CCP imposes Rs150m fine on PSO for ‘deceptive’ marketing

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ISLAMABAD – The Competition Commission of Pakistan (CCP) has imposed a penalty of Rs150 million on the Pakistan State Oil (PSO) for running a deceptive marketing campaign for its products Premier XL (petrol) and Green Plus (diesel) in violation of Section 10 of the Competition Act, 2010.

The CCP bench that passed the order consisted of CCP Chairperson Vadiyya Khalil and members Dr Shahzad Ansar and Ikram ul Haque Qureshi.

Earlier, the CCP conducted an inquiry after receiving a complaint wherein it was alleged that since 2003/2004 the PSO had been deceptively claiming that the use of its products Premier XL and Green Plus resulted in more mileage and improved performance of vehicles’ engines due to the use of various additives. The PSO had also claimed that these products were environment friendly.

The inquiry showed that in 2012/2013 the PSO discontinued the use of such additives, however, the names of the products and the marketing campaign including the associated branding/insignias launched alongside the products in 2003/2004 remained in place till date.

The order states that during the hearings the PSO could neither provide any scientific basis for making the claims in the first place nor did it stop making the claims when it stopped mixing the additives in 2012/2013. These claims led consumers to believe that the fuel they were purchasing was superior to others and, therefore, harmed competition in the market.

In addition to imposing the penalty, the CCP has directed the PSO to immediately cease the use of ‘Green’ and ‘Premium’ on all its branding and marketing materials, and make appropriate changes within 30 days to dispel the impression that its fuel products were premium and environment friendly.

The CCP has directed the PSO to inform the general public about discontinuation of use of additives in the products through appropriate clarifications in all English and Urdu dailies for a period of one week and file a compliance report with the registrar of the Commission within a period of forty-five days from the date of issuance of this order.