CCP imposes Rs 150m fine on Reckitt

The Competition Commission of Pakistan (CCP) on Thursday imposed a penalty of Rs 150 million on Reckitt Benckiser Pakistan Limited for making misleading and deceiving advertising claims of its product Strepsils’.

It passed an order for violation of Section 10 of the Competition Act, 2010. In its order, CCP said it made advertising and marketing claims about its product ‘Strepsils’, which were misleading and deceiving under the Act.

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M/s Square Distribution & Marketing System (Pvt) Limited had launched a formal complaint and alleged t M/s Reckitt Benckiser Pakistan Limited had been disseminating misleading information to the consumers.

The company spread information to create an impression of its product ‘Strepsils’ that it was a drug for sore throat and cough.

The other allegation was the company did not make any effort to educate and inform the consumers about its discontinuation of medicinal ingredient in it. The CCP’s enquiry found the marketing campaign of the respondent deceptive in terms of Section 10 of the Act in general, read with sub-section 10(2) (b) of the Act.

It prohibits disseminate false and misleading information to consumers. The Respondent’s misleading campaign also resulted in harming the business interests of other undertakings.

The order further stated the change in the formula of the Product had also resulted in changing medicine to a non-medicated product. The bench agreed with the finding of the Enquiry and observed the disclaimer on the box of the Product was not enough.

The bench in its order maintained the Respondent failed to substantiate neither before the Enquiry Committee nor this Bench what efforts it made to inform the general public about change in the formula of its product ‘Strepsils’.

It further said barely printing ‘Non-Medicated Lozenges’ on the product box with a very small font does not justify due and sufficient disclosures of such material change in the character of the Product.

The bench comprised Ms. Rahat Kaunain Hassan, Chairperson, and Ms. Bushra Naz Malik, Member. It observed the respondent’s marketing claims can potentially deceive consumers. In line with findings, the bench imposed a total penalty of PKR 150 million [PKR 75 million for each of the violations].

The Bench further directed the Respondent to stop misleading marketing practices of the Product. The bench further directed to print the disclaimer/disclosure, ‘NON-MEDICATED’, in English and also Urdu in bold words, on the Product box and on the strips as well in print and/or in electronic advertising/marketing. It further said to place in Urdu the disclaimer “ye dawa nahi, dawa ke liye doctor se ruju Karen”.

The bench has given 40 days to the Respondent for compliance. Meanwhile, it directed the Respondent to publish advertisements in at least three English and Urdu newspapers.