CCP imposes Rs10mn penalty on Colgate-Palmolive Pakistan

ISLAMABAD: The Competition Commission of Pakistan (CCP) has imposed a penalty of PKR 10 million on Colgate-Palmolive Pakistan Private Limited for running a deceptive marketing campaign for one of its products.

The CCP passed an order of penalty for running `Max All Purpose Cleaner' (Max APC), in violation of Section 10 of the Competition Act, 2010, a press release Wednesday said.

The CCP had 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 and false claims such as `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.

The 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.