China fines infant formula firms £71m over price-fixing charges

 
Suzie Neuwirth
CHINESE authorities yesterday issued fines totalling 670m yuan (£71m) on six global producers of infant formula following a probe into price fixing, according to state media.

The six companies are Biostime, Mead Johnson, Dumex, Abbott, Friesland and Fonterra.

The National Development and Reform Commission (NDRC) says that the firms set minimum resale prices for distributors or ended contracts with distributors who sold their products at lower prices, restricting competition and keeping prices high.

Foreign brands of infant formula are very popular in China after a 2008 scandal in which six infants died and thousands were made ill from locally-produced tainted formula.

Analysts say the antitrust probe could be part of a Chinese plan to boost the local infant milk market.

US firm Mead Johnson – which produces Enfamil – said it has been fined around £21m.

“China remains one of the company’s most important markets,” said chief executive Peter Kasper Jakobsen.