Mezan Beverages using legal tactics to delay CCP action

ISLAMABAD  -  Mezan Beverages (Private) Limited has been using legal manoeuvres to impede the Competition Commission of Pakistan.

Since the initiation of enquiry in August 2018 against Mezan’s alleged involvement in deceptive marketing practices, the com­pany has obtained injunctions on two differ­ent occasions. On 12 October 2018, Mezan filed a writ petition and obtained a stay or­der against the initiation of the enquiry. The stay order lasted for two years. LHC vacated the stay on October 26, 2018, according to the information received from the CCP.

On 28 June 2021, CCP completed its en­quiry and issued a show cause notice to Meezan on 7 July 2021. On 3 August 2021, Mezan obtained another stay order from LHC against the CCP’s show cause notice. The stay order is ongoing from August 2021 up until today. The enquiry was start­ed when CCP received a formal complaint from Pepsi Co Inc. against Mezan Beverag­es (Private) Limited. The complaint stated that Mezan was copying the overall pack­aging of Pepsi’s energy drink “Sting” for Mezan’s energy drink “Storm.”

It is pertinent to mention here that the Supreme Court discourages interference in the statutory jurisdiction of public sector entities. According to the Supreme Court, the law provides adequate remedies, and constitutional jurisdiction should only be exercised in exceptional circumstances. In September this year, the Supreme Court of Pakistan unanimously upheld the statuto­ry powers of the Competition Commission of Pakistan (CCP) relating to initiation of enquiries and gathering of information.

In 2020, CCP initiated an enquiry had sought information from cooking oil and ghee companies for information about ghee and cooking oil prices. Dalda Foods challenged the enquiry in the Islamabad High Court. The Islamabad High Court had set aside CCP’s call for information let­ters and the initiation of enquiry. The high court had imposed extraordinary require­ments on the exercise of CCP’s regulatory and enquiry powers. CCP had challenged the decision of the High Court before the Supreme Court of Pakistan. While allow­ing the CCP’s appeal the Supreme Court set aside these requirements, which included the requirement to provide detailed rea­soning to an undertaking when initiating an enquiry and to pass a reasoned order in this regard. Hence the stance and actions of the CCP were upheld in the historic and landmark judgment of the Supreme Court.

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