KARACHI: In a chilling blow to “deceptive marketing,” the Competition Commission of Pakistan (CCP) on Friday imposed a hefty fine of Rs75 million ($269,530) each on two multinational companies, Unilever Pakistan and Friesland Campina Engro, for misleading consumers by advertising their products as “ice cream.”
The CCP took action following a complaint by Pakistan Fruit Juice Company, the manufacturer of “Hico,” which objected to the marketing practices adopted by its rivals.
The CCP maintained that the two companies were selling “frozen desserts” while passing them off as ice cream, a distinct product category made from milk, cream or other dairy products.
“It is held that a false and misleading impression of ‘frozen dessert’ as ‘ice cream’ was created and continued by the Respondents through their advertisements, in order to make the consumers believe that ‘frozen dessert’ products are also ‘ice cream,’” the CCP said in its written order.
“The Respondents advertised, labelled and marketed their products without disclosing the true nature of their products as frozen desserts,” it continued, adding that the two companies “took economic advantage of their deceptive marketing practices to the detriment of consumers welfare.”
The CCP’s ruling referenced the Pakistan Standards and Quality Control Authority (PSQCA) and the Punjab Pure Food Regulations 2018, which define “frozen dessert” and “ice cream” as distinct products.
According to these standards, “ice cream” is made from milk, cream, or other dairy products, while “frozen desserts” are prepared from a pasteurized mix consisting of edible vegetable oils and other ingredients.
The CCP also noted that other countries, including the US, India and Australia, maintain the same standards, where the term “ice cream” can only be applied to dairy-based products.
The commission instructed the companies to stop their current marketing practices and remove advertisements presenting frozen desserts as ice cream.
It instructed them to provide clear disclosures about their products’ nature and ingredients, adding that failure to comply with the verdict within 30 days would result in additional fines.