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Success Case: Defending Corporate Reputation

By: Ab.Jhon Mora

Head of the Competition Department

 

In the competitive world of business, defending a company's reputation and success becomes an essential crusade. We take great pride in sharing a triumph in the defense of one of our clients against the Superintendency of Economic Competition (SCE) in a case of unfair competition related to food products.


Our legal strategy, led by Dr. José Meythaler and Abg. Jhon Mora, discredited accusations lacking solid evidence, preserving the integrity of our client's product and the required quality standards.

The resolutions achieved in this case set significant precedents for future unfair competition litigation and emphasize the need for specialized guidance.


In this newsletter, we will summarize the key aspects of the case, legal implications, our legal strategy, and the competition authority's verdict:


Key Aspects of the Case

A complaint was filed against our client before the Superintendency of Economic Competition (SEC), alleging unfair practices that included deceiving consumers, exploiting their lack of knowledge, and violating regulations related to food products. The complainant claimed that these practices aimed to distort competition and harm consumers.


Legal Implications: Standards and High Penalties

According to the Regulation and Control of Market Power Code (RCMPC), unfair competition conduct that may affect consumers is considered a minor offense, punishable with fines of up to 8% of the total income of the offender in the year preceding the imposition of the penalty, or 50 to 2,000 Basic Salaries (BS) if quantification is not possible.


Furthermore, the RCMPC classifies the distortion of competition through unfair practices as a serious offense, punishable with fines of up to 10% of the total income of the offender in the year preceding the penalty's imposition, or 2,001 to 40,000 BS if calculation is not feasible. As a result, complaints of unfair competition to the SEC pose significant challenges for companies.


Legal Strategy and Achievement

We developed a robust strategy that included timely responses to the National Superintendency of Investigation and Control of Unfair Practices (NSICUP) to refute the complainant's accusations. We conducted a detailed analysis of national and international precedents, arguing against the lack of solid evidence and the lack of credibility in the complaint. We also questioned the integrity of the chain of custody of the presented evidence.


Competition Authority's Decision

Our defense was successful, as both the NSICUPand the SEC concluded that there was insufficient evidence to support the complaint. They recognized that our client's product met the standards and that no acts of deception or violations of regulations justifying sanctions had occurred.


One of the essential elements contributing to our success was demonstrating that the evidence presented by the other party could not be considered valid because its integrity and control were not adequately maintained. In other words, it could not be ensured that this evidence had not been altered or manipulated from the moment it was obtained until its presentation in the case. This weakness in the chain of custody of the evidence was a decisive factor in the favorable resolution of our case.

 

At Meythaler & Zambrano Abogados, we reaffirm our commitment to our clients, offering high-quality services and defending their interests in the field of business law. This success reflects our dedication and experience, reinforcing the trust that our clients place in us.


If you need legal advice on competition-related matters, please do not hesitate to contact us via email at info@lmzabogados.com.

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