Lactalis Australia fined US$41,700 for misleading milk labelling

AUSTRALIA – Lactalis Australia has been fined US$41,700 (AUD $59,400) in penalties by the country’s competition regulator, after allegedly making misleading claims in the labelling of two of its milk products.

The Australian Competition and Consumer Commission (ACCC) alleges that the dairy group’s Golden North ‘Country Fresh’ 2L milk and Ferguson Valley ‘WA Dairy Fresh’ 2L milk products were labelled as fresh milk, despite both containing ‘substantial’ amounts of powdered reconstituted ingredients.

The regulator carried out a broader investigation into Australia’s milk processing industry, gathering information on the products of several major dairy companies and retailers.

While it found that processors and retailers largely label fresh milk products accurately, Lactalis was found to have added significant amounts of reconstituted skim milk and lactose to its Golden North ‘Country Fresh’ 2L milk. It was also found to have added substantial amounts of reconstituted lactose to its Ferguson Valley ‘WA Dairy Fresh’ 2L milk.

Mick Keogh, deputy chair of the ACCC, said: “Consumers should be able to trust product labels as accurate descriptions of the products they are buying, particularly for everyday groceries such as milk”.

“We were very concerned that prominent ‘fresh’ claims on these products may have been misleading, as consumers would not expect fresh milk to contain substantial amounts of powdered, reconstituted ingredients.”

He added that all businesses across the food processing industry should be aware of the importance of labelling food truthfully and accurately, risking “serious consequences” if they make misleading claims.

Owned by the multinational Lactalis Group, Lactalis Australia produces a variety of dairy products across its portfolio of brands. These include Pauls, Harvey Fresh, Oak, Vaalia and Ice Break.

The ACCC, responsible for ensuring fair trading and product safety across Australia, issues infringement notices when it has ‘reasonable grounds’ to believe a company has breached consumer law provisions.

The payment of penalties does not equate to an admission of contravention of the Australian Consumer Law.

Lactalis was fined $950,000 by the ACCC in 2022 for breaching the Dairy Code of Conduct by failing to meet certain obligations in the 2020-21 milk season.

The ACCC argued that such breaches weakened the bargaining power of farmers, who rely on clear, accessible contracts to make informed decisions about their livelihoods.

The Federal Court agreed, emphasizing that compliance with the Code is not optional. The fine was intended not only as punishment but also as a deterrent to other processors who might consider sidestepping their obligations.

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