Competition Commission of Pakistan fines frozen dessert makers Rs75 million for misleading advertising
The Competition Commission of Pakistan (CCP) has imposed a hefty fine of Rs75 million on two unsuspecting frozen dessert makers for misleading buyers by falsely advertising their products as “frozen yogurt”. The move comes after the CCP launched a formal investigation into Pakistan Organic Product Juice Organization (Pvt) Ltd, a major player in the frozen yogurt industry and maker of the notable “Haiko” frozen yogurt brand, in light of a documentary blunder.
Protests and allegations
The case began when the Pakistan Natural Product Juice Organization raised concerns about the tricky display practices used by two competing companies, Unilever Pakistan and FrieslandCampina Engro. The organizations, which individually manufacture frozen treats under the brand names of “Walls” and “Omor,” were accused of deceiving the general public by promoting their products as frozen yogurt through various channels, including TV spots and virtual entertainment stages.
The protest center confirmed that these brands were misrepresenting their frozen foods as frozen yogurt, abusing the freedoms of buyers accordingly and engaging in exchange practices. This created confusion among consumers and also gave the brands an unreasonable upper hand over individuals who adhere to legitimate principles for the creation and promotion of frozen yogurt.
CCP Examination and Show Cause Notice
After receiving the objection, the CCP took immediate action by initiating a traditional request for additional examination of the matter. With the ultimate objective of determining the issue, the Commission granted show cause notice to the alleging organisations, Unilever Pakistan and FrieslandCampina Engro, giving them an opportunity to respond to the allegations and justify their advertising practices.
The investigation revealed that both the entities were promoting their products as frozen yoghurt, irrespective of the fact that these products did not meet the necessary guidelines set by the food experts in Pakistan. These problematic advertising practices were seen as a violation of the consumer protection regulations and the principles of fair competition.
Legal guidelines and distinguishing frozen yoghurt from frozen food
To aid in its findings, the CCP referred to the clear guidelines laid down by the Pakistan Standards and Quality Control Authority (PSQCA) as well as the Punjab Unadulterated Food Guidelines of 2018. "and" frozen pastries", with each item class having its own specific fixing and creation conditions.
PSQCA PS 969-2010, clearly frames that frozen yogurt must be prepared from a combination of milk, cream, or other dairy items. In contrast, frozen sweets are prepared using a sterile mixture, which usually includes a mixture of milk, dairy items, and flavored vegetable oil. This qualification is important for both makers and buyers to guarantee that the correct item is being advertised and consumed.
Administration and penalties
In the wake of the case hearing, the CCP bench comprising Salman Amin and Saeed Ahmed Nawaz argued that both producers were at legitimate fault for extortion. The commission's selection highlighted the importance of adhering to food guidelines and protecting buyers from deceptive promotions.
Due to their activities, the CCP forced a fine of Rs. Unilever Pakistan and Friesland 75 million on Campina Engro. The heavy fines are planned to deter further fraudulent advertising and urge manufacturers to comply with applicable regulations and guidelines governing food products in Pakistan.
Business Tips
The CCP framework is filled with a strong warning to various food industry organizations, especially those involved in the assembly and promotion of frozen foods, to be straightforward in their advertising and ensure that their products are presented to consumers in a fair manner. Fraudulent advertising can not only damage a brand’s reputation at any given point but can also result in huge monetary penalties, as demonstrated in this case.
Finally, the choice of the Competition Commission of Pakistan to impose fines on Unilever Pakistan and Friesland Campina Engro highlights the importance of maintaining fair competition in the pursuit of consumer freedoms. This choice increases the need for organizations to display their items according to guidelines set by management experts, thereby guaranteeing that consumers will not be misled or confused about the items they purchase.
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