RANA ELECTRIC STORE vs COMPETITION COMMISSION OF PAKISTAN Ss — 2023 CLD 1556 COMPETITION-APPELLATE-TRIBUNAL |

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RANA ELECTRIC STORE VS COMPETITION COMMISSION OF PAKISTAN Ss. 2, 3, 10, 30, 37 & 42---Deceptive marketing practices---Share market of an undertaking (company)---Dominant position, abuse of---Relevant market---Scope---Competition Commission ('the Commission') imposed penalty of Rs. 500,000/= upon electric cable/wire manufacturing company (appellant) who had adopted the practice of inserting cash/cash coupons of various denominations in the packing of the electric wire cable bundles without any indication of availability of scheme---Plea of the appellant was that the Commission overlooked its market share and imposed penalty was disproportionate to their market share---Validity---To prove deceptive practices, the US Federal Trade Commission had established key elements which were; firstly, there must be a representation that was likely to mislead consumer; secondly, it was important to evaluate whether the consumer was acting reasonably in the circumstances and; thirdly, the representation must be material in nature---While Ss. 2(1)(e) & 2(1)(k) of the Competition Act, 2010, defined the dominant position and the relevant market, S. 3 of the Competition Act, 2010, dealt with abuse of dominant position and it also mentioned the practices which constituted an abuse of dominant position and it also mentioned the practices which constituted an abuse of dominant position---Deceptive marketing practice was not included in the "practices" referred in S. 3(3) of the Competition Act, 2010---Abuse of dominant position by an undertaking could be relevant in misleading representations, where the aim was to keep the potential competitors out of the market---Purpose of said abuse of dominant position was to maintain and firm market power by preventing new entrants---Whereas, in the present case, the appellant was involved in deceptive marketing practice with intention to mislead an ordinary consumer---"Market share" was not relevant in cases involving deceptive marketing practices---In terms of S. 10(2)(b) of the Competition Act, 2010, the market share was not considered as a significant factor in assessing deceptive practices, unless there was an abuse of dominant position involved, which was not the case in the present appeal---However, the market share of an undertaking engaged in deceptive marketing practices could be considered as relevant in cases in assessing the potential harm caused to the business interests of other undertakings in terms of S. 10(2)(a) of the Competition Act, 2010, therefore, the market share was not considered as a relevant factor in deciding the issue of deceptive marketing practice---Impugned order revealed that the undertakings which did not follow a compliance oriented approach before the Commission, a penalty of Rs. 5 million was imposed on them, on the other hand, the undertakings including the appellant which committed to comply with the directions of the Commission, a lesser penalty of Rs. 500,000/= was imposed---No illegality or infirmity having been noticed in the impugned order passed by the Competition Commission---Appeal was dismissed, in circumstances. Head NotesCase Description

RANA ELECTRIC STORE vs COMPETITION COMMISSION OF PAKISTAN Ss — 2023 CLD 1556 COMPETITION-APPELLATE-TRIBUNAL

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