'Monopoly Control Authority needs restructuring'

The Monopoly Control Authority (MCA), in existence since 1970, needs to be restructured for effective delivery of its basic objectives. Former finance secretary Ghafoor Mirza in a detailed presentation on his report relating to monopolies, cartels, restrictive trade practices told a workshop recently that persons with relevant qualifications and experience need to be appointed at senior positions to prevent undue concentration of monopolies, formation of cartels and unreasonably restrictive trade practices.
Of the 22 posts in grade 17 to 22, on the technical side 11 are lying vacant. Chairman MCA has the support of only two members to carry out the functions of the authority. One is responsible for legal & administration matters, while the second is responsible for research and investigation as compared to common four divisional hierarchies.
MIS section under member (legal and admin) has four posts while on ground there is only one programmer. There are six posts for registration organisation, undertakings and individuals. Four of these six posts are vacant. There is no officer in BPS-20 under member legal and admin (ie chief MIS and registrar). While member (research & investigation) has no economist to support him, as the position is vacant. Appropriate professionals need to be appointed by offering them attractive pay package to help transform the authority into an effective enforcement institution.
Internationally a four divisional hierarchy is usually followed for enforcement agencies like MCA, with separate personnel in each division/department. In Pakistan, MCA is working with two divisional hierarchies reporting to chairman and these two departments are also not enjoying their full strength.
Regarding the functioning of Monopolies and Restrictive Trade Practices Ordinance, 1970 (MRTPO), Ghafoor Mirza said that MCA despite its limitations had done some useful work in identifying monopolies and cartels in various industrial sectors.
MCA HAS TAKEN REGULATORY ACTION UNDER THE RELEVANT PROVISIONS OF THE LAW IN THESE SECTORS NAMELY:
a)Fertiliser (urea) (Fauji Fertiliser Company Ltd).
b) Tea, toilet soap and ice cream (Lever Brothers Pakistan Ltd).
c) Soda ash and PTA (ICI Pakistan Ltd).
d) Polyester staple fibre (Dewan Salman Fibre Ltd and Ibrahim Fibre Ltd).
e) Tractors (Al-Ghazi Tractors Ltd).
f) Automotive batteries (Exide Batteries Ltd).
g) Packetted biscuits (English Biscuits Ltd and Continental Biscuits Ltd).
h) Mineral bottled water (Nestle).
i) Compressors (Pakistan Electronics Ltd).
j) Cigarettes (Lakson Tobacco Company Ltd).
k) Septran and Ventoline (Glaxo SmithKline).
l) Jute (Thal Jute).
SIMILARLY, CARTELS WERE IDENTIFIED IN THE FOLLOWING INDUSTRIAL SECTORS AND THE AUTHORITY TOOK REMEDIAL ACTION UNDER THE LAW:
i) Cement.
ii) Polyester staple fibre.
iii) Sugar.
iv) Ghee/cooking oil.
v). Cigarettes.
GHAFOOR MIRZA THEREFORE RECOMMENDED:
-- The organisation required to be restructured through appointment of professionals with attractive pay package.
-- MCA needs to maintain a close watch on prices by maintaining a database so that it can take appropriate action within the scope of the MRTPO.
-- MCA had exercised its power in 1998 to break the collusive arrangement between cement makers, but it was not a successful attempt, partly due to weak enforcement of the writ of law. The law therefore requires amendment to ensure compliance by all concerned.
-- Consumers are not fully aware of MCA's role and its responsibilities.
-- Reporting procedure of MCA is not compatible with other countries.
-- MCA recommendatory role for government is not appropriately exercised as required under MRTPO.
In his presentation Ghafoor Mirza observed that unfortunately privatisation process in Pakistan has in many cases replaced state owned monopolies with private ones with no net benefits to the consumers. This issue needs to be addressed through appropriate amendment in the law.