Pursuant to a complaint filed by Ferozsons Laboratories Limited, the Competition Commission recently started an enquiry into Neucon Pakistan for deceptive marketing practices under the Competition Act 2010.

The complainant is registered with the Pakistan Drug Regulatory Authority as an authorised importer and distributor of the complete range of Performance Health, USA's Biofreeze products, a clinically recommended cold therapy external pain relief product.

The complaint alleged that Neucon Pakistan had disseminated false and misleading information by distributing counterfeit packs of Biofreeze gel and spray on the local market and fraudulently using a deceptively similar trademark BYQFREEZ on its product labelling and packaging.

Consumers base their purchasing decisions on first impressions of a product's exterior and do not engage in a considered examination of the product. The enquiry committee observed that even though the respondent had chosen a slightly modified trademark and made slight alterations to the packaging, its product remained confusingly similar to the complainant's Biofreeze product (both product logos featured a deep green and a similar font on white backgrounds), which could have caused consumers to confuse one for the other.

It was therefore clear that by imitating the complainant's trademark, product labelling and packaging, the respondent had been trying to persuade consumers to buy its goods instead of those of the complainant, thus violating Section 10(2)(d) of the Competition Act (ie, fraudulent use of another party's trademark, firm name, product labelling or packaging).

The respondent's behaviour was therefore judged to have been capable of deceiving consumers of Biofreeze, which could in turn damage the complainant's business interests. The respondent had not only participated in the distribution of false and misleading information to consumers regarding the price of its products, but also harmed the complainant's business interests in terms of Section 10(2)(a) (ie, the distribution of false or misleading information that is capable of harming the business interests of another undertaking) and Section 10(2)(b) (ie, the distribution of false or misleading information to consumers, including the distribution of information lacking a reasonable basis, related to the price, character, method or place of production, properties, suitability for use or quality of goods) of the Competition Act.

The enquiry committee recommended that, in the interest of the general public, proceedings should be initiated against the respondent for violation of Section 10 of the Competition Act (ie, deceptive marketing practices).

For further information on this topic please contact Sanaya F Vachha at Vellani & Vellani by telephone (+92 21 3580 1000) or email (sanaya.vachha@vellani.com). The Vellani & Vellani website can be accessed at www.vellani.com.

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