey".

In 2003, Melbourne-based agents of a Chinese firm rebadged Chinese honey as Australian and onsold it to the US. As a result Australia is on a list of 13 countries whose honey products must be carefully checked on entry to the US.

Lindsay Bourke, chairman of the Australian Honeybee Industry Council and head of a large honey products business in Tasmania, said the Australian honey industry had been "tarred with the same brush" as disreputable operators in countries such as China, Malaysia and Russia.

The Melbourne operators were charged and fined $489,000 for importing and rebadging 125 containers holding 1.7 million litres of Chinese honey sold to the US.

The elaborate subterfuge is to avoid heath and safety checks, import fees and tariffs imposed by the US and other countries on Chinese food products.

Health officials fear a repeat of the tainted bably milk and pet food scandals that dominated headlines this year.

Read more on The Times online.