Walmart Faces Sanctions In China
October 10, 2011 by UPI - United Press International, Inc.
CHONGQING, China, Oct. 10 (UPI) — Chinese authorities said they have temporarily closed 12 stores owned by U.S. retail giant Walmart for allegedly mislabeling pork as organic.
The issue involves 10 Walmart and two Trust Mart stores in Chongqing, a city in southwestern China that says on its Web site it has cited the company 21 times since it opened its first store in the city in 2006, The Wall Street Journal reported Monday.
The stores has been cited for false advertising, food safety and pricing errors. The latest sanctions include closing the stores for 15 days and possible fines of $575,000.
Walmart and French retailer Carrefour SA were fined $1.4 million earlier this year for fraudulent pricing.
Recently, the issue of rising food prices has been particularly sensitive. Top government officials have turned their attention to inflation, which has given rise to speculation that Regional Communist Party Secretary Bo Xilai is using the sanctions to help secure a coveted position in the national Politburo Standing Committee that will become available next year.
The price of pork was up 52 percent in China on an annual basis as of August. Organic pork, the Journal said, is more expensive than non-organic, which could give the store incentive to mislabeling the product.