recorder report

ISLAMABAD: The Competition Commission of Pakistan (CCP) has observed that consumers’ purchasing decisions are influenced by trademarks and the reputation such brands represent, reflecting importance of trademark and trade dress in the modern day business environment.

According to an order issued by the CCP against a company, before imposing a penalty and/or passing any directions in the matter at hand, the CCP deems it appropriate to highlight the importance of trademark and trade dress in the modern day business environment. The owners view their marks as vitals business asset that not only encompass and convey information about the origin of a product, but also construct visual imagery, prestige and consumers’ association and loyalty with the product. Consumers’ purchasing decisions are influenced by trademarks and the reputation such brands represent. Anyone who chooses to use a trademark or a trade dress without the owner’s permission should be mindful not only of the potential liability for infringement under the trademark laws but also of potential consequences, such as violation of Section 10 of the Competition Act, the principal legislation governing to protect public-at-large against deceptive marketing practices.

The order shall dispose of the proceedings initiated vide Show Cause Notice No. 15 of 2018 dated 04 May 2018 (SCN), issued by the Competition Commission of Pakistan (Commission) to Neucon Pakistan (the Respondent), for prima facie contravention of the provisions of Section 10 of the Competition Act 2010 (Act).

The SCN was issued to the respondent pursuant to the enquiry report dated 05 March 2018 (Enquiry Report) concluded by the Commission. The enquiry was authorized on the complaint filed on 07 June 2017 (Complaint) under subsection (2) of Section 37 of the Act by Ferozsons Laboratories Limited (Complainant).

The complainant has made out its case that it is registered and authorized right-holder of the trademark “BIOFREEZE” and its associated trade dress in this case. The Respondent, its proprietors, partners, directors, associates, agents, dealers, among others, are hereby restrained from using the impugned marks “BYQFREEZ” or any other mark with any prefix or suffix and trade dress that is phonetically, visually and as that of the Complainant mark “BIOFREEZE” and its associated trade dress.

The respondent has undertaken before the Bench that it will not repeat the contravention and comply with the provisions of Section 10 of the Act, we, therefore, are inclined to take a lenient view and imposes penalty in the amount of Rs 2,500,000 pursuant to Section 38 of the Act on the Respondent, which shall be deposited with the Registrar of the Commission within 60 days from the date of this Order. The Respondent is further directed to file, within 60 days from the date of this order, a compliance report with reference to withdrawal of the products under the mark “BYQFREEZ” and stop using the said mark.

The office of the Registrar of the Commission is directed to send a copy of this order to the Respondent for information and compliance and also to send copies of this order to the Respondents’ respective chamber of commerce for educating its Members vis-a­vis compliance with the Act.

In case of non-compliance with the directions contained in Para 34 & 35 ibid. of this order, the Respondent shall be further liable under subsection (3) of Section 38 of the Act to pay an additional penalty amounting to Rs 100,000 per day from the date of this order.

The Complainant is a public limited company registered under the law of Pakistan, who inter alia carries on the business of manufacturing, importing, packaging and selling certain medicinal/pharmaceutical products across Pakistan. As is submitted in the Complaint, the Complainant is the sole distributor and right holder in Pakistan of a complete range of products sold under the brand name “BIOFREEZE”, registered with the Trade Marks Registry in Karachi, Pakistan bearing trademark # 179961 dated 28 August 2002 in class 5 for analgesic (pain relieving) pharmaceutical preparations. The products are sold in the form of spray, gel, and roll­ on of different specifications bearing distinctive getup and color scheme or combination of color comprising predominantly of green and light blue colored text and white background. Furthermore, it was submitted that the Complainant is enlisted with the Drug Regulatory Authority of Pakistan (DRAP) as the authorized importer and distributor of pharmaceutical products branded as “BIOFREEZE”. The Complainant averred that the Respondent was fraudulently using similar, deceptive or confusingly similar mark “BYQFREEZ” in relation to similar pharmaceutical preparations in the form of spray and gel so as to pass off them as and for the products of the Complainant, which tantamount deceptive marketing practices in contravention of clause (d) of subsection (2) of Section 10 read with subsection (I) of Section 10 of the Act.