CCP fines tractor manufacturer Rs40m over false fuel-saving claim

ISLAMABAD: The Competition Commission of Pakistan (CCP) has imposed a penalty of Rs40 million on a tractor manufacturer for making false claims about diesel savings in a national newspaper advertisement.

In a statement issued on Tuesday, the CCP said the company advertised that its tractors offered “up to 30 per cent extra diesel savings compared to any competitor’s tractors”. The claim was allegedly based on a report by the Agricultural Mechanisation Research Institute (AMRI), Multan. However, upon investigation, the CCP found that no such report existed to support the claim. In fact, AMRI had cautioned the company to stop misusing its name and to withdraw the misleading advertisement.

The commission noted that purchasing decisions in rural Pakistan -- particularly by small-scale farmers -- are heavily influenced by promises of fuel efficiency and cost savings. Misleading such consumers can have serious financial consequences, especially as a tractor is often a once-in-a-decade investment for many.

The CCP bench, comprising Chairperson Dr Kabir Ahmed and member Salman Amin, found that the advertisement violated competition law and misled consumers. The penalty was imposed under Section 30 of the Competition Act.

The AMRI document referenced in the ad had tested only two brands and did not present a comprehensive comparison of fuel efficiency across the market. Furthermore, the report contained general energy-saving suggestions and did not certify the fuel performance of any specific model. Despite this, the company presented the 30 per cent savings claim as if it applied universally.

The company’s legal representative challenged the show cause notice, arguing that the CCP had not conducted a full inquiry and had misunderstood the advertisement. However, the commission maintained that sufficient evidence had been gathered to take action without a formal investigation under Section 37.

In its statement, the CCP emphasised the importance of truthful marketing, especially in sectors that directly affect low-income consumers. Misleading advertisements, it said, distort the market and hurt public trust.

Sidhu also urged people to report any associations involved in the sharing of price-sensitive data. Information can be shared confidentially by calling 0304-0875255 or via email at miu[at]cc[dot]gov[dot]pk.