Indian govt seeks $100mn damages over unsafe Maggi noodles

12 Aug 2015
Financial Nigeria

Summary

Test results showed the instant noodles contain "unsafe and hazardous" amounts of lead.

Maggi Noodles

The Indian government has sued Nestle and is seeking damages of nearly US$100 million from the multinational food and beverage company for what the Indian food safety watchdog calls “unfair trade practices.”

In a statement on Wednesday, the Food Safety and Standards Authority of India (FSSAI) said it filed the lawsuit with National Consumer Disputes Redressal Commission (NCDRC), which has semi-judicial powers, seeking 6,400 million rupees ($98.6m) in damages.

The food regulatory agency had previously banned the popular snack in India accusing Nestle of misleading its Indian consumers and constituting health risks to the populace.  

In laboratory tests ordered by FSSAI in April, the test results showed the instant noodles contain "unsafe and hazardous" amounts of lead. The test results also indicated the presence of a flavour enhancer chemical, monosodium glutamate, or MSG. Unfortunately, Nestle does not mention this chemical in Maggi noodles' list of ingredients.

Nestle has filed a suit at the Bombay high court challenging the ban. It claims its products are safe. It says test results on its noodles in other countries, including the US, Britain and Singapore confirm this.

The court has asked for samples of Maggi noodles to be re-tested but FSSAI has objected to the retesting. The lawyer for the food regulator told the Indian Express newspaper that, "There is no provision for such a testing according to the law; we will not follow a different procedure because of Nestle."

Two separate Indian laboratories also recently declared the noodles to be safe. However, FSSAI has repudiated the findings and doubted the reliability of the tests.

The product is Nestle's fastest-selling food item in India, accounting for 80% of India's instant noodles market or about 15 billion rupees ($240m) in annual sales. Nestle says it has already destroyed 400m tonnes of Maggi products since the ban was enforced.

A spokesperson for Nestle India said on Wednesday the company had yet to receive any official notice on the complaint filed with NCDRC.


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