UNFAIR TRADE

PRACTICES

SUBMITTED BY

TABINDA SHAHEEN
SAVEEZA KABSHA
UNFAIR TRADE PRACTICE

 Unfair Trade Practice (UTP)

 Any fraudulent, deceptive or

dishonest trade practice; or
business misrepresentation of the
products or services being sold;
which is prohibited by a Statute or
declared actionable by Court
judgement

 Lacks any universal standard

definition
 LEGISLATIONS PROHIBITING UTP
 INTERNATIONAL
• World Bank and the Organization for Economic Cooperation and Development
(OECD) Model Law
• Paris Convention

 NATIONAL
• India
 Competition Act, 2002
• Australia
 The Australian Competition and Consumer Act, 2010
• United States of America
 Federal Trade Commission Act, 1914
• South Africa
 Consumer Affairs (Unfair Business Practices) Act, 1988
• Pakistan
 Consumer Protection Act (Each province and capital
 territory have their own legislation)
 TYPES OF UNFAIR TRADE PRACTICES

 Punjab Consumer Protection Act, 2005

 Sections 21 and 22

• False representation

• False offer of bargain price

• Free gifts offer and prize scheme

• Non-compliance of prescribed standards

• Hoarding or destruction of goods

 FALSE
REPRESENTATION
• Falsely suggests that the goods are of a particular standard quality,
quantity, grade, composition, style or model
• Falsely suggests any re-built, second-hand renovated, reconditioned or
old goods as new goods
• Makes a false or misleading representation concerning the need for, or
the usefulness of, any goods or services
• Materially misleads about the prices at which such goods or services are
available in the market
FALSE REPRESENTATION

 False and misleading

advertisements violate many
basic rights of consumers
• The right to information
• The right to choice
• The right to be protected against
unsafe goods and services
 MARTY V.
ANHEUSER-BUSCH
• Case related to misrepresentation of the origin of Beck’s

• Beer originated and was brewed in Germany from 1873 until

2012 when A-B began brewing this beer in St. Louis, Missouri

• Plaintiffs are consumers of Beck’s who purchased this beer

brand “in reliance on the representations contained on their
packaging and Beck’s history of being an imported beer from
Germany.”

• Plaintiffs alleged that A-B made misrepresentations about

Beck’s origin which caused confusion among consumers
• Compensation to plaintiffs exceeded $20 million

• Class Members received a partial refund for prior purchases

of Beck’s Beer
 2015 AC 207

• Manufacturing and Expiry date not published on products

• Punjab Consumer Protection Act, 2005, section 21(e)

• Order to publish manufacturing and expiry date

 AIR 2010 SC
1162 :

• Falsely represented by doctor that he was a

specialist

• Deficiency in medical service

• Punjab Consumer Protection Act, 2005,

section 22

• Damages granted

Punjab Consumer Protection Act-2005

 BARGAIN PRICE

• The price stated in the advertisement in such manner

as suggests that it is lesser than the ordinary price

• The price which any person coming across the

advertisement would believe to be better than the price
at which such goods are ordinarily sold
 FREE GIFTS OFFER AND PRIZE SCHEMES
• Creating impression that something is being offered free along with the goods,
when in fact the price is wholly or partly covered by the price of the article sold

• Offering some prizes to the buyers by the conduct of any contest, lottery or
game of chance or skill, with real intention to promote sales or business
 CO.F.T.C. V. MARY CARTER PAINT CO.

• 382 U.S. 46 (1965)

• Company offered, from the time it began business, to sell
on a two-for-one basis: “every second can FREE, gallon or
quart.”
• The problem was that it had never priced and sold single
cans of paint, so the FTC assumed that the price of the
second can was included in the first, even though Mary
Carter claimed it had established single-can prices that
were comparable to those for paint of comparable quality
sold by competing manufacturers
• The Supreme Court sustained the commission’s finding of
deception
 SALE OF SUB STANDARDS
GOODS
 Any sale or supply of goods, for use by consumers, knowing or
having reason to believe that the goods do not comply with
the standards prescribed by some competent authority, in
relation to their performance, composition, contents, design,
construction, finishing or packing, as are necessary to prevent
or reduce the risk of injury to the person using such goods,
shall amount to an unfair trade practice.
 HOARDING OR DESTRUCTION OF GOODS

 Any practice that permits the hoarding or

destruction of goods, or refusal to sell the
goods or provide any services, with an
intention to raise the cost of those or other
similar goods or services, shall be an unfair
trade practice.
 BAIT ADVERTISEMENT
No person shall, in trade, advertise or supply at a
specified price products or services which that
person–
a. does not intend to offer for supply; or
b. does not have reasonable grounds for believing
that they can be supplied
 EXAMPLE

 A car dealer advertises certain vehicles at a

special price. Customers are then told that the
vehicles have been sold or are out on a test drive.
No cars are ever available at the advertised price.