Unfair trade

practices
during
Covid-19
Submitted by;
Group 5
Satish Yadala – G015
Ujjval Kumar Patel- G020
Aditya Goenka- G027
Urvi Sawant – G034
Muskan Beri – G051
Abhirup Sengupta- G058
 WHAT ARE UNFAIR TRADE PRACTICES?

The phrase ‘unfair trade practices’ can be

defined as any business practice or act that is
deceptive, fraudulent, or causes injury to a
consumer.

These practices can include acts that are

deemed unlawful, such as those that
violate a consumer protection law.

Examples: the false representation of a good or

service; false free gift or prize offers; non-
compliance with manufacturing standards; false
advertising; or deceptive pricing.
 Covid-19
Pandemic
The coronavirus (COVID-19)
pandemic has deteriorated the health
and economic welfare of consumers as
markets have been disrupted.
Consumers were deprived access to
essential goods and services, and
vulnerable and disadvantaged
consumers were severely affected.
Furthermore, a large percentage of
consumers have been the victim of
unfair business practices.
 We will be broadly discussing the following;

Black Marketing and Exclusion of Small

Hoarding of Essential Players from OTA
Commodities Platforms

False advertising for

Legal Remedies
immunity building
Available
products
Black Marketing and
Hoarding of Essentials
• Hoarding behavior, where people collect or accumulate things
such as money or food in excess of their immediate needs, can
lead to shortages, or in the case of hoarding cash, have negative
impacts on the economy and so do the ‘Under The Table’
transactions.

• Even after authorities cautioning the businesses from taking

advantage of the Covid-19 situation, Many essential goods sellers,
owing to panic amongst the public, were keeping their shops
illegally after hours and selling goods at higher prices.

• There were some wholesalers who terminated their contracts for

supplying surgical masks to hospitals in order to sell them in the
open market at higher prices.

• An India Today investigation unearthed a growing black-market

for the antibody-rich plasma of recovered Covid-19 patients.
What is to be done?
Section 3 and 4 of The Competition Act, 2002 clearly prohibit any anti-competitive agreement or
prohibit the abuse of dominant position by any enterprise.

The Prevention of Black marketing and Maintenance of Supplies of Essential Commodities Act, 1980
empowers the government to detain a person who is found to be committing or instigating any offence
punishable under the EC Act, or dealing in any essential commodity to make gain.

It is noteworthy that the act of hoarding, refusal to sell the goods or make them available for sale or to
provide any service with an intention to raise their cost or that of similar goods or services amounts to an
‘unfair trade practice’ and kickstarts the redressal and penal mechanism under CPA 2019.

Under the Act, the district collectors have also been conferred powers akin to that of the Central Consumer
Protection Authority’s. Therefore, the supply chain of essential commodities needs to be wary of the CCPA
and District Collector while conducting their operations during these times.
 False Advertising for products that claim to
fight against Coronavirus
Advertisers today are trying to link their products directly or indirectly to Covid-19 or the
circumstances surrounding it and are blatantly peddling products through false or misleading claims
related to Covid-19. Let’s look at some examples;
 Arihant Mattress- Corona-
Resistant
The Arihant mattress released an
advertisement in a Gujarati
newspaper that went viral on the
social media for its claim that their
mattress was ‘corona-resistant’
Ayush Ayurvedic Treatment
cures Covid 19
There was a news flash with regard
to Ayush Ayurveda products
treating Covid-19 jumping the
bandwagon of finding just any
cure for the disease
Eat Chicken-Beat Corona
The advertisement in question was
taken out by the Karnataka Poultry
Farmers and Breeders Association and
Vencobb. The advertisement claimed
that eating chicken boosts immunity
The Dettol advertisement
Reckitt Benckiser (RB) took out an
advertisement that alleged that its
DETTOL hand wash was more
effective than regular bar soap (shown
as a red bar soap) in preventing the
spread of the Coronavirus.
Section 10 of Consumer Protection Act 2019 :
Establishment of Central Consumer Protection
Authority.
The Central Consumer Protection Authority under the newly
enacted Consumer Protection Act, 2019 is empowered to deal
with all deceptive and false advertisements. On a complaint from
the consumer or the government, consumer courts have the power
to order the withdrawal of advertisements, direct issuance of
corrective advertisements and award compensation to consumers.
Example of Large OTA Platforms indulging in unfair practices;

In an ongoing investigation case in front of CCI, two major players of the hotel industry, FabHotels and Treebo, are arguing for
reversal of their unjust and illegal exclusion from the largest OTA platforms like MMT and Goibibo.
A large player like MMT should rather be offering level-playing field to all the players in such testing time.

Honorable CCI stated that if this

exclusion is the result of agreement
between MMT and OYO, It would
contravene Section 3(4) of the
Competition Act. It is also known that any
discriminatory treatment by a dominant
player to some specific players would also
violate section 4(2) of the act.
 Overvie
w
 Covid-19, other than infecting millions of people all over the world continues to rage havoc in people’s life
by being the catalyst behind a number of unfair trade practices.
 Unethical opportunistic business people have seen the vulnerability of consumers or small business players
as the chance to exploit innocent people and get maximum returns which is why the mentioned unfair
practices are at an all time high currently.
 Thankfully the Competition Act, 2002 and The Consumer Protection Act, 2019 are endowed with suitable
provisions to come to the rescue of the affected people.
 With the right regulations in place, The government just needs to be more proactive than ever so as to be
able to save the victims and punish the exploiters. This will help deter more people from indulging in such
activities.
References
• https://www.barandbench.com/columns/conundrum-of-the-consumers-during-covid-19
• https://www.financialexpress.com/opinion/antitrust-laws-in-the-time-of-covid-19/1928533/
• https://www.aninews.in/news/business/business/unfair-trade-practices-by-large-online-travel-a
gents-could-lead-to-a-loss-of-15000-jobs-and-closure-of-more-than-1000-hotels20201211123
704/
• https://www.indiatoday.in/india/story/exclusive-coronavirus-pandemic-fuels-black-market-for-
plasma-of-recovered-patients-1703332-2020-07-22
• https://www.advayalegal.com/blog/misleading-advertisements-during-covid-19/
 THANK
YOU!
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