Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Danone launches proceedings against Fonterra over food scare

France’s Danone launches court action against Fonterra over food scare, ends supply contract

By Paul McBeth

Jan. 9 (BusinessDesk) - Danone, the world’s biggest yoghurt maker, has launched legal proceedings against Fonterra Cooperative Group over last year’s whey protein concentrate recall and ended its existing supply contract with the New Zealand dairy exporter.

The Paris-based food processing company is initiating proceedings in the New Zealand High Court and arbitration proceedings in Singapore “to bring all facts to light and to obtain compensation for the harm it has suffered,” it said in a statement. Danone put the cost of last year’s WPC 80 recall at 350 million euros when it announced its third-quarter results, while Auckland-based Fonterra recognised a contingent liability of just $14 million in its own accounts.

Last August, Fonterra quarantined several batches of whey protein concentrate amid fears it was contaminated with a potentially dangerous form of the clostridium bacteria. The whey protein was ultimately cleared as a false alarm.

Danone will also terminate existing supply contract with Fonterra and make “any further collaboration contingent on a commitment by its supplier to full transparency and compliance with the cutting-edge food safety procedures applied to all products supplied,” it said.

“As a leading food company, Danone makes food safety an absolute priority and is committed to working only with suppliers that share and respect the same demanding professional standards,” it said.

Of the eight customers affected by Fonterra’s recall, the New Zealand company agreed to a commercial outcome with all of them except Danone, including extending supply contracts for the next 10 years and agreeing to volume increases.

In December, Fonterra chief executive Theo Spierings said he expected any court action would show the New Zealand company has no liability in its contract.

NZX-listed units in the Fonterra Shareholders’ Fund were unchanged at $5.86 yesterday, while shares in Danone fell 1.3 percent to 51.17 euros.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Statistics: Business Research And Development Up 29 Percent

Computer services and machinery manufacturing firms led the way in an almost 30 percent lift in business spending on research and development (R&D) in 2016, Stats NZ said today. Businesses spent $1.6 billion on R&D in 2016, up $356 million (29 percent) from 2014. More>>

ALSO:

China Shopping: NZ-China FTA Upgrade Agreed Among Slew Of New Deals

New Zealand Prime Minister Bill English and China Premier Li Keqiang signed off a series of cooperation deals spanning trade, customs, travel and climate change and confirmed commencement of official talks on an upgrade to the nine-year old free-trade agreement between the two countries. More>>

ALSO:

Media: TVNZ Flags Job Cuts To Arrest Profit Decline

Chief executive Kevin Kenrick said the changes were aimed at creating "a sustainable future video content business for TVNZ in an ever-changing media market." More>>

ALSO:

Reserve Bank: Wheeler Keeps OCR At 1.75%

Reserve Bank governor Graeme Wheeler kept the official cash rate unchanged at 1.75 percent, as expected, and reiterated his view that the benchmark rate doesn't need shifting for the foreseeable future. More>>

ALSO:

Trade Plans: Prime Minister's Speech To International Business Forum

"The work to improve public services, build infrastructure, and solve social problems is possible only because we have enjoyed sustained, solid economic growth. A big reason for that is the Government’s consistent agenda of economic reform, and our determination to open up more opportunities for trade with the world." More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news