The Federal Competition and Consumer Protection Commission (FCCPC) has concluded an investigation into Coca-Cola Nigeria Limited and the Nigerian Bottling Company Limited (NBC), uncovering significant breaches in transparency and consumer communication.
The inquiry, which began in June 2019, focused on the companies’ transition from traditional sugar to non-nutritive sweeteners in their Coke, Fanta, and Sprite brands. This change was not adequately communicated to consumers, according to the FCCPC.
FCCPC management stated, “Our investigation revealed that Coca-Cola and NBC repeatedly violated the Federal Competition and Consumer Protection Act (FCCPA), particularly concerning misleading trade descriptions and unfair marketing tactics.”
The commission found that the companies marketed the “Original Taste, Less Sugar” variant as identical to classic Coca-Cola, despite differences in formulation. This misrepresentation extended to other products, with similar undisclosed changes in Fanta and Sprite.
“By December 2020, we had gathered substantial evidence demonstrating these violations,” the FCCPC reported.
The commission discovered that Coca-Cola and NBC had failed to provide clear and accurate information to consumers, intentionally misleading them about the nature of their products.
Internal documents from the companies further indicated awareness of the ineffectiveness of their product differentiations and continued misleading practices.
The Explainer learned, Coca-Cola and NBC agreed to adopt more transparent product descriptions in an attempt to resolve the matter. However, they later abandoned this commitment, opting for a business strategy that failed to meet regulatory standards.
The FCCPC stated, “This move prompted us to re-engage with the companies, but Coca-Cola and NBC’s efforts remained inadequate despite numerous opportunities to comply.”
On July 29, the FCCPC issued a Final Order detailing its findings. The order highlighted Coca-Cola and NBC’s use of misleading trade descriptions, particularly in the marketing of Coca-Cola Original Taste and its “Less Sugar” variant. The companies were also found to have employed unfair marketing tactics, violating several sections of the FCCPA.
The commission elaborated, “Misleading trade descriptions under Section 116 FCCPA by continuing to mislead consumers to believing Coca-Cola Original Taste is not materially different from Coca-Cola Original Taste ‘Less Sugar.'”
Additionally, the FCCPC noted that NBC misled consumers by using identical packaging for both the Zero Sugar and 50:50 variants of the Limca Lime-Lemon flavoured drink, further contravening regulatory standards.
The FCCPC has reserved judgment on the issue of Abuse of Dominance and the appropriate penalties under the FCCPA and the Administrative Penalties Regulation 2020, which will be imposed in due course.
