Abstract/Description
The Competition Commission of Pakistan (CCP) has adopted the notion of ordinary consumer for assessing confusion or deception in ‘deceptive marketing practices’ cases under Section 10 of the Competition Act, 2010i . In its first order in this area, the CCP defined ordinary consumer as a person who is ‘the usual, common or foreseeable user or buyer of the product’ (CCPa, p. 30) and differs from the ‘ordinary prudent man’ under contract law. According to the CCP, this conceptualisation of the Pakistani consumer was important for achieving the goal of implementing the Competition Act 2010 in its letter and spirit, the intent of the law (CCPa, p. 30) and that of protecting Pakistani consumers from anti-competitive practices. Despite acknowledging that other jurisdictions such as the EU and the US follow the standards of average and reasonable consumer, respectively, the CCP considered that following these standards ‘would result in shifting the onus from the Undertaking to the consumer and is likely to result in providing an easy exit for Undertakings from the application of Section 10 of [CA, 2010]’. (CCPa, p. 30) In this paper, I argue that the ordinary consumer of the CCP does not have any normative basis either in law or in economics. This standard is also incompatible with the wellestablished Pakistani trademark law, which employs the notion of ‘consumer’ in line with the concept of bounded rationality where the consumer is unable to make decisions that maximise her utility. Defining the concept of consumer is also imperative as it has practical ramifications for marketers. For example, in the presence of these conflicting standards confusion is bound to arise as whether a marketing campaign should be designed around the concept of consumer as defined by the CCP or around that adopted by higher courts, including the Supreme Court of Pakistan in various trademarks (and passing off or unfair competition) cases? Should marketers prepare separate campaigns for so that they are not caught by the provisions of either law? Would there be one consumer profile from a target market or countless? And would there be a target market or many? To ensure normative as well as positive consistency; to provide legal certainty to marketers and to meet consumer expectations, the CCP should refer to the representative customer profile created by the marketers, in cases of deceptive marketing practices. This is the consumer for whom the product or service or the marketing campaign is created and she is the one who should not be deceived. This paper starts with the introduction of the CCP and the provision on ‘deceptive marketing practices’ in the Competition Act of 2010 (CA, 2010). I then discuss the standard of ‘ordinary consumer’ as defined by the CCP in Zong and subsequent orders. This is followed by the discussion of the basis of adoption of such standard including the basis of rejection of the EU and US definitions of the consumer. In the fourth part I discuss in detail the problem with the standard of ‘ordinary consumer’. The fifth part comprises of the discussion of the notion of ‘consumer’ under the Pakistani trademark law. I propose, in the sixth part, that the representative consumer profile created by the marketer for the purposes of developing marketing campaigns is a more appropriate standard and starting point for inquiry under Section 10 of the Competition Act, 2010. The last part concludes.
Keywords
Consumer protection, Deceptive marketing practices, Economics, Law, Marketing, Average consumer, Ordinary consumer, Reasonable consumer
Location
Seminar Room, S5 2nd Floor, CED Bldg
Session Theme
Session 3: Parallel Sessions
Session Type
Event
Session Chair
Dr. Zeenat Ismail
Start Date
3-5-2014 2:30 PM
End Date
3-5-2014 5:00 PM
Recommended Citation
Shaikh, O. H. (2014). Parallel Sessions (Consumer Behavior): The Pakistani consumer: dumb or dumber?. International Conference on Marketing. Retrieved from https://ir.iba.edu.pk/icm/2014/day1/19
Included in
Parallel Sessions (Consumer Behavior): The Pakistani consumer: dumb or dumber?
Seminar Room, S5 2nd Floor, CED Bldg
The Competition Commission of Pakistan (CCP) has adopted the notion of ordinary consumer for assessing confusion or deception in ‘deceptive marketing practices’ cases under Section 10 of the Competition Act, 2010i . In its first order in this area, the CCP defined ordinary consumer as a person who is ‘the usual, common or foreseeable user or buyer of the product’ (CCPa, p. 30) and differs from the ‘ordinary prudent man’ under contract law. According to the CCP, this conceptualisation of the Pakistani consumer was important for achieving the goal of implementing the Competition Act 2010 in its letter and spirit, the intent of the law (CCPa, p. 30) and that of protecting Pakistani consumers from anti-competitive practices. Despite acknowledging that other jurisdictions such as the EU and the US follow the standards of average and reasonable consumer, respectively, the CCP considered that following these standards ‘would result in shifting the onus from the Undertaking to the consumer and is likely to result in providing an easy exit for Undertakings from the application of Section 10 of [CA, 2010]’. (CCPa, p. 30) In this paper, I argue that the ordinary consumer of the CCP does not have any normative basis either in law or in economics. This standard is also incompatible with the wellestablished Pakistani trademark law, which employs the notion of ‘consumer’ in line with the concept of bounded rationality where the consumer is unable to make decisions that maximise her utility. Defining the concept of consumer is also imperative as it has practical ramifications for marketers. For example, in the presence of these conflicting standards confusion is bound to arise as whether a marketing campaign should be designed around the concept of consumer as defined by the CCP or around that adopted by higher courts, including the Supreme Court of Pakistan in various trademarks (and passing off or unfair competition) cases? Should marketers prepare separate campaigns for so that they are not caught by the provisions of either law? Would there be one consumer profile from a target market or countless? And would there be a target market or many? To ensure normative as well as positive consistency; to provide legal certainty to marketers and to meet consumer expectations, the CCP should refer to the representative customer profile created by the marketers, in cases of deceptive marketing practices. This is the consumer for whom the product or service or the marketing campaign is created and she is the one who should not be deceived. This paper starts with the introduction of the CCP and the provision on ‘deceptive marketing practices’ in the Competition Act of 2010 (CA, 2010). I then discuss the standard of ‘ordinary consumer’ as defined by the CCP in Zong and subsequent orders. This is followed by the discussion of the basis of adoption of such standard including the basis of rejection of the EU and US definitions of the consumer. In the fourth part I discuss in detail the problem with the standard of ‘ordinary consumer’. The fifth part comprises of the discussion of the notion of ‘consumer’ under the Pakistani trademark law. I propose, in the sixth part, that the representative consumer profile created by the marketer for the purposes of developing marketing campaigns is a more appropriate standard and starting point for inquiry under Section 10 of the Competition Act, 2010. The last part concludes.
