Price-fixing probe into 5 makers of formula
By Ding Yining |
July 3, 2013, Wednesday
|
Print Edition
Print Edition
FIVE foreign manufacturers of infant formula are being investigated by China's top economic planner over suspected price-fixing.
The five companies are Nestle SA, Abbott Laboratories, Mead Johnson Nutrition Co, Danone's Dumex brand and Wyeth Nutrition.
The People's Daily, citing an unidentified source close to the National Development and Reform Commission's anti-monopoly division, said there was evidence that the price of milk powder sold by these companies had risen by about 30 percent since 2008.
Calls to the NDRC were unanswered yesterday afternoon, and there was no information about the investigation on its official website.
Nestle, Mead Johnson and Wyeth said they were cooperating with the investigation, according to Reuters.
Abbott refused to comment and Dumex couldn't be reached.
The investigation comes as China is making efforts to revitalize and consolidate the domestic milk formula industry after a series of food safety crises, including the melamine-tainted milk scandal of 2008, damaged the industry's reputation and dented consumer confidence.
"China's infant formula industry is very scattered with only three companies having annual production capacity of 30,000 tons among a total of 127 infant formula companies," Gao Fu, of the consumer goods division at the Ministry of Industry and Information Technology, said at an industry forum last month. He said China was aiming to create 10 large companies within two years, each with annual revenue of more than 2 billion yuan (US$326 million).
He said domestic companies accounted for just 20 to 25 percent of high-end infant milk powder.
Last week, Hong Kong-listed Chinese baby-care products provider Biostime International Holdings Ltd said one of its units was under investigation for alleged anti-monopoly law violations.
It was in relation to an alleged violation by one of its wholly owned units, Biostime Guangzhou, the company said. It is alleged it was manipulating its distributors' and retailers' prices, the company said.
Earlier this year, liquor makers Kweichow Moutai and Wuliangye Yibin Company Ltd were fined a total of 449 million yuan (US$71.3 million) by the NDRC for price fixing.
The five companies are Nestle SA, Abbott Laboratories, Mead Johnson Nutrition Co, Danone's Dumex brand and Wyeth Nutrition.
The People's Daily, citing an unidentified source close to the National Development and Reform Commission's anti-monopoly division, said there was evidence that the price of milk powder sold by these companies had risen by about 30 percent since 2008.
Calls to the NDRC were unanswered yesterday afternoon, and there was no information about the investigation on its official website.
Nestle, Mead Johnson and Wyeth said they were cooperating with the investigation, according to Reuters.
Abbott refused to comment and Dumex couldn't be reached.
The investigation comes as China is making efforts to revitalize and consolidate the domestic milk formula industry after a series of food safety crises, including the melamine-tainted milk scandal of 2008, damaged the industry's reputation and dented consumer confidence.
"China's infant formula industry is very scattered with only three companies having annual production capacity of 30,000 tons among a total of 127 infant formula companies," Gao Fu, of the consumer goods division at the Ministry of Industry and Information Technology, said at an industry forum last month. He said China was aiming to create 10 large companies within two years, each with annual revenue of more than 2 billion yuan (US$326 million).
He said domestic companies accounted for just 20 to 25 percent of high-end infant milk powder.
Last week, Hong Kong-listed Chinese baby-care products provider Biostime International Holdings Ltd said one of its units was under investigation for alleged anti-monopoly law violations.
It was in relation to an alleged violation by one of its wholly owned units, Biostime Guangzhou, the company said. It is alleged it was manipulating its distributors' and retailers' prices, the company said.
Earlier this year, liquor makers Kweichow Moutai and Wuliangye Yibin Company Ltd were fined a total of 449 million yuan (US$71.3 million) by the NDRC for price fixing.
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