New front in Danone's Spanish yoghurt war

Danone, the French dairy group, has opened a new front in its long-running legal battle with Spain's Leche Pascual, shrugging off its defeat on another front earlier this year.

Danone has been trying to prevent its rival from calling its long-life dairy desserts by the name 'yoghurts', claiming that such terminology was both misleading to the consumers and detrimental to producers of 'true' yoghurts, such as itself.

However, in June this year the Spanish authorities gave the go-ahead to Leche Pascual to use this terminology, prompting Danone to look for a different method of fighting its rival.

This time, according to a report in Spain's Expansion​ newspaper, the French company has blocked Pascual's attempts to register itself as a yoghurt producer with Fenil, the Spanish dairy industry association.

Fenil divides the dairy sector into four markets - liquid milk, cheese, butter and yoghurts. At present, Leche Pascual is registered as a liquid milk producer, while Danone is a yoghurt maker, but following the decision allowing Pascual to call its dairy desserts yoghurts, the company has sought to register with Fenil as yoghurt maker too.

However, Danone has effectively blocked Pascual's attempt to register as a yoghurt producer by putting forward a proposal to Fenil that the statutes be changed - from now on, only producers of fresh yoghurt (and not pasteurized long-life products such as those called yoghurts by Pascual) can register as members of the association.

Danone's case was clearly helped by the fact that the president of the Association of Yoghurt Makers - the sub-divison of Fenil - is Joaquin Fernandez, who just happens to work for Danone. He told Expansion​ that Pascual had achieved its goal in getting permission to call its long-life products yoghurts, and that Danone was simply defending its interests by putting forward the proposed change to the statues. "Although they can now call their desserts yoghurts, it is clear that they are not the same product. Ours contain live bacteria, while theirs do not."​

Not surprisingly, Pascual was disappointed by the decision to exclude it from the yoghurt makers' association. "Danone's sole preoccupation is to close as many doors as it can to us and they do not seem to realise that their actions could be said to be anti-competitive",​ the company told the paper.

Leche Pascual sees its fight not only with Danone, but with all the other major multinational dairy groups which are active in Spain - such as Nestle and Parmalat - and sees itself as the defender of Spanish dairy interests.