Wednesday, August 23, 2017

Colgate-Palmolive Pakistan fined of rupees 10 million for deceptive marketing by CCP

ISLAMABAD (PR) The Competition Commission of Pakistan (CCP) has passed an order imposing a penalty of PKR 10 million on Colgate-Palmolive Pakistan (Pvt) Ltd. for running a deceptive marketing campaign for one of its products, ‘Max All Purpose Cleaner’ (Max APC), in violation of Section 10 of the Competition Act, 2010.

CCP received a formal complaint from Reckitt Benckiser Pakistan Limited stating that the marketing campaign run by Colgate-Palmolive for its product Max APC was making deceptive/false claims i.e., ‘24 hours long lasting freshness,’ ‘99.9% bacteria free,’ ‘Protects against cold and flu, skin infections, food poisoning,’ and it kills 99.9 % bacteria from surfaces leaving floors and household surfaces clean, shiny and germ free, along with a disclaimer reading, ‘based on laboratory testing with concentrate usage.’

Moreover, Reckitt Benckiser, which produces ‘Dettol’, a competing product to Colgate’s Max APC, complained that Colgate Palmolive had issued a trade letter to discredit ‘Dettol’ with comparative claims, thus harming its business interests.

CCP conducted an inquiry into the matter and issued show cause notice to Colgate Palmolive on recommendations of the inquiry report. During the hearings, Colgate Palmolive could not substantiate its advertising claims for Max APC.

A bench comprising of the Chairperson Vadiyya Khalil and Member Ikram Ul Haque Qureshi passed an order stating that the advertising claims made by Colgate Palmolive were without scientific backing and evidence, and were capable of harming the business interests of Reckitt Benckiser Pakistan and other competing undertakings in the relevant market.

The bench imposed a penalty of PKR 10 Million on Colgate Palmolive for violating Section 10 of the Competition Act, and directed the company to suitably modify its claims relating to Max APC and omit any misleading comparisons from its trade letter. The company was reprimanded not to indulge in deceptive marketing practices in future to avoid stricter penal consequences.

CCP is mandated under the Competition Act to ensure a healthy competition in all spheres of commercial and economic activity to enhance economic efficiency and to protect consumers from anti-competitive practices.




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