The development has taken place in the wake of the CCP suo moto notice of firms involved in advertising/marketing and selling of weight loss products by concealing potential side effects of products.
The CCP took action against 14 pharmaceutical/herbal companies involved in advertising/marketing and selling of weight loss products by concealing potential side effects of products.
A CCP bench comprising senior members issued an order against the companies involved in selling weight loss products, revealing that the whole industry is involved in deceptive marketing practices.
It was revealed that the actions of the respondent companies and their possible anti-competitive effects had interprovincial spillover effects, as the respondents had been operating and selling their products all over Pakistan, including the federal capital in addition to their online operations through websites. The anti-competitive behavior would have a spillover effect on trade and commerce beyond the boundaries of a single province or territory.
The CCP bench observed that through advertisements, a fictitious impression about the weight loss products, was created and the public was ultimately convinced that these products had miraculous outcomes within a negligible amount of time. It noted that the companies had been advertising/marketing and selling these products without mentioning the potential side effects that might occur as a consequence of regular consumption of the products.
“The companies have also failed to disclose to their consumers the potential impact their product can have on people having different medical conditions, such as diabetes, hypertension, allergies, etc., which may cause life-endangering effects on consumers suffering from certain medical conditions,” CCP bench said.
The bench reached the conclusion that deceptive marketing, specifically in terms of Section 10(2)(b) of the Competition Act, was an industry- wide practice and the market of weight loss products and dietary supplements had remained unregulated for a long time.
“The Bench, therefore, is inclined towards corrective behavior in this matter, and has decided not to impose penalties on any of the Respondents, however, the Bench has decided to issue guidelines in terms of marketing of weight loss products,” the order reads.
The CCP, taking inspiration from the guidelines provided by the Competition Bureau Canada for weight loss products, has issued the following guidelines to all the undertakings marketing weight loss products in the market:
In order to substantiate the weight-loss claims, the undertaking advertising a weight loss product must possess and rely upon competent and reliable scientific evidence to substantiate that the representation is true.
When it comes to the weight-loss claims, testing must be adequate and proper, and the undertakings marketing a weight loss product should pay particular attention to ensure that testing is done properly and in a controlled environment to account for other variables.
In the bench’s view testing should be rigorous. For example, an independent, well-conducted, randomized, placebo-controlled, double-blind study for a weight loss product to be considered adequate and proper. To ensure that the results are reliable, the Bench recommends that undertakings use the services of reputable laboratories to design and conduct testing of the products.
The undertakings must remember to not include false or misleading representations to the public when marketing a weight loss product. These include representations that suggest that claims have been endorsed or approved by a reputable body or government agency, or have been substantiated in extensive clinical trials, where that is not the case.
Similarly, if the product is being marketed through the use of testimonials or is endorsed by influencers, the bench would expect them to be true, accurately conveyed and provided by actual customers who have no material connection with the undertaking advertising the product unless such a connection is properly disclosed.
In addition to the above, the undertaking advertising a weight loss product must include fit and appropriate disclaimers with respect to the product(s) including but not limited to the side effects of its product on common people and people with certain medical conditions or illnesses, as well as varying results on consumers based on their diet, age, exercise and any other relevant aspects, in their marketing/advertising material.
The companies are directed that all advertisements, promotional materials, or instructional manuals pertaining to the weight loss products; manufactured by the undertakings whether electronic, printed or otherwise are to be modified to disclose and display
- truthful claims
- omit untrue claims
- the presence of disclaimers about its side effects on certain consumers with medical conditions etc., on each pack for the consumer, within a period of 120 days starting from the date of this order.
The disclosure with respect to the disclaimers, side effects and omission of untrue claims on marketing materials of weight loss products as mentioned at (b) above should be made with the use of bright/conspicuous colors distinct from the color of the packaging of the product and should be printed in clear, bold and legible size.
The companies will also issue four advertisements/public notices to be published in at least two Urdu and two English newspapers of national circulation; making due disclosures to the public regarding the disclaimers and side effects of their products and the omission of untrue claims from their products.
According to the CCP bench order, the compliance report with respect to the implementation of the aforementioned directions must be filed by the undertakings no later than 180 days from the date of this order. Continued violation and/or non-adherence to the directions of the Commission, by any of the Respondents, may attract proceedings, in accordance with Section 38 of the Act, it adds.