ISLAMABAD: The Competition Commission of Pakistan (CCP) has started proceedings against 20 sugar mills in the Punjab, Sindh, and the Khyber-Pakhtunkhwa zones, in the matter of alleged cartelization, price fixing of sugarcanes and refined sugar, and territorial allocation for purchase of sugarcane.
It is reliably learnt that the sugar mills that have received the CCP's hearing notices include; in Punjab zone, Indus Sugar Mills Ltd. Hamza Sugar Mills Ltd. Ashraf Sugar Mills Ltd. United Sugar Mills Ltd. JDW Sugar Mills Ltd. Pahrianwali Sugar Mills.; in Sindh zone, Ansari Sugar Mills Ltd. Ghotki Sugar Mills Ltd. Dewan Sugar Mills Ltd. Bawany Sugar Mills Ltd. Al-Asif Sugar Mills Ltd. Naudero Sugar Mills Ltd. Najma Sugar Mills Ltd. Adam Sugar Mills Ltd. Macca Sugar Mills Ltd.; in KP, Chashma Sugar Mills Ltd. Premier Sugar Mills Ltd. Frontier Sugar and Distillery Ltd., and Khazana Sugar Mills Ltd.
Sources told Business Recorder that these are the sugar mills that had not challenged the CCP's show cause notice of 2009, which was issued by CCP to the Pakistan Sugar Mills Association (PSMA) and its 79 member sugar mills for alleged cartelization in the prices and production of sugar, and purchase of sugarcane.
In October 2009, the CCP conducted an enquiry and also raided the offices of the PSMA, where it impounded the proofs of alleged cartelization.
After the enquiry, the CCP bench concluded that the PSMA was involved in collusive practices, and the bench suggested a maximum penalty on the association for violating the competition law.
However, the operation of the order was restrained by the Sindh High Court where the PSMA had challenged the CCP's enquiry.
Similarly, 60 sugar mills that were the members of the PSMA went into writ petition challenging the CCP's show cause notice and constitutionality of the Competition Ordinance. These sugar mills did not file a reply to the CCP's show cause notice.
The abovementioned 20 sugar mills, however, filed replies to the CCP's show cause notice. Sources informed that the CCP has filed applications in the courts to vacate the stay orders against its show cause notices of 2009.
As a result of the Sugar Commission Report that was made public by the PTI government, a reference has been sent to the CCP for investigating alleged cartelization in the sugar industry.
The CCP cannot proceed with a fresh inquiry as the Islamabad High Court, though a stay order has restrained the government from acting against the PSMA or the sugar mills on the recommendations of the Sugar Commission Report.
However, the CCP has decided to proceed against the said 20 sugar mills on the basis of show cause notice issued to them in 2009. Sources informed that the CCP is conducting day-to-day hearings in the matter, and an order will be issued after hearing the sugar mills.
Sources informed that on the directions of the prime minister, the current chairperson of CCP Shaista Bano Gillani is actively pursuing the pending court case in Islamabad and Lahore High Courts. The Lahore High Court has fixed the hearings in the constitutionality case of Competition Act, 2010, while the Islamabad High Court has also resumed hearings in a similar case of constitutionality.
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