However, Harbour Street Bakery's Ed Balsink said yesterday gluten found in the loaf was an accident, when the wrong flour was used, and he had stopped producing the loaf because there is "no 100% guarantee" it can be gluten-free.
It no longer makes the loaf nor gluten-free products, because of that, he said.
The bakery used to make about 20 gluten-free loaves a week, but stopped the product about seven months ago, as soon as the Commerce Commission found they contained gluten.
Earlier this year, the Commerce Commission visited the Harbour Street Bakery and bought three loaves of bread from three batches described as "gluten-free" on signs and the bakery's website.
Testing can detect any gluten more than 3ppm (parts per million), which would have breached the gluten-free claim under the provisions of the Fair Trading Act. Initial testing found gluten of more than 50ppm and further testing in the region of 1000ppm.
The manager of the Christchurch competition-fair trading branch, Stuart Wallace said gluten was harmful to people with coeliac disease, as the only effective treatment was complete gluten avoidance.
Mr Balsink told the commission he was uncertain how the gluten got into the loaves, suggesting there may have been a residue from equipment and bread slicer. He also suggested a baker may have added gluten by mistake.
Mr Balsink, when contacted by the Otago Daily Times, said about 99% of the bakery's products were made from wheat flour, which made it hard to maintain a gluten-free environment.
If prosecuted, the bakery could have been fined up to $200,000 and individuals up to $60,000.
However, the commission had decided to issue a warning letter, advise media and take no further action.
