Norwegian seafood company sold salmon that should have been destroyed

Pure Norwegian Seafood (PNS), a company majority-owned by salmon farmer Måsøval, has been selling fish it shouldn’t have done, Måsøval said in a stock market announcement yesterday.

Måsøval has been a supplier of PNS, a slaughter and sales company on Averøy, and has owned 65% of the company since June 2021.

The fish farmer revealed yesterday that it first suspected irregularities at PNS on October 20 last year.

“Via Måsøval’s board representatives in PNS, action was immediately taken through board instructions to completely stop the irregular activity, cold storage was sealed and affected products recalled.

“Organisational measures were taken within a short time, and new and reinforced routines were introduced at PNS. (Accountancy firm) EY was then engaged to carry out an independent and thorough investigation.

“The Norwegian Food Safety Authority was notified at the beginning of November and dialogue with the safety inspection has been maintained during the investigation. The investigation has now been completed and the results have been handed over to the Norwegian Food Safety Authority for their possible further investigations.”

Discards and production fish

In short, the investigation shows that over several years PNS has allowed certain customers to buy frozen salmon which, according to Norwegian regulations, is not suitable for human consumption, including fish which according to Norwegian regulations should have been ensiled/destroyed (discarded fish) or should have been redirected before export (production fish).

The investigation estimates that this turnover of fish, which according to the regulations is not suitable for human consumption, amounted to just under 1% of the total volume of fish and about 0.5% of the income of PNS in the last three years.

Måsøval stated that, as a supplier to PNS, it has not made any profit or shared in other profits related to these activities in PNS. The above activities were stopped in October 2023.

'Serious and disappointing'

After investigation and other investigations, no indications have so far been received that the irregularly traded products have affected people’s health.

As Måsøval assesses the consequences beyond this, tit will primarily be linked to any public sanctions that could affect PNS.

“For Måsøval, this is a serious and disappointing matter, both as a shareholder and supplier. Måsøval and PNS will first prioritise dialogue with and facilitation of the authorities’ further investigations, but Måsøval will then also assess its own private law rights regarding contractual and possibly compensation matters,” stated the fish farmer.

“At the same time, it is important for Måsøval, as the responsible owner, to look after PNS, its customers and not least the employees as best as possible in this difficult situation. Despite the scrutiny, the organisational changes and new routines and requirements, the production staff at PNS have delivered every single day.”

Two people suspended

In a separate press release, PNS chairman and Måsøval chief executive Helge Kvalvik said that this is a very serious matter that quality and credibility are absolutely crucial for the entire industry.

“The investigation is not a verdict or a final conclusion, but documents conditions that are both surprising and disappointing. A big job has been done in cleaning up, which we are continuing with now,” said Kvalvik.

According to the company, two people in the company were suspended. At the beginning of November, EY was engaged to carry out an investigation, where preliminary conclusions and findings are now available.

“In our opinion, the most serious thing is that the investigation reveals the systematic and hidden sale of salmon that should not have been used for human consumption. Certain customers have, on request, been allowed to buy frozen salmon that has died by itself, is injured, sexually mature or so-called floor fish,” said Kvalvik.

He said that production fish had also been exported.

“It is not illegal to convert it for human consumption, but according to the regulations it must be processed and corrected in Norway before export. It is serious that such salmon have been exported without it having happened,” said Kvalvik.

Serious findings:

The Norwegian Food Safety Authority was notified of the case in early November. PNS has had a dialogue with the supervisory authority throughout the investigation. The suspicion has not been made public earlier due to the investigation. The authorities have been informed of the main findings. The following conditions from the preliminary findings of the investigation appear to the board to be serious:

• The investigation shows that PNS has sold frozen salmon which according to Norwegian regulations is not suitable for human consumption. According to the findings, this includes, among other things, fish that died before slaughter, floor fish and sexually mature fish. The sale of these categories of fish is illegal.
• According to the investigation, the sale has taken place to a limited number of customers, especially in Eastern Europe. The findings of the investigation indicate that the customers knew what they were buying and particularly wanted salmon in these categories.
• The investigation points to around 20 possible customers in European countries, including Norway. It has not been possible to determine where the final products have ended up.
• According to the findings of the investigation, the sale has been going on for several years. The investigation estimates that salmon, which according to Norwegian legislation is not suitable for human consumption, accounted for just under 1% of the total volume of fish in PNS between 2020 and 2023. This amounts to around 500 tonnes.
• The investigation shows that PNS has also sold production fish abroad, without first having processed it domestically in accordance with the regulations. It is not illegal to sell these fish for human consumption, but they have external damage that must be rectified in Norway before export. The investigation indicates that between 300 and 400 tonnes of production fish have been exported in total over the past four years.
• Independent experts commissioned by PNS have thawed frozen salmon of the types sold from the warehouse and examined them. None of the samples tested positive for Salmonella. The proportion of samples with Listeria monocytogenes was somewhat higher than is expected to be found naturally. Listeria bacteria were not detected in muscle samples, but only on the outside of the fish.

'Never again'

After the investigation and other investigations, we have no indications that anyone’s health has been affected by this frozen salmon. It is important, even if it does not make the failures in the case any less serious,” said Kvalvik.  "This activity has been kept hidden. Neither the board of PNS, Måsøval as a supplier or the auditor have discovered it before. There have been inspections and checks by the authorities in recent years, without it being possible to uncover the activities. We must learn as much as possible from this case,” he added.

Remy Strømskag has been acting general manager of PNS since the end of October 2023.

“These have been tough months for everyone who works in PNS. We and our people are rightly known and recognised for the high quality of the products we export. It is hard to admit that the company has exported frozen salmon that does not live up to it. This should have been notified and taken care of before. Now we are working together to ensure that something like this can never happen again,” said Strømskag.