MULTAN: An inquiry committee of the Competition Commission of Pakistan (CCP) recommended action against two local companies for deceptive marketing.

Ismail Industries Limited filed a complaint with the commission against SM Food Makers Limited and Volka Food International Limited for alleged violation of Section 10 of the Competition Act 2010, pertaining to deceptive marketing practices, stating that both the complainant and respondents were engaged in the business of production, marketing, sales and export of a wide range of confectionery items and the respondents had copied/imitated the registered trademark and copyrighted packaging of the complainant, and by doing so distorted healthy competition in the market.

An inquiry committee was constituted to determine whether the respondents were violating the specific sections of the act that prohibited fraudulent use of another’s trademark, firm name, or product labelling or packaging; or the respondents were involved in distribution of false or misleading information to consumers related to character, place of production, properties and quality of goods and/or the conduct of the respondents is capable of harming the business interest of the complainant.

The complainant stated that its main activities were manufacturing, trading and export of a variety of products, including confectionary items under the house mark Candyland, biscuits under Bisconni, potato chips and snack foods under Snack City, cast polypropylene film marketed and sold under Astropack.

It stated that SM Food Maker sold confectionary and snack products under various house marks, including Gibs, Donal, Kims and Silver Lake, while Volka Foods International was a directly affiliated concern with SM Food Makers that operated under the house marks of Giggly, Volka, and Cookania.

“Both respondents operate in the same sector, led by Mr Chaudhry Zulfiqar Ali Anjum and family,” it stated.

The inquiry committee, while recommending action against the respondent companies under Section 30 of the Competition Act 2010, stated that their packaging could strongly mislead the consumers and lead them to make transactional/financial decisions based on duplication of the trademark and trade dress of the complainant; the respondents’ actions were likely to cause even more damage because the product channels of trade and probable customers of the complainant and those of the respondents were same because of which the customers could be deceived constantly, while the complainant’s business interest is harmed. If the respondents were allowed to carry on with their deceptive and unfair practice, the complainant will suffer not only business losses, but irremediable harm to its goodwill, reputation and exclusivity.

“It is therefore in the interest of the general public that the respective undertakings should be restrained from advertising their products/services in an unfair and misleading manner and instead be encouraged to resort to advertising practices which are transparent and give consumers/customers true and correct information,” the report stated.

Published in Dawn, July 5th, 2020