Persil's new detergent, which will be available in the shops from next month, does not contain the controversial manganese catalyst, known as the accelerator, which was thought to be responsible for the damage.
Procter and Gamble, whose Ariel Ultra is the main competitor to Persil Power, pounced on this as an admission of defeat. It said yesterday: "With the launch of this alternative product, Lever Brothers appears to be acknowledging a problem with the accelerator ingredient at any level.
"The Procter and Gamble position has consistently been that products on the shelves at the moment with the manganese catalyst continue to cause unacceptable fabric damage."
Lever Brothers said that it was launching the new product because adverse publicity in the UK had held back the growth of Persil Power. The company now sees it as a product for stain removal.
According to Nielsen market research, Persil Power's market share is just 2.3 per cent, around half its level before the "rotting clothes" rumpus broke out. Ariel Ultra claims a market share of around 6 per cent.
New Generation is being marketed as an everyday-use powder and will be backed by a £19m advertising campaign. The company said it had undertaken extensive testing and the detergent had performed well on 140 stains and not rotted anything.
Lever Brothers' own position was dramatically undermined by one of its senior directors in September when Unilever's co-chairman, Morris Tabaksblat, admitted that his company had launched a "defective" product.
Procter and Gamble is also launching a new detergent this month called Ariel Future. Like the new Persil product, it is a more concentrated detergent.