FSSAI initiates legal action against Nestle India on baby formula, shares fall 2%

As per the latest business developments, Food Safety and Standards Authority of India (FSSAI) has initiated legal against Nestle India over several non-compliances pertaining to the FSS Act following which the FMCG major's shares declined over 2% on September 18. FSSAI filed three adjudication cases against Nestle India over three products.

Products on which legal action are being taken are for Infant Nutrition, NAN Excella and Lactogen.

Sample of follow-up formula manufacturing by Nestlé India was found sub-standard during lab analysis.

A sample of the follow-up formula was found below the required Biotin level. A second lab test additionally found the sample did not meet the prescribed Biotin requirement.

FSSAI stated the action is part of its food-safety enforcement efforts.

FSSAI stated it has examined the mentioned infant nutrition products and their promotional material available on e-commerce platforms.

"In NAN Excella Pro Stage 1, claims relating to "5 HMOs" and "Whey Protein" were observed, while in Lactogen Pro 1, a claim relating to "Whey Protein" being easy to digest was observed. Accordingly, clarifications were sought from M/s Nestlé India Limited regarding the above claims. Both products were found to be in contravention of Regulation 4(2) of the FSS (Foods for Infant Nutrition) Regulations, 2020, which restricts promotional claims/material intended to gain the saleability of infant foods, and Section 3 of the IMS Act, 1992, which prohibits their advertisement and promotion," stated FSSAI in a statement.

Separately, a sample of a follow-up formula manufactured by Nestle India was found sub-standard for Biotin content during laboratory analysis. The sample was sent for re-analysis, and the referral laboratory additionally found it non-conforming with the Biotin requirement prescribed under the 2020 regulations.

In light of these findings, FSSAI has filed three separate adjudication cases against Nestle India in respect of the three products, it further noted.

At 1:30 pm on September 18, Nestle India shares were trading 2.3% softer at Rs 1.336 apiece.