The Indian food regulator FSSAI warned the alcohol giant Diageo that the company is misleading consumers by claiming that one of its most popular types of whiskey is 'aged in American oak barrels,' when much of the product did not undergo the aging process. This is evidenced by a confidential government notification.
A previously undisclosed notification dated July 20 from the Food Safety and Standards Authority of India (FSSAI), analyzed by Reuters, reveals another regulatory complaint besides claims of incorrect flavoring, which led to the ban on the sale of some alcoholic beverages this month.
On Sunday, FSSAI announced a ban on Diageo's Royal Challenge whiskey produced in Madhya Pradesh, as well as certain brands of whiskey and rum produced by Diageo and Inbrew in various Indian states, due to the use of artificial flavorings, such as whiskey and rum flavorings, instead of proper aging and ingredients.
The industry claims compliance with the law. However, in its July 20 notification, FSSAI informed Diageo that the whiskey label states it is 'aged in American oak barrels,' but simultaneously, 'your product contains grain neutral spirit as the second ingredient after demineralized water, and most of it is unaged spirit.'
The regulator emphasized: 'The full alcohol is not aged in a wooden barrel as stated on the label, and therefore misleads the consumer. Any claim regarding the age of the spirit used in the product must refer to the youngest spirit used in the blend, not the oldest.'
United Spirits informed stock exchanges this week that it expects the ban not to have financial consequences, but the company is closely monitoring the situation.
The whiskey ban applies to Diageo's Antiquity Blue Whisky and Royal Challenge produced in Madhya Pradesh, as well as Inbrew's Bagpiper Deluxe Whisky and Old Cask Deluxe XXX Rum produced in the same state.
Royal Challenge, produced domestically, is one of Diageo's best-selling products in India. According to Diageo, over 4.5 million nine-liter cases of Royal Challenge are sold annually in India, and the company classifies it in the 'mid-premium' segment.
Alcohol prices vary in each Indian state, but in Uttar Pradesh, a 375 ml bottle of Royal Challenge costs 360 Indian rupees ($3.80 USD).
The front label of the whiskey states: 'A rich blend of Indian grain spirit and imported scotches, aged in American oak barrels.' The back states that it contains 'demineralized water, grain neutral spirit, scotch. Contains approved natural coloring... and naturally identical (whiskey) flavorings.' Furthermore, the FSSAI notification noted that Diageo's mention of 'Scotch' is also vague and 'does not specify its true characteristics,' requiring the company to specify exactly which 'Scotch' is used.
