French Prosecutors Investigate Nestlé, Danone Over Contaminated Baby Formula

Paris - French prosecutors have opened investigations into several major dairy companies, including Nestlé and Danone, following widespread recalls of baby formula linked to possible contamination by a harmful toxin.

The Paris public prosecutor confirmed Friday that five companies are under investigation over infant nutrition products that may have been contaminated with cereulide, a heat-stable toxin capable of causing nausea, vomiting and diarrhoea. In severe cases, complications can arise, particularly in vulnerable infants.

The probe includes multinational food groups Nestlé, Danone and privately held Lactalis, along with smaller brands Babybio and La Marque en Moins. Authorities said the investigation concerns potential “deception regarding goods posing a danger to human health,” an offence that carries penalties of up to seven years in prison and fines of up to €3.75 million if proven.

Nationwide Complaints Prompt Legal Action

The prosecutor’s office said the investigation was launched following a significant number of complaints across France. Meanwhile, the French health ministry is reviewing three reported infant deaths in cases where consumption of recalled formula was noted. Officials stated that no direct causal link has yet been established, and judicial inquiries remain ongoing.

The crisis began in December after Nestlé identified traces of cereulide in certain finished products at a factory in the Netherlands. The company informed Dutch authorities, the European Commission and affected countries on December 10 and initiated precautionary recalls covering 25 products across 16 European nations.

By January, recalls had expanded significantly, affecting brands such as SMA, Beba and Little Steps. French manufacturers Danone, maker of Aptamil and Cow & Gate, and Lactalis subsequently announced their own recalls. To date, more than 60 countries have reported affected products.

Source of Contamination Identified

Nestlé said the contamination was traced to a supplier of arachidonic acid (ARA) oil, a commonly added ingredient in infant formula. Both Nestlé and Danone have discontinued use of the supplier. However, the supplier’s identity has not been publicly disclosed.

European regulators have since taken steps to address gaps in oversight. On February 2, the European Food Safety Authority introduced a threshold level for cereulide, marking the first harmonised standard for the toxin within the bloc.

In the United Kingdom, authorities reported at least 36 cases of infants presenting symptoms consistent with cereulide exposure, heightening public concern.

Financial Impact in Focus

The unfolding crisis has drawn attention from investors ahead of upcoming earnings reports from Nestlé and Danone.

Infant nutrition accounts for roughly 5 percent of Nestlé’s total revenue, with the company stating that recalled products represent about 0.5 percent of sales. Analysts caution, however, that reputational risk may extend beyond the immediate financial impact.

For Danone, infant formula is more significant, representing an estimated 21 percent of group revenue and a larger share of operating profit.

Both companies are expected to address the recalls and their financial implications in earnings announcements later this week.

Ongoing Scrutiny

The investigation marks the latest development in what has become a rapidly escalating public health and corporate governance issue. While companies have described their actions as precautionary and emphasised consumer safety, regulators are examining whether adequate safeguards were in place.

As inquiries continue, parents, healthcare authorities and investors alike await further clarity on the scope of the contamination and its long-term implications for Europe’s infant nutrition industry.