The multi-million-dollar racket has been exposed in a World Health Organisation (WHO) report. The blood, coming from one of the nations most seriously affected by Aids, was often labelled as "animal plasma" to avoid the strict checks designed to ensure that only healthy blood gets through.

Investigations so far show that the blood has mainly been moved on to China and India, where thousands faced contamination from it. There is no evidence that any of it found its way into British hospitals.

A spokesman for the Department of Health said last night: "All our blood is tested and double tested. There's an enormous amount of checks made to make sure blood used in our hospitals is safe. We're not aware of any investigation into South African blood at the moment."

However, British police are now "consulting" other European forces over the investigation.

At least two British companies, one based in Guernsey and the other in Berkshire, have been investigated by Austrian detectives. They say unscrupulous processing companies in several countries relabelled the contaminated blood as fit for therapeutic use, then sold it on to India and China.

Several blood brokers are due to appear in court in Austria, facing charges of fraudulent trading and endangering public health. A British Aids expert, Professor Alan Smith, initiated the investigation when he alerted police after he uncovered what he described as the "highly unethical" trafficking while he worked in the virology department of Natal University.

His complaints led the South African Department of Health to commission a WHO blood expert, Dr Wilbert Bannenberg, to investigate. His report estimates that in the past decade the brokers made more than £7m from processing and relabelling blood that is given free in South Africa as "a gift of life".

Bannenburg's report called for an urgent toughening of South Africa's blood export controls. He found that permits for the import and export of blood products between 1997 and 1999 had been inexplicably lost, while current information on permits was "so vague that authorities were unable to determine the source or final destination of the products".

Large amounts of human plasma were classified and exported as "animal plasma" to avoid fears over the scale of South Africa's Aids problem - 3.5m people are infected.

Documents dated 1995 and now with Canadian police showed 15 shipments of "animal plasma" were flown to Belgium, where they were relabelled as human blood from Canada and sold on to a North American company's German plant for processing.

Thousands of people are thought to have been in danger of contracting Aids and hepatitis from plasma made there.

In 1998, Austrian authorities seized 4,000 litres of blood from a Linz-based company, Albovina AG, after a tip-off. The blood was infected with hepatitis B and HIV. The Austrian investigation found that the blood had been shipped to Austria through Guernsey by a South African company.