The cartels in cement, automobile and sugar industry are fleecing consumers worth billions of rupees and have taken refuge under the court stay orders to avoid action by the CCP. It is unclear just how effective CCP is in pursuing vacating stay orders in various courts. Business Recorder waited for the response of the CCP spokesman for two days but he did not respond despite promise.
Sources said that CCP has imposed a fine of Rs 140 million to automobile industry, Rs 6.402 billion to cement industry while the sugar industry owners had got stay order from the court prior to passage of any adverse decision by the CCP. The Commission has been enquiring and investigating into possible violations of the Competition Act 2010 by the companies in all sectors of the economy including Cement, Sugar and Automobile.
The CCP took action against and imposed a fine of Rs 140 million on Pakistan Automobile Manufacturers Authorized Dealers Association (PAMADA) and its members for involvement in price fixing of auto parts etc. Action was also taken against a car manufacture for abuse of its dominant position with respect to booking orders; however, the matter was disposed off after the company agreed to revise the terms of its booking in compliance with the Act.
The cement industry is a powerful cartel as a case against All Pakistan Cement Manufacturers Association has been pending since 2009. The industry was fined to the tune of Rs 6.402 billion after the APCMA was found to have fixed the price. However, the APCMA challenged the constitutionality of the CCP and the matter is pending adjudication before the Lahore High Court. Pakistan Sugar Mills Association members got stay order from Sindh High Court against the CCP order since 2010
According to official website of the CCP, it conducted around 73 inquiries and passed orders in 88 cases of anti-competitive behavior. Since 2007, the CCP has imposed penalties close to Rs 27 billion on companies and associations for abuse of dominant position and prohibited agreements or cartelization as well as deceptive marketing practices. The highest ever penalty was imposed on the telecom sector of approximately Rs 9.5 billion, followed by fertilizer of approximately 8.6 billion, and cement of approximately Rs 6.4 billion.
Penalties imposed on other sectors include Rs 975,000,000 in banking & finance, Rs 468,038,448 in oil & gas, Rs 450,000,000 in healthcare, Rs 211,000,000 in ports & shipping and Rs 150,000,000 in poultry. Similarly, an aggregate figure of Rs 349,190,000 included penalties imposed in FMCG, insurance, securities, education, packaging, aviation, edible oil, accountancy, steel, power, courier services, paint, and retail sectors. The Competition Appellate Tribunal established under the Competition Act to hear appeals against the orders of CCP has actively taken up the appeals and passed judgments in various appeals in favour of CCP.
Copyright Business Recorder, 2017