Amway Loses Major Farm and Pays fine

In the world of Multi-Level Marketing (MLM), transparency and “seed-to-supplement” traceability are the gold standards of marketing. For Amway, the world’s largest MLM, that narrative recently hit a significant legal and ethical roadblock.

In late 2025, a landmark international arbitration case concluded with a decisive loss for Amway (operating through its subsidiary Access Business Group) regarding its Nutrilite farm operations in Jalisco, Mexico. This ruling not only carries a financial penalty but raises serious questions about the future of one of the company’s most vital supply chain assets.

The Dispute: Rancho El Petacal

For decades, Amway’s Rancho El Petacal in Jalisco has been a crown jewel of the Nutrilite brand. The company used this 284-hectare farm to grow organic alfalfa, chia, and spinach, marketing the “purity” of these ingredients to millions of Independent Business Owners (IBOs) worldwide.

However, the land’s history is fraught. In 2022, the Mexican government (SEDATU) ruled that the land actually belonged to the San Isidro ejido, a local community of farmers whose ancestors were granted the land by presidential decree back in 1939.

Amway fought this tooth and nail, filing a massive $2.7 billion (USD) lawsuit against the Mexican state under the legacy provisions of NAFTA/USMCA. They claimed the land seizure was an illegal expropriation of their private property.

The Ruling: A Total Loss

On November 21, 2025, the International Centre for Settlement of Investment Disputes (ICSID) issued its final ruling:

Jurisdiction Denied: The tribunal dismissed Amway’s $2.7 billion claim entirely, ruling that the company could not use “legacy” trade protections for events occurring years after NAFTA was terminated.
Financial Fine: Far from receiving billions, Amway was ordered to pay approximately $1.3 million (USD) to the Mexican government to cover legal fees and administrative costs of the arbitration.
Land Restitution: The ruling solidified the return of the land to the San Isidro community, ending a legal battle that has spanned generations.

Ramifications for the Supply Chain

This loss is more than just a line item on a balance sheet; it hits the core of Amway’s “Traceability” marketing campaign.

Production Shortfalls: Losing nearly 300 hectares of prime organic farmland disrupts the production of core Nutrilite ingredients. While Amway owns other farms (in Brazil and the US), the specific climate and yield of El Petacal cannot be replaced overnight.
Traceability Gaps: Amway has long promised customers they can track a supplement back to the specific plot of land where it was grown. With the loss of this farm, the company may be forced to source “certified organic” ingredients from third-party suppliers, which dilutes their unique selling proposition of owning the entire process.
Environmental & Social Backlash: During the trial, the local community accused the company of blocking water access and causing environmental damage. For a company that markets “wellness” and “ethics,” these allegations are a significant PR hurdle for IBOs trying to recruit new members.

Business Impact: The “Nutrilite” Silver Lining

Despite the legal defeat, Amway remains a financial behemoth. Recent 2025 revenue reports show that while the overall MLM model is seeing a slight decline, Nutrilite sales are actually growing, now representing roughly 64% of total global sales.

For IBOs, this means the brand is still strong, but the “story” is changing. You can no longer point to the Jalisco farm as a guaranteed source for your supplements. The company will likely need to pivot its marketing to focus on its “Nutrilite Certified” partner farms rather than company-owned land.

Key Takeaways for MLM News Audience:

The Fine: $1.3 Million (plus millions in their own legal fees).
The Loss: 284 hectares of prime Jalisco farmland returned to local farmers.
The Message: Supply chain sovereignty is difficult to maintain in foreign markets, and the “seed-to-supplement” promise just got a lot harder to keep.