The CCP’s investigation into the entire paint industry revealed that Diamond Paints had not adhered to these guidelines, particularly regarding the disclosure of redeemable tokens
ISLAMABAD: The Competition Commission of Pakistan (CCP) has imposed a penalty of Rs 5 million on M/s Diamond Paint Industries (Pvt) Ltd. for breaching Section 10 of the Competition Act, 2010, which pertains to deceptive marketing practices. This action was taken following a complaint lodged by Nippon Paint Pakistan (Pvt) Ltd. against Diamond Paint’s marketing campaign for its product ‘Durasilk’, which was aired on various television channels.
The order, issued by a CCP bench chaired by Dr. Kabir Ahmed Sidhu and Member Salman Amin, highlighted that this was the third instance where concerns had been raised about the omission of critical information in television commercials (TVCs) by paint manufacturers. The investigation revealed that Diamond Paint, while including disclaimers on its packaging and shade cards, failed to disclose in its TVCs the presence and value of redeemable tokens inside its paint buckets. This omission was found to be exploitative, as it deprived consumers of essential information that would enable them to make informed purchasing decisions.
The CCP underscored the importance of transparency in advertising, noting that TVCs often serve as the primary point of contact between consumers and products. The order referenced the CCP’s Paint Order 2012, which explicitly required that any inclusion of a token in a product without proper disclosure would be considered as lacking a reasonable basis with respect to prices, thereby violating Section 10(2)(b) of the Competition Act. The CCP’s investigation into the entire paint industry revealed that Diamond Paints had not adhered to these guidelines, particularly regarding the disclosure of redeemable tokens.
The CCP bench emphasized that proper disclosure of such tokens is crucial, as marketing techniques involving redeemable coupons significantly influence consumer purchasing decisions. The ruling concluded that M/s Diamond Paint Limited’s failure to provide complete information to consumers not only violated the CCP’s earlier directives but also contravened Section 10 of the Competition Act, warranting the imposed penalty.
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