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24 January 2020 / article

The first Dutch turnover-related fine in food has been imposed

On 23 January 2020 the Dutch Food Safety Authority (NVWA) has crossed the Rubicon and imposed the first turnover related fine in the history of Dutch food law. A company that violated recall obligations and even sabotaged the instructions of the NVWA to other market parties has the dubious honour.

The exemptions for SME employers or Belgian entrepreneurs and individuals on withholding tax

At least 19 cases of sickness from contaminated meat

In 2018 at least 19 people got sick from eating pig meat contaminated with Salmonella Goldcoast due to incorrect processing. The meat products made it to major supermarkets and caused several cases of sickness. The NVWA was alarmed by significantly more complaints linked to salmonella than usual. Through inter alia DNA-tracing the slaughterhouse could be identified by the NVWA.

The NVWA then proceeded to instruct the slaughterhouse to perform a recall procedure and notified customers of the relevant slaughterhouse. However, the slaughterhouse was uncooperative and refused to take the measures the NVWA instructed. The slaughterhouse even went as far as to tell its customers to ignore the instructions of the NVWA!

Fined for 1% of the annual turnover

Since July 2016 the NVWA has the possibility to impose turnover related fines for certain serious violations (of up to 1% of the annual turnover of companies with an annual turnover of more than EUR 10 million). Up to 2020 no turnover related fines have been imposed. However as in the matter at hand the slaughterhouse acted intentionally and the violation was a sufficient threat to public health, a turnover related fine of EUR 0,5 million was imposed (1% out of a EUR 50 million turnover).

As this is the first turnover related fine, the question is whether this is a ‘black swan’ or the beginning of a trend. My guess would be the latter, as on 14 December 2019 the Official Controls Regulations (EU/2017/625) entered into effect (almost) entirely. This Regulations prescribed harsher penalties by competent authorities like the NVWA. In the food and beverages sector where profit margins are thin, a fine of 1% of the turnover can have a big impact.

Want to know more or discuss about this topic? Please contact our Food & Beverages Team.

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