Nestle and its rival, Danone, responded to Beijing's investigations in the sector for possible price-fixing activities as well as anti-competitive behaviors by deciding to reduce prices of their infant milk products.

Nestle's Wyeth Nutrition had earlier claimed that it was already cooperating with the probe carried out by China's National Development and Reform Commission (NDRC) by reducing the prices of its products and improving its selling and marketing practices. Price cuts are effective starting July 8.

In an email to Reuters, Danone also proclaimed its cooperation and plans to reduce prices. Aside from these food giants, two more companies, Mead Johnson Nutrition Co as well as Abbott Laboratories announced that they were also under investigation.

Investigations reflect China's determination to resolve persistent food safety problems such as pork laced with harmful chemicals and milk contaminated with substances that can trigger cancer.