Resorting to deceptive marketing practices: CCP issues show cause notice to RITS Incorporation

The Competition Commission of Pakistan (CCP) has issued a show cause notice to RITS Incorporation, for resorting to deceptive marketing practices, in violation of section 10 of the Competition Act 2010, relating to its hair fall treatment product, Remaine.
The show cause notice gives RITS Incorporation 15 days to file a written reply and mandates it to appear before CCP on February 1, 2011. Earlier CCP had initiated a suo moto inquiry into the allegations of deception in the advertisements of Remaine wherein RITS Incorporation claimed the former provided 100 % hair fall treatment within fifteen days of use. RITS Incorporation further claimed in the advertisements that 'not a single hair' would fall after its use.
The probe was completed vide an enquiry report dated January 10, 2011. It concluded that RITS failed to provide any substantial evidence in support of its claim and was therefore, prima facie, violated Section 10 of the Competition Act, 2010. The CCP, as part of its obligations under the law, routinely takes up cases of deceptive marketing, which may cause harm to the consumers. This latest show cause notice is another example of CCP's active role in ensuring a competitive and business-friendly environment in Pakistan.
According to the show cause notice issued by the CCP Director General Legal Ikram Ul Haque Quershi, it came to the notice of the commission that the undertaking claims that its product Remaine provides 100 percent hair fall treatment in 15 days, upon which the Commission initiated a suo moto enquiry pursuant to Section 37(1) of the Act to determine whether, prima facie, the claim violated Section 10 of the Act which prohibits deceptive marketing practices.
The undertaking contended during the enquiry that it had ample evidence to suggest that its claims were correct and properly substantiated. However, the undertaking failed to provide any substantive or reliable evidence in support of its claims. The unit failed to provide a reasonable basis for the claims made in relation to its product Remaine, and is therefore, through its advertisement, is prima facie disseminating information/claim which lacks reasonable basis regarding character, suitability of use and/or properties of the products Remaine.
In view of the foregoing, it appears that, the undertaking is distributing false and misleading information to the consumers, which constitutes prima facie violation of section 10(1) read with Section 10(2) (b) of the CCP Act.
Therefore, the undertaking, is hereby called upon to explain in writing within fourteen (14) days of this show cause notice and to appear and place before the Commission, facts and material in support of the unit's contention and avail the opportunity of being heard through a duly authorised representative on February 1, 2011 as to why an appropriate order under clause (c) of Section 31 and/or Section 32 of the Act may not be passed and/or a penalty for the above mentioned violation may not be imposed under Section 38 of the Act.
If no reply to the Show Cause Notice is received within the stipulated period or the Undertaking fails to appear before the Commission on the above said date, the Commission shall proceed in the matter in accordance with law, Ikram Ul Haque Quershi added.