False fuel saving claims: CCP imposes Rs 40 million penalty on Al-Ghazi Tractors

ISLAMABAD, : Farmers across Pakistan, especially small landholders often make purchasing decisions based on savings and efficiency. For them, a claim like “ up to 30% extra diesel savings” can mean the difference between affordability and hardship.
But this claim, made by Al-Ghazi Tractors Limited (AGTL) in a newspaper ad, has now been declared false and misleading by the Competition Commission of Pakistan (CCP). The bench comprising Dr. Kabir Ahmed, the Chairman CCP and Mr. Salman Amin (Member) has imposed a penalty of PKR 40 million on AGTL for violating competition law and misguiding consumers.
The Claim that Misled: 30% Extra Diesel Savings
In January 2022, AGTL ran a front-page ad in a leading Urdu newspaper, claiming its new Holland tractor models offered “up to 30% extra diesel savings compared to any competitor’s tractors.” The ad cited a report by the Agricultural Mechanization Research Institute (AMRI), Multan as basis of its claim.
But when CCP investigated, it found that AMRI had not issued any report supporting this claim. In fact, AMRI had warned AGTL to stop using its name for false claim and to retract the advertisment.
The AMRI report, which AGTL selectively quoted, only tested tractors from two manufacturers—AGTL and one competitor. It did not provide market-wide fuel efficiency comparisons. AMRI also emphasized that its report contained general energy-saving tips, not certification of any tractor model’s performance.
Despite this, AGTL promoted the 30% savings claim as if it applied across the board. The CCP received complaints from stakeholders, leading to a show cause notice in January 2024.
Legal Battle and Defense
AGTL’s lawyer challenged the showcause notice. He argued that CCP did not conduct a full inquiry and had misinterpreted the ad. But the Commission ruled that it had enough evidence to proceed under Section 30 of the Competition Act, without there being need for a formal inquiry under Section 37.
In rural Pakistan, where over 60% of the population relies on agriculture, such deceptive ads can seriously impact small farmers. A tractor is often a once-in-a-decade investment. Believing in a false fuel-saving claim could lead farmers to spend more in the long run, harming their fragile financial balance.
Dr Kabir Ahmed Sidhu, the Chairman, Competition Commission of Pakistan urges the public: If you have information about any association involved in sharing price-sensitive data, report it confidentially at 0304-0875255.