CCP Fines 3M Pakistan Rs10m Over Scotch-Brite Marketing

ISLAMABAD: The Competition Commission of Pakistan (CCP) has imposed a Rs10 million penalty on 3M Pakistan (Private) Limited for deceptive marketing of its Scotch-Brite product through a false or misleading comparison with Colgate-Palmolive Pakistan’s Max Scrub.

The CCP said the company violated Section 10 of the Competition Act, 2010, which prohibits deceptive marketing practices. 3M Pakistan (Private) Limited based in Karachi and its parent company is 3M Company, United States, who is operating in Pakistan since 1993.

The proceedings followed a complaint filed by Colgate-Palmolive Pakistan over a marketing campaign in which a video compared Scotch-Brite with Max Scrub.

According to the CCP, the demonstration showed both products being washed for 20 minutes, after which Max Scrub appeared significantly deteriorated while Scotch-Brite remained in better condition.

Following an inquiry, the CCP issued a Show Cause Notice to 3M Pakistan. The company challenged the authenticity of the video and argued that the demonstration had been carried out by an employee in his personal capacity without authorisation.

The Commission rejected the argument, noting that Muhammad Imran, then Regional Sales Manager of 3M Pakistan, acknowledged before the Enquiry Committee that he had conducted the comparison.

The CCP said the demonstration was closely linked to the employee’s official duties and took place in the context of a marketing campaign commissioned by 3M Pakistan. It therefore held the conduct attributable to the company.

The Commission found that 3M Pakistan had failed to provide reasonable substantiation for the product comparison. It also considered a third-party laboratory report submitted by Colgate-Palmolive, which concluded that the two products were of similar quality. The report was not rebutted by 3M during the proceedings.

The CCP also rejected 3M Pakistan’s argument that the demonstration did not amount to advertising because it was presented to third-party channel partners rather than directly to consumers. The Commission noted that these partners were engaged to promote Scotch-Brite, increase its market visibility and boost sales.

In addition to the Rs10 million penalty, the CCP directed 3M Pakistan to refrain from repeating the same or similar conduct involving Max Scrub or any comparable product of another undertaking.

The company has been given 60 days to submit a compliance report regarding payment of the penalty. Failure to comply will result in an additional Rs50,000 penalty per day from the date of the order.