ISLAMABAD: The Competition Commission of Pakistan (CCP) has imposed a penalty of Rs40 million on Al-Ghazi Tractors Limited (AGTL) for misleading consumers with a false fuel efficiency claim in a prominent newspaper advertisement.
The advertisement, which appeared in January 2022, claimed that AGTL’s New Holland tractor models offered “up to 30% extra diesel savings compared to any competitor’s tractors.” The company cited the Agricultural Mechanization Research Institute (AMRI), Multan as the source of this assertion.
However, a CCP investigation revealed that AMRI never issued any report validating the 30% savings claim. On the contrary, AMRI had cautioned AGTL against misusing its name and asked the company to retract the advertisement. The referenced report had only compared AGTL’s tractor with one other manufacturer and contained no broad-based fuel efficiency comparisons. AMRI also clarified that the document merely included general energy-saving guidelines and was not a certification of any model’s performance.
Despite AMRI’s objection, AGTL continued to promote the claim as universally applicable, prompting complaints from stakeholders and eventually leading to the issuance of a show cause notice by the CCP in January 2024.
In its defense, AGTL challenged the notice, arguing that the Commission had neither conducted a formal inquiry nor accurately interpreted the advertisement. However, the CCP bench — comprising Chairman Dr. Kabir Ahmed and Member Salman Amin — ruled that sufficient evidence existed to proceed under Section 30 of the Competition Act, which deals with deceptive marketing practices.
The Commission underscored the impact of such misleading claims on small farmers, who form the backbone of Pakistan’s agricultural sector. In many cases, a tractor represents a once-in-a-decade investment, and false claims about fuel efficiency can misguide their purchasing decisions, potentially worsening their already fragile financial circumstances.
