KARACHI: The Competition Commission of Pakistan (CCP) has imposed a penalty of Rs150 million ($535,283) on Mezan Beverages (Private) Limited for “deceptive marketing” in a case brought against it by PepsiCo, the CCP said on Friday.

The case dates back to 2018, when the American multinational food and beverage corporation filed a complaint alleging that Mezan Beverages’ ‘Storm’ energy drink was designed to imitate its ‘Sting’ and benefit from PepsiCo’s goodwill.

Instead of responding on merits, Mezan Beverages repeatedly challenged the CCP’s jurisdiction and initiated prolonged litigation, delaying the inquiry for several years by obtaining stay orders from the Lahore High Court in 2018 and 2021, according to the CCP.

In June 2024, the court dismissed Mezan Beverages’ petition, upheld the CCP’s authority, and ruled that early challenges to show-cause notices were not maintainable. The court observed that the Pakistani beverage maker had used litigation to delay regulatory proceedings.

“The company (Mezan Beverages) was found to have imitated the packaging and trade dress of PepsiCo’s Sting energy drink, thereby engaging in deceptive marketing practices in violation of Section 10 of the Competition Act, 2010,” the CCP said in a statement.

“Such conduct amounted to parasitic copying and constituted deceptive marketing prohibited under Pakistan’s competition law.”

Such rulings remain uncommon in Pakistan, where prolonged litigation, frequent stay orders and jurisdictional challenges often delay or dilute enforcement of competition and consumer protection laws. Regulatory actions are frequently stalled for years in courts, allowing companies accused of unfair practices to continue operating while cases remain unresolved.

In its verdict, the CCP said Mezan Beverages’ energy drink adopted a red-dominant color scheme, identical to Sting; bold, slanted white lettering with aggressive visual motifs; near-identical bottle shape and presentation; and branding elements likely to mislead an ordinary consumer with imperfect recollection.

It emphasized that deception is assessed based on the overall commercial impression, not minute differences examined side by side.

“Even though Mezan Beverages held a registered trademark for ‘Storm’... copycat branding and misleading packaging will not be tolerated, regardless of the size or local status of the company,” the commission added.