Financial Daily from THE HINDU group of publications
Thursday, Jun 13, 2002
Financial Daily from THE HINDU group of publications Thursday, Jun 13, 2002 |
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Marketing
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Regulatory Bodies & Rulings MRTPC issues notice to LG Electronics Our Bureau
NEW DELHI, June 12 THE summer heat seems to be catching up with the Korean consumer durable company LG Electronics India Ltd. First it was the controversy about the company misrepresenting its market shares and now complaint of the company overstating its product capacity. The Monopolies and Restrictive Trade Practices Commission (MRTPC) has issued a show-cause notice to LG Electronics India on the charges of unfair trade practices by two major refrigerator manufacturers -- Whirlpool of India Ltd and Godrej Appliances Ltd -- and a consumer. As per the two petitions filed today by Whirlpool India and Godrej Appliances, LG Electronics is misleading the consumer by over claiming the capacity by 11-14 per cent on its frost-free models where the Bureau of Indian Standards (BIS) allows only three per cent variation on the declared capacity. According to the petitioners, as per the test conducted through an independent government agency, Central Power Research Institute (CPRI), Bangalore, LG 230-litre refrigerators measures up to 202 litres, 250 litres as 225 litres and 280 litres as 254 litres only. In India, BIS has laid the specifications for domestically manufactured refrigerators. Its standards prescribe the general constructional requirements of refrigerators, as well as methods of computing the volume of such refrigerators, the petitioners submitted. As per the specifications laid down by BIS, the measured gross volume of a refrigerator (the actual volume as measured in the laboratory) should not be less than ''the rated gross volume'' (the volume stated by the manufacturer) by more than three per cent. This would mean that if a manufacturer claims that his refrigerator is of 100 litres, the actual testing of such a refrigerator should not be less than 97 litres, the petitioners stated. The tests were conducted by the CPRI during April and May 2002. For the purpose of promoting the sale, use and supply of its refrigerators, LG has adopted an unfair method by representing the capacity of its refrigerators to be much higher than what they actually are, the petitioners said. The case is now fixed for hearing on July 3. Meanwhile, when contacted the LG Vice-President, Sales and Marketing, Mr Pradeep Tognatta, said, "It is just a complaint that has been filed against us. Since there is time before the next hearing, we will get our refrigerators tested by a proven laboratory before making any final comments.''
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