CCP virtually defanged without key appointments

ISLAMABAD: Fair trade watchdog Competition Commission of Pakistan (CCP) has been wallowing without its key members for the last couple of months to execute penalties against the perpetrators of deceptive marketing, sources said on Wednesday. 

Currently, only two members – Vadiyya Khalil, the commission’s chairperson and member Ikramul Haque Qureshi – are implementing the provisions of the Competition Act 2010, the sources added. 

Member Joseph Wilson completed his job terms in November 2016, and two other members Mueen Batlay and Shahzad Ansar ended their job tenures in January this year, thus vacating the positions to be filled through a competitive process.

Officials said the senate standing committee on finance, headed by senator Saleem Mandviwalla, will discuss the issue in a meeting scheduled for Thursday (today) and it will inquire the finance ministry’s high-ups about the reasons behind lacklustre attitude of top guns and their dillydallying tactics in making key appointments into CCP.

Under Section 14 of the Competition Act, the commission will consist of not less than five and not more than seven members. Under the Competition Act, a member is appointed for a term of three years, which is extendable for a final three-year term, after which the position has to be advertised to appoint new member through competitive process.

Officials said the process to appoint members is underway. The position of one member was advertised on 18 December, 2016 while advertisement for two other members was published on 26 February, 2017.

Although the law authorises the commission to take action against companies involved in unfair trade practices, the two- member commission find it difficult to exercise power due to lack of quorum.

Under Section 37 (2) of the Competition Act, the commission can conduct enquiry on formal complaints received from undertakings, issue show cause notices, hold hearings and pass orders.

Meanwhile, CCP on Wednesday issued another show cause notice to a frozen foods manufacturing company Kitchen Stone Foods for prima facie violation of Section 10 of the Competition Act 2010 by running deceptive marketing campaign for its frozen food products. The commission received complaints that the said company was deceiving consumers by claiming that its products were 100 percent non-processed food.

CCP conducted an inquiry into the matter, which concluded that the advertisement posted by Kitchen Stone Foods on its Facebook page drew a misleading comparison by showing the complainants’ packaging with articles citing risks and causes of cancer along with misleading narrations without substantiation.

Since January, CCP has initiated 16 enquiries for violation of Section 3, 4 and 10 of the Competition Act and 23 show cause notices are ready to be issued shortly. The commission held 33 hearings and issued two orders. Nevertheless, the commission has cleared 34 mergers and granted 20 exemptions in the same period.

Since January 2015, the commission held 92 hearings, conducted 26 enquiries, passed 23 orders, approved 179 mergers and issued 159 exemptions. On the advocacy front, CCP has held 17 seminars at the universities across the country to introduce the module on economics and competition law that it has developed in collaboration with the Kings College London, to the students and faculty of management sciences, economics and law. As part of the academia drive, seven seminars were held during November-December.

Though the commission continues to focus on both enforcement and advocacy, yet the lack of quorum precludes it from exercising suo motu powers under Section 37(1) and holding the commission’s meeting to discuss policy and operational matters, said the sources.