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CCP imposes Rs15m penalties on three real estate developers

CCP imposes Rs15m penalties on three real estate developers

ISLAMABAD: The Competition Commission of Pakistan (CCP) has imposed Rs15 million penalties on three real estate developers for engaging in deceptive marketing campaigns for their respective housing schemes.

The CCP has passed three orders imposing penalties of Rs2.5 million each on Eden Builders (Pvt.) Limited and Green Field Developers (Pvt.) Limited and Rs 10 million on Vision Developers (Pvt.) Limited for the violation of Section 10 of the Competition Act, 2010.

Green Field Developers marketing campaign for its housing scheme, ‘Green City,’ made the false claim that it was located in Islamabad whereas it was in Fateh Jang. Moreover, by affixing logos of various governmental bodies in its advertising campaigns without obtaining the necessary approvals to do so, Green Field Developers was distributing misleading information.

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.

A Lahore-based real estate company, Vision Developers, had obtained the approval of the Lahore Development Authority (LDA) for a housing society, “River Edge Housing Scheme.” The company subsequently applied for NOC from the LDA for a new housing scheme, “Park View Villas”, which was denied by LDA for being located close to a riverbank, which could be prone to flooding. Despite this, Vision Developers advertised the new unapproved scheme under the deceptive name of “Park View Villas at River Edge Housing Society,” giving the impression that the new scheme was an extension of the earlier-approved “River Edge Housing Scheme.”

Eden Life and Green Field gave commitments to the Commission not to engage in deceptive marketing practices again. Vison Developers, however, never appeared before the CCP despite repeated notices being served to it.

CCP 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.