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Long-Running UK Butter And Cheese Cases Settled

For Immediate Release
11 December 2003

Long-Running UK Butter And Cheese Cases Settled

Fonterra Chief Development Officer Alexander Töldte today announced the successful resolution of the long-standing legal dispute with UK Customs involving imports of New Zealand butter and cheese into the European Union in the mid-1990s.

The dispute related to demands by UK Customs for £323 million in back-duties for product imported by subsidiaries of the New Zealand Dairy Board. This followed an audit by the EU Court of Auditors in 1996, which criticised various import procedures that had been in place for several decades.

"The claims were complex and highly technical," said Mr Töldte. "They involved the interpretation of EU quota requirements relating to product composition, method of manufacture, weight of butter and cheese and customs procedures for the importation of the products."

After various reviews by UK and EU authorities, and numerous court hearings, it has now been agreed that duties totalling £11 million are due, which will be met from funds already held by UK Customs.

The previous quota regime has since been replaced by a new and exacting compliance and testing regime. Fonterra has been working closely with the UK, EU and New Zealand authorities to ensure that problems of the 1990s cannot recur. "Fonterra is committed to absolute integrity and full compliance in all its businesses around the world," said Mr Töldte. "The settlement in the UK brings welcome closure to this whole affair."

- Ends -

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