Sales of bottled water are slipping across North American and Europe, giant food company Nestlé Waters reported Thursday.

Water sales for the company, part of the Nestlé conglomerate, fell 1.6 per cent in 2008, the parent company reported. Profit margins in the bottled water business also fell.

The company, which says it is the leading bottled water company in the world with 72 brands, linked the sales drop to "the continued slowdown of the bottled water category," while the profit margin fell because of higher costs for plastic and distribution.

But for the anti-bottled-water activists at the Polaris Institute, the drop is proof that their "Inside the Bottle" campaign is working. The institute says its campaign highlights the environmental, health, social and economic impacts of bottled water and calls for the rebuilding and maintenance of public tap water systems.

The Nestlé Waters result shows that consumers are rejecting bottled water, Richard Girard, Polaris research co-ordinator, said in a news release.

"Across the country municipalities, universities, churches, restaurants and unions are kicking out the bottled and turning on the tap."

According to Polaris:

• Twenty-four municipalities have restricted sales of bottled water.
• More than 40 municipalities are looking into the idea.
• The Association of Municipalities of Ontario recently encouraged members to contact municipalities that have taken action against bottled water.
• Twenty-one university and college campuses have established "bottled-water-free" zones.

But Saint John, N.B., city council last fall defeated a proposal to ban bottled water sales from municipal buildings.