CCP Warns Against Deceptive Real Estate Practices

ISLAMABAD: The Competition Commission of Pakistan (CCP) has cautioned consumers that fraudulent housing schemes and misleading promotional activities continue to impede progress within the real estate sector.

According to a CCP directive concerning an Islamabad housing society, maintaining responsible and precise advertising standards in real estate is of utmost importance and should never be compromised. The real estate sector is crucial for any nation’s economic advancement, given its close relationships with numerous related industries. However, current regulations are insufficient, allowing deceptive marketing tactics and illegitimate housing projects to negatively impact the sector’s expansion, which ultimately undermines Pakistan’s economic stability.

The Commission acknowledges the vulnerable position of consumers who are often deceived by misleading real estate investment claims.

For many citizens, acquiring a plot of land for a secure future involves a lifetime of savings or obtaining loans from financial institutions. This type of transaction is significantly more complex than purchasing everyday items.

Higher Standards for Real Estate Marketing

“Consequently, we must emphasize the increased responsibility of businesses in the real estate market to ensure the accuracy of their marketing claims,” the CCP order stated.

The CCP Bench took into account the severity of the violation, specifically the deceptive marketing strategies, their impact on rivals and other parties, and the respondent’s lack of cooperation with the Commission’s investigations. The advertisement was broadly circulated through both digital and print channels. It is essential to discourage the respondent and similar organizations from engaging in such deceptive marketing practices in the future to safeguard market integrity and protect consumer interests.

The penalty amount was determined after considering all relevant factors outlined in the CCP’s Fining Guidelines. The housing scheme’s deceptive marketing and distribution of false information, advertising itself as another Islamabad scheme, appear to be a deliberate business strategy that began immediately after its establishment and before the implementation of the PHATA Affordable Private Housing Scheme Rules 2020.

Consequently, the CCP Bench has imposed a penalty of Rs 75,000,000 (Seventy-Five Million Rupees) on the respondent for violating Section 10(2)(b) of the Competition Act.

The Bench has also levied a penalty of Rs 75,000,000 (Seventy-Five Million Rupees) on the respondent for contravening Section 10(2)(a) of the Competition Act.