ISLAMABAD: The Competition Commission of Pakistan (CCP) is diligently focusing on enforcement and policy actions, especially in sectors directly impacting consumers such as ghee and cooking oil, sugar, and wheat, to combat anti-competitive activities.
A recent landmark decision by the Supreme Court of Pakistan has paved the way for the CCP to reinitiate investigations in the ghee and cooking oil sector.
Over the past two years, the commission has levied cumulative penalties totalling approximately, Rs45 billion against cartels. However, it is worth noting that many of the CCP’s orders have faced legal challenges in courts.
Despite concerted efforts by vested interests and cartels to delay enforcement through court-issued stay orders, the CCP has taken a record number of enforcement actions. This includes the completion of 37 inquiries, the initiation of 38 new inquiries, and the issuance of 15 orders against 134 undertakings, resulting in total penalties of around Rs45 billion during the last two years.
Cartels, in an attempt to obstruct the recovery of penalties, continue to challenge the CCP’s orders in courts and obtain stay orders on specific inquiries.
Sources have indicated that the new leadership at the CCP, under the guidance of Chairman Dr Kabir Ahmed Sidhu, is determined to rigorously enforce the law and diligently pursue pending court cases.
The CCP’s core responsibility is to promote competition and rectify anti-competitive behaviour, a role it continues to fulfil without interruption. The commission, in line with its mandate under the Competition Act, 2010, has persisted in its efforts to enforce penalties against vested interests and cartels, despite their efforts to delay enforcement through court-issued stay orders.
Over the past two years, the CCP has taken substantial enforcement actions in various sectors, including sugar, cement, cooking oil and ghee, poultry, automobile (including tractors), paint, lubricants, real estate, steel, fast-moving consumer goods, milk, food and beverages, electronic goods, glass, and e-commerce.
In the realm of cartels and trade abuse, the CCP has initiated 22 new inquiries, concluded 14, and issued five orders against 93 undertakings. The most significant penalty, amounting to Rs43.59 billion, was imposed on the Pakistan Sugar Mills Association and its 84 member sugar mills, while Haier Pakistan (Pvt) Limited faced a fine of Rs1 billion for downstream cartelization.
Regarding deceptive marketing practices, the CCP concluded 23 inquiries and initiated 15 new ones. In addition, the commission issued two policy notes on the sugar and wheat sectors to the government during the same period.
The CCP’s enforcement work involves a comprehensive legal process, from the commencement of inquiries to the issuance of orders.
During this period, the CCP issued 175 show cause notices to undertakings, granting them a full opportunity to present their case. In 10 inquiries, the CCP also conducted searches and inspections at various undertakings’ premises.
During this time, the CCP approved 171 mergers and acquisitions in phase 1 and three in phase 2. Additionally, it granted 131 exemptions under the law and continued advocacy initiatives to raise awareness while conducting capacity-building programs for its employees.
As part of its mandate to review policy frameworks, the CCP’s draft pilot study on the “Assessment of Supply Chain from Farm Gate to Retail” recommends policy measures to enhance economic efficiency and eliminate distortions in the supply chain of essential commodities. Similarly, its report on the SME sector will offer recommendations for improving the economic efficiencies of SMEs.
Consultative sessions have begun on the CCP’s draft “E-Commerce Policy Guidelines,” and the pilot study for deliberations with stakeholders.
Furthermore, several policy and research initiatives are in various stages of completion, sources added.
Copyright Business Recorder, 2023
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