The Competition Commission of Pakistan has fined frozen dessert manufacturers Rs.75 million each for deceiving their customers into thinking their products are ice cream.
The CCP commenced these proceedings based on the complaint filed by Hico Frozen Foods Pvt Ltd that claimed some entities were involved in ice cream misrepresentation through the advertisement and social media marketing of so-called “frozen desserts”.
The Commission ordered a preliminary investigation to be carried out in this regard and subsequently sent show cause notices to Unilever Pakistan for the brand “Walls” and Friesland Campina Engro for the brand Omore, whose frozen desserts were under investigation.
Mr. Salman Amin and Mr. Saeed Ahmed Nawaz formed the CCP bench that heard the case. The bench explained in detail the rationale that accounted for the imposition of the penalty in its order, some of which included the Pakistan Standards and Quality Control Authority (PSQCA) PS 969-2010 categorizing the Punjab Pure Food Regulations of 2018, as a legal definition of two distinct products, namely frozen dessert ice cream and ice cream. However as per the standards, ‘ice cream’ is defined strictly as products made from milk, cream or any other dairy product whereas ‘frozen desserts’ are defined as semi-finished products that must contain pasteurized mixes of milk, milk products in addition to edible vegetable oils.
In addition to this, M/s Unilever Pakistan was also fined Rs. 20 million in penalties for claiming and propagating through advertisements that their products were superior to dairy ice cream which in turn infringed subsection (c) of Section 10(2) of the Competition Act.
The ice cream regulation order has noted that organizations in Australia and even in the USA, as well as India, have been recognized to have designated ‘Ice-Cream’ to only those products that are dairy based. It is important to note that in the United States, the Food and Drug Administration has also fined a company for the sale and promotion of ‘ice cream’ on frozen dessert products other than ‘ice cream.’
The Food and Drug Administrator stated, “The advertisement of ice cream and frozen dessert products as ice cream is an attempt to mislead the customers-prevented under the section 10 of the competition act of PCA S 104 s 1/s 10 OPG.”
The companies have made attempts to deny the allegations regarding their products and the marketing of them. However, there must always be discretion regarding the promotion of such products on their websites and other online platforms, particularly when their products and services are being advertised.
We will update this story once we hear back from the companies mentioned in this report.
