ISLAMABAD: The Competition Commission of Pakistan (CCP) has imposed an aggregated penalty of Rs 265 million on two cable companies for engaging in Resale Price Maintenance (RPM) practices in violation of Section 4 of the Competition Act, 2010.
The CCP has imposed a penalty of Rs 75 million on Newage Cables (Pvt) Ltd and Rs 190.22 million on GM Cables & Pipes (Pvt) Ltd.
The Commission conducted an enquiry upon receiving information, supported by documentary evidence, including policy circulars issued by the respondents. These circulars contained instructions restricting dealers from offering discounts beyond specified limits and prescribed punitive measures, including termination of dealership agreements, for non-compliance.After its initial probe, the Commission authorised an enquiry under Section 37(1) of the Act. The enquiry concluded that the respondents had prima facie violated Section 4 of the Act by imposing minimum resale price restrictions on their dealers. The enquiry found that Newage’s retail discount policy and dealership agreements prohibited dealers from selling products below prescribed discount levels, while GM Cables imposed similar restrictions through its rate control notices and related communications.
On enquiry committee’s recommendations, the Commission issued show cause notices to both undertakings for their alleged conduct restricting intra-brand price competition through vertical agreements establishing minimum resale prices. After hearing the parties and conducting a detailed analysis of the evidence, the Commission concluded that both undertakings had engaged in RPM practices constituting a restriction “by object” under Section 4 of the Act. In its order, the Commission observed that the respondents’ conduct eliminated intra-brand price competition and adversely affected consumer choice. The practices were formalized through circulars, widely disseminated across dealer networks, and enforced through coercive measures, including threats of suspension or termination.
Taking into account the nature, gravity, and duration of the violations, the Commission observed that Newage Cables demonstrated a cooperative approach during the proceedings, whereas GM Cables continued its infringing conduct even after initiation of the enquiry and attempted to deny documented evidence. Accordingly, the Commission imposed a penalty of PKR 75 million on Newage Cables (Pvt.) Ltd. and a penalty of 5 percent of annual turnover for FY 2023–24, amounting to PKR 190.22 million, on GM Cables & Pipes (Pvt.) Ltd.
Copyright Business Recorder, 2026
Comments