CCP's directive to companies: Ads claims must be based on 'competent, reliable scientific evidence'

The Competition Commission of Pakistan (CCP) has directed companies and other undertakings to ensure that while marketing their products, the advertising claims must be based on 'competent and reliable scientific evidence,' particularly if the product involves health and safety claims.
It is learnt that the CCP issued these directions to companies in a recent order passed against Proctor & Gamble Pakistan Limited for violation of Section 10 of the Competition Act, 2010. CCP also directed companies to print clear and conspicuous disclaimer/disclosure along with the claims, which the consumers could easily notice and understand.
According to Section 10(2)(b) of the Competition Act, marketing and advertising claims made by an undertaking must have a reasonable basis related to product's price, character, method or place of production, properties, suitability for use, or the quality of goods.
Sources told Business Recorder that it is becoming a common practices that companies advertise their products as 'No 1' or 'No 1 rated' on the basis of vague surveys made by unknown entities thus rendering such claims not only dubious but harmful for consumers interest besides distorting competition in the market.
It is pertinent to note that only the Competition Act, 2010 protects consumers and companies from deceptive marketing practices and CCP has been empowered to impose penalties and propose remedies in this regard. It is CCP's statutory responsibility to restore and maintain competition in the market and protect consumers from anti-competitive practices including deceptive marketing practices. The recent enforcement orders passed by CCP are mostly against companies engaging in deceptive marketing practices, which shows CCP's increased focus on consumer protection.
Some recent CCP's enforcement orders against companies for deceptive marketing practices include a penalty of Rs 10 million on Proctor & Gamble Pakistan Limited for terming its product 'Safeguard' as Pakistan's No 1 rated soap, Rs 65 Million on dairy companies for marketing tea whiteners as milk, Rs 2 Million on an education entity for showing false affiliation with CFA Institute, Rs 150 Million on Pakistan State Oil for deceptively advertising its petroleum products, and PKR 20 Million on Dawn Foods for deceptive marketing practices.
Most of the violations of Section 10 are common and involve deceptive marketing practices such as hiding material information, giving wrong or no disclaimer at all, and quoting vague surveys. In one of its orders, CCP elaborated what constituted false information and misleading information.
All representations, according to CCP, whether intentional or unintentional, which are not easily noticeable or easily understandable to consumers but could influence consumers' purchasing decisions are materially false. Similarly, all representations that can give false impression or idea or have the likelihood to induce one's conduct , thought or judgement or have the potential to misinform or misguide due to vagueness, or omission, are materially misleading. Most of the CCP's enforcement orders also serve as guidelines to other companies to comply with the provisions of the Competition Act and avoid penalties.