The Competition Appellate Tribunal (CAT) has upheld the findings of the Competition Commission of Pakistan (CCP) against Unilever Pakistan and Friesland Campina Engro for misleading consumers by advertising their frozen desserts as ice cream.
The tribunal reduced the penalty on each company from Rs. 75 million to Rs. 15 million.
The CCP had initiated proceedings following a complaint filed by Pakistan Fruit Juice Company Private Limited, the maker of Hico ice cream. The complaint alleged that Unilever and Friesland Campina Engro engaged in deceptive marketing by portraying their frozen desserts as ice cream in television and social media advertisements.
Following a formal inquiry, the CCP issued show-cause notices to Unilever Pakistan and Friesland Campina Engro, which market frozen desserts under the brand names Walls and Omore.
In its order, the Commission relied on standards issued by the Pakistan Standards and Quality Control Authority and the Punjab Pure Food Regulations 2018. These standards clearly distinguish ice cream from frozen desserts. Ice cream is defined as a product made from milk, cream, or other dairy ingredients, while frozen desserts are prepared from a pasteurized mix that may include milk products and edible vegetable oils.
The CCP directed both companies to stop presenting frozen desserts as ice cream in their advertisements, holding that such practices amounted to providing false and misleading information to consumers in violation of Section 10 of the Competition Act.
However, the tribunal reduced the penalty on each company from Rs. 75 million to Rs. 15 million. In Unilever Pakistan’s case, an additional penalty for running advertisements falsely claiming that its frozen dessert was healthier than dairy ice cream was reduced from Rs. 20 million to Rs. 5 million.
The tribunal emphasized that the reduction of the penalty should not be construed as condoning the violation, but rather as a calibrated exercise of appellate discretion guided by the principles of proportionality and mitigating circumstances.