CCP issues show-cause notice to 19 top feed companies

ISLAMABAD: The Competition Commission of Pakistan (CCP) has issued a show-cause notice to 19 influential feed companies after finding out alleged involvement into collusive practices, undue profiteering and causing price hike of chicken and eggs in the domestic market.

According to the CCP’s announcement, it has issued show cause notices to 19 feed companies for collusive activities and, prima facie, entering into prohibited agreement in violation of Section 4 of the Competition Act, 2010.

The CCP took a suo motu notice of the concerns and complaints regarding a concurrent increase in feed prices and initiated an inquiry. Data gathered from market sources showed that there was indeed a simultaneous increase in price by poultry feed mills and the average quantum of increase in prices also appeared to be similar, which raised suspicion of collusive decision making and a violation of Section 4 of the Competition Act.

Moreover, multiple sources shared the concerns that some of the top poultry feed mills were meeting at different locations and fixing the feed poultry feed prices. Therefore, exercising its powers under Section 34 of the Competition Act 2010, the CCP on 4 February 2021 carried out search and inspection of two major poultry feed mills based in Rawalpindi and Lahore to impound the proof of their suspected involvement in collusive activities and collective fixing of poultry feed rates. Two authorized teams of CCP conducted the inspections and successfully impounded the relevant record, including computer-stored information.

The impounded record revealed that officials of 19 feed mills were using an active WhatsApp group where one feed producer would announce its intended price increase and the rest expressing and sharing their willingness to follow suit.