Background of the Case:

Eden Builders had made false claims about the location of its housing Scheme “Eden Life Islamabad,” stating that it was situated at a drive of 12 minutes from the Serena Hotel Islamabad and five minutes from the CDA Enclave and Chak Shahzad. Moreover, while the advertisements also indicated the price of the various sized plots, there was no clear mention of the development charges to be recovered later. Eden Builders also failed to show that it had the approval of the Capital Development Authority for this housing scheme on its name.

Order:

The Commission held that the claims of the Respondent lacked any reasonable basis and were misleading. The Commission also held that the advertisement for the Scheme with its illegible disclaimer regarding the additional development charges not being included in the quoted price, was misleading and tantamount to an omission of material price related information being provided to the ordinary consumer and was deceptive in terms of Section 10 of the Competition Act.

The allusion in the advertisement to approval by CDA was also held to be a false and misleading claim, as there was no such approval. The Commission held that the distribution of false or misleading information was capable of harming the business interest of the Respondent’s competitors (the numerous housing societies within the territorial limits of Islamabad).

The Commission imposed penalty of PKR 2.5 million on Eden Builders (Pvt.) Limited for violation of Section 10 of the Competition Act, 2010 keeping view the commitment of Eden Life not to engage in deceptive marketing practices again.

The Commission observed that for the masses it almost takes a lifetime of savings or obtaining credit or loans to make such an investment for securing a more stable future. This transactional decision, according to the Commission, was a much more complex one as against buying a household or shelved product from a supermarket. In view of these observations, the Commission highlighted the higher burden placed on businesses which operate in the real estate market.

CURRENT STATUS:

Eden Life filed appeal before CAT challenging the order. Matter is subjudice before CAT.