SAO PAULO (Reuters) - A consumer protection agency in Brazil has taken aim at the Happy Meal, fining McDonald’s Corp (MCD.N) on Monday for targeting children with its advertising and toys.
The Procon agency in the state of Sao Paulo fined the fast-food company 3.2 million reais ($1.6 million), adding fuel to a global debate about fast food and public health.
As with the case in Brazil, Latin America’s biggest economy, much of the debate centers on how McDonald’s and other fast-food companies market to children and other young consumers.
While the initial fine may have little impact on the world’s largest restaurant chain, the agency said additional citations for similar advertising could arise, more than doubling the cost to McDonald‘s. Consumer agencies in other jurisdictions could also soon follow the precedent in Brazil’s most populous state.
“This is not an isolated case,” said Procon’s top lawyer in Sao Paulo, Renan Ferraciolli. “There’s no need to appeal as they do to children without the maturity or the rationality to enter the market as consumers.”
The fine, announced on Monday, stemmed from a 2010 campaign offering meals with toys from the motion picture Avatar and a local television series, Ferraciolli said. Other marketing activity since then has followed similar patterns, he added, giving the agency grounds to consider additional fines.
A spokeswoman for McDonald’s declined to comment on the case. The company can appeal Procon’s ruling in court.
The penalty in the fast-growing Brazilian market is the latest in a series of increasingly aggressive tactics by local regulators, who recently have cracked down on big companies for perceived consumer abuses. In recent months, various Brazilian agencies have penalized banks, phone companies and private health plans in the name of consumer protection.
In the United States, pediatricians have urged a ban on advertising unhealthy foods to children, but legal measures have gained little traction. A judge there last year threw out a lawsuit against Happy Meal marketing.
U.S. regulators have urged companies to voluntarily end food advertising to children unless they are promoting healthy fare, but industry groups have fought fiercely against such proposals.
In a nod to concerns from public health advocates, McDonald’s in recent years added apples and reduced the amount of french fries in its children’s Happy Meals, which continue to include a free toy. The chain also moved to start listing calorie information on menus throughout the United States ahead of a national rule requiring such disclosures.
($1 = 2.02 Brazilian reais)
Reporting by Brad Haynes; Additional reporting by Lisa Baertlein in Los Angeles; Editing by Bernard Orr