Dairy Company Milkio Foods Penalized $420,000 for Misrepresentation of Product Origin

Milkio Foods Limited, a dairy company based in Hamilton, has been fined $420,000 for misleading customers about the origin of their ghee products.

The company falsely advertised its ghee as "100% Pure New Zealand" and claimed it was produced from "clean green pasture-based dairy farms in New Zealand," while in reality, the ghee contained butter imported from India.

Dairy Company Fined for Misleading Origin Claims

According to Otago Daily Times, the Commerce Commission brought the case against Milkio after receiving a referral from the Ministry for Primary Industries.

Milkio was charged with 15 breaches of the Fair Trading Act for making false representations about the source of its ingredients and for using the FernMark logo without proper authorization. The FernMark logo is a symbol that signifies a product's genuine New Zealand origin, intended to reassure consumers of its quality.

Judge Thomas Ingram, who oversaw the case, emphasized that the misleading claims could significantly harm the reputation of New Zealand's dairy industry. He noted that the damage extends beyond misleading consumers and affects other dairy producers who rely on New Zealand's brand reputation for their own products.

Judge Ingram criticized Milkio's actions as "deliberate ignorance" and described the company's behavior as a severe lapse in business ethics. He highlighted that the incorporation of the FernMark logo was meant to add an extra layer of trust for consumers but was misused by Milkio to falsely enhance its product's credibility.

Protecting New Zealand's Dairy Reputation

Vanessa Horne, the Fair Trading General Manager at the Commerce Commission, stressed the importance of this case. She noted that New Zealand's dairy industry is globally recognized for its high quality, and the country's reputation in the international market is crucial for its success. The case serves as a stark warning to other companies against making false claims about their products' origins.

Horne pointed out that Milkio's misleading packaging not only deceived customers but also undermined the hard-earned reputation of New Zealand's dairy exports. She emphasized that the conviction should act as a cautionary message for any company tempted to misrepresent their products.

Milkio Foods Limited admitted to the charges and has been penalized for its deceptive practices. The company's attempt to maintain authorization to use the FernMark logo with false information led to the massive fine, reflecting the serious nature of the violations.

This case highlights the ongoing efforts of regulatory bodies to protect consumers and maintain the integrity of New Zealand's export brands. The Commerce Commission remains committed to enforcing fair trading laws and ensuring that businesses provide accurate information about their products.

The sentencing took place at Hamilton District Court on Thursday, August 22, and the case has underscored the importance of honest marketing and the value of maintaining consumer trust in the dairy industry, the New Zealand Herald reported.