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Wal-Mart Underfire Over Food Labelling

BritCham / CBBC
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Authorities in Chongqing have ordered Wal-Mart stories to close in light of allegations of fraudulent labeling.

10 of the US retail giant’s stores and two Wal-Mart owned Trust Mart stores were closed on Sunday for 15 days while authorities investigate accusations that the company has been labeling ordinary pork as more expensive organic pork in one of China’s largest cities.

Since entering the Chongqing area in 2006 the retailer has been punished 21 times for other violations such as false advertising, mislabeling, and food safety and currently faces fines of 3.65 million Yuan over the mislabeling of pork over a two year period.

Similarly, in February of this year China's National Development and Reform Commission, the country's top economic-policy body, fined Wal-Mart and French retailer Carrefour SA a combined 9.5 million yuan ($1.4 million) for deceptive pricing

The sudden clamping down on foreign retailers by the authorities is thought to link to the larger sensitive issue of rising food prices, particularly pork which surged a record 52.3% in August.

China is a key market for Wal-Mart, which has seen revenue climb around 38% percent in the past decade as Chinese customers spend more on groceries and household goods.  

Source: Wall Street Journal

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