Wednesday June 12, 2024

Consumer prices to drop 25-30pc if cartels busted: CCP

By Our Correspondent
June 18, 2022

KARACHI: Competition Commission of Pakistan on Friday said if the cartlisation activities are brought to the book effectively, the consumer prices can reduce significantly.

“The CCP is not against businesses, rather the Competition Law is pro-business and pro-growth; however, without strict enforcement of the law, a competition culture could not prevail,” said Rahat Kaunain Hassan, chairperson CCP, during an advocacy session at Karachi Chamber of Commerce & Industry office.

She said as per OECD reports/estimates, prices could go down 25-30 percent if cartels were busted.

The KCCI raised different issues with the CCP authorities in an advocacy session, which was attended by President KCCI Muhammad Idrees, Vice President KCCI Qazi Zahid Hussain, KCCI Managing Committee Members, and CCP Chairperson Rahat Kaunain Hassan, Member Mujtaba Ahmad Lodhi, and Director Generals Noman Laiq, and Asfandyar Khattak.

The KCCI sought CCP’s help in creating a level playing field and removing entry barriers in the different sectors.

Rahat Kaunain Hassan said the CCP had imposed penalties of up to Rs70 billion for different violations of the Competition Act on various sectors.

“However, the recovery remains paltry due to the fact that most of the undertakings have challenged the CCP’s orders in the higher courts where the due process of judicial review is underway,” the CCP official said.

“The real effectiveness of the CCP’s orders will be felt once the judicial review process is complete, particularly in the cartel cases, that call for prioritization for the harm it incurs to the economy”.

The chairperson further said that as an institution, the CCP was accountable for its mandate, but in the pending cases the review process had to take its course.

She added that as against the general impression, the CCP was not a price regulator, but it only intervened where the prices of goods and services were affected by anti-competitive practices such as abuse of dominance and cartelisation.

“The main job of CCP was to make sure that markets were functioning in compliance with the competition rules and regulations.”

During the session, members of KCCI brought several issues and competition related matters to the CCP’s notice.

The chairperson offered to amend the CCP regulations to waive the fees for the members of the chamber for filing formal complaints for resolving competition issues.

She informed that the informant reward scheme and leniency provisions were available, which the business community could benefit from and help the CCP in identifying the anti-competitive issues. She assured the CCP’s full support in resolving the competition issues and creating a level playing field.

Earlier, President KCCI Muhammad Idrees, said the CCP undoubtedly played an important role in providing equal opportunities and a level-playing field to the business and industrial community and the efforts being made by the Commission had led to not only improve the business climate to a certain extent but also ensured that public was saved from unlawful profiteering, counterfeiting and sub-standard products.

Appreciating some of the major actions taken by CCP, he particularly mentioned that CCP took notice of unusual rise in prices of edible oil in 2020 and initiated inquiry against 110 edible oil companies that would help in stabilising prices of this essential household product.

He also mentioned Sindh High Court’s recent order to Pakistan Sugar Mills Association (PSMA) and 26 other producers to deposit 50 percent of respective penalties, for grant of interim relief and suspension of CCP’s order that imposed around Rs44 billion on the industry in cartelisation case.