New Zealand's Fonterra fined $255,000 over botulism scare

A woman uses her mobile phone in front of an advertisement for Fonterra in Jinan, East Chinas Shandong province, August 12, 2013. [Photo/icpress.cn]

WELLINGTON -- New Zealand dairy giant Fonterra was fined NZ$300,000 ($255,000) on Friday for food safety breaches relating to last year's botulism scare.

The New Zealand dairy giant pleaded guilty in the Wellington District Court on Friday for not meeting standards set down in the Animal Products Act.

The company had pleaded guilty to four charges laid by the Ministry for Primary Industries last month that it failed to meet food processing standards.

Judge Peter Hobbs said he took into account Fonterra's early guilty plea and that it had taken steps to address the problems. He fined it NZ$120,000 NZ for one charge and NZ$60,000 for the other counts.

Judge Hobbs said Fonterra's offending had been a result of carelessness, rather than a deliberate act.

He said there was a need to hold Fonterra to account for the impact the scare had on New Zealand's reputation as a safe food exporter. He added that the food safety crisis left New Zealand's reputation as a high quality food exporter shaken and it had a downstream impact on dairy producers.

It was feared 42 tones of whey protein concentrate a key ingredient in infant formula had been contaminated with a botulism-causing bacteria, prompting a global recall of some dairy products.

But further testing confirmed the bacteria found didn't present a health risk and the scare was a false alarm.

In a statement, Fonterra's managing director of people, culture and strategy Maury Leyland confirmed the company wouldn't challenge the fine imposed.

"Fonterra had already accepted responsibility for the allegations made in the charges, and we respect the sentencing decision made," she said.

French food giant Danone, which made infant formula from the whey protein, is suing Fonterra for losses, claiming the botulism scare cost it more than $NZ570 million.

Federated Farmers Dairy Chairperson Willy Leferink believed the $NZ300,000 fine is proportionate.

"As supplier shareholders and unit holders will ultimately meet the cost of the fine, we are certain Fonterra's management has got the message loud and clear," said Leferink on Friday.

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