One of Australia's largest dairy processors, Lactalis Australia, has been penalised by the Australian Competition and Consumer Commission (ACCC) for allegedly misleading consumers by marketing two milk products as "fresh" when they contained substantial amounts of powdered, reconstituted ingredients. The company has paid $59,400 after the ACCC issued three infringement notices under the Australian Consumer Law.

The action relates to two products sold by Lactalis: Golden North Country Fresh 2L milk and Ferguson Valley WA Dairy Fresh 2L milk. According to the ACCC, laboratory investigations found that both products contained significant quantities of reconstituted ingredients, including skim milk powder and lactose, despite being prominently labelled as "fresh" milk. The watchdog alleges that such labelling could mislead shoppers into believing the milk was largely in its natural state rather than being partially reconstructed from powdered ingredients.

ACCC Deputy Chair Mick Keogh said consumers generally understand that fresh milk undergoes standard processing such as pasteurisation, homogenisation and adjustments to butterfat levels. However, he said most people would not expect milk described as "fresh" to contain substantial amounts of powdered, reconstituted ingredients. The regulator argued that consumers rely on accurate packaging when making everyday grocery purchases and should be able to trust that product descriptions reflect what they are buying.

The products were identified during a broader ACCC investigation into Australia's milk processing industry. The review examined information from several major dairy processors and retailers to assess whether fresh milk products were being accurately described. The ACCC said the investigation found that the vast majority of processors and retailers were correctly labelling their fresh milk products, making the Lactalis case an exception rather than an industry-wide problem.

Following discussions with the regulator, Lactalis removed the word "fresh" from the labels of both affected products. The company also paid the infringement notice penalties, although payment of an infringement notice is not an admission of liability under Australian law. The ACCC noted that infringement notices are issued where it has reasonable grounds to believe consumer laws may have been breached.

The ACCC said the case sends a clear message to food manufacturers about the importance of truthful product descriptions. Mr Keogh warned that all food processors are on notice that misleading claims about packaging and labelling may attract regulatory action. He said accurate labelling is especially important for staple grocery products that consumers purchase regularly and often without closely examining ingredient lists.

Lactalis Australia is one of the country's largest dairy processors, producing products under brands including Pauls, Harvey Fresh, Oak, Vaalia and Ice Break. The company was also previously penalised by the Federal Court for breaches of the Dairy Code of Conduct relating to milk supply agreements. The ABC reported that it sought comment from Lactalis regarding the latest ACCC action.