Dairy firms hit with fines

All dairy companies under investigation have admitted they violated the anti-monopoly law by setting minimum prices that distributors were required to charge, said Xu Kunlin, head of the price department of the NDRC.

The NDRC said in a statement that the fines were for restricting competition, setting curbs on minimum prices for distributors and for using a variety of methods to disrupt market order.

Among nine companies under investigation, six were fined because they didn't cooperate with the government investigation and failed to "actively take corrective action", Xu said.

Biostime was fined 163 million yuan, or 6 percent of its sales revenue in 2012. Mead Johnson was fined 204 million yuan, or 4 percent of its revenue last year.

The remaining four companies received fines equal to 3 percent of their 2012 revenue. Dumex was fined 172 million yuan, Abbott 77 million yuan, Friesland 48 million yuan and Fonterra 4 million yuan.

Three other companies, Wyeth Nutrition, a unit of Switzerland's Nestle SA, China's Beingmate and Japan's Meiji Dairies Corp, were spared fines because "they cooperated with the government investigation, provided important evidence and actively took corrective measures", according to Xu.

Mead Johnson, based in Glenview, Illinois, told China Daily in an e-mail that it accepted the punishment and will pay the fines.

"It will not affect our future strategy in China," the statement said. "We are proud of what we achieved in the past two decades and will continue to invest in the Chinese dairy market."

The company trimmed the price of its dairy products by 7 to 15 percent following the investigation.

Wyeth Nutrition also said in a statement that the company respects the NDRC's decision and will continue to implement price reductions.

The company said it has assessed its pricing practices and decided to improve certain sales and marketing practices.