Legal protection against Unfair Competition In India
A act or practice in the course of industrial or commercial activities contrary to honest practices constitutes an act of unfair competition; which is against “contrary to honest practices”.
Behaviour classified as unfair competition:
To prevent unfair practice certain actions are limited by law. Unfair business practices into three broad categories:
Acts causing confusion:
- A practice or act or activity which results or is likely to cause confusion with respect to another’s enterprise or its activities, in the products or services offered by such body constitutes an act of unfair competition.
- Like a trademark, if registered or not, or a product’s appearance may lead to confusion by its packaging, shape or other non-functional characteristic features.
Acts those are misleading:
- A misleading act can create a false impression of a competitor’s product or services.
- This may also result to the consumer, acting on false information, suffering financial damage.
Acts damaging goodwill or reputation:
- Reducing the appearance, value, distinctive character or the reputation attached to a product could damage another’s goodwill or reputation.
- Like any act that dilutes the effect of a trademark is considered unfair as it could destroy the originality and distinctive character of a trademark.
Protection against unfair competition:
- The Minister may by legislative instrument make Regulations for the effective implementation.
- A person who is damaged or considers that he is likely to be damaged by an act of unfair competition may bring an action for:
- a provisional order to prevent unlawful acts or to preserve relevant evidence;
- an order of injunction to prevent the act or further acts of unfair competition;
- the award of damages as compensation;
- any other remedy as the court may consider fit to order.
Re Lakhanpal National Ltd. v. MRTP Commission
It was held that the representation that NOVINO batteries are manufactured in joint venture or in collaboration with National Panasonic is false and misleading where appellant company was manufactured NOVINO (dry cell) batteries in collaboration with M/s. Mitsushita Electric Industrial Company of Japan, and not with National Panasonic of Japan using their techniques, as advertised by it.
Re Bombay Tyres International Limited
In this the respondent company was supplying tyres to TELCO under the brand name ‘modistones’ which, however, were not manufactured by it, but by Modi Rubber Limited at Modipuram. But the commission holding that no UTP was involved closed the enquiry.
Re Glaxo Ltd and Capsulation Services Ltd
In the course of the inquiry it was found:
- The said drug was manufactured and packed by Capsulation on the basis of technical know-how supplied
- As per its quality control standard
- product was not an inferior product.
- The price of this drug compared well with similar products manufactured by other leading pharmaceutical manufacturers.
The commission held that the ingredient of loss or injury being absent, even though the impugned practice may fall under one or more clauses of Section 36 A of the MTRP Act, it is not an unfair trade practice.