CCP 2019 order: Appellate Tribunal grants partial relief to flour mills, upholds Rs35mn fine

The Competition Appellate Tribunal (CAT) upheld the order of the Competition Commission of Pakistan (CCP) against the Pakistan Flour Mills Association (PFMA) for “fixing the price of wheat flour”. However, the CAT reduced the fine amount to Rs35 million from previously Rs75 million the CCP had imposed in its 2019 order, according to a CCP statement on Tuesday.

In 2019, the CCP had noted that the PFMA had been involved in fixing the wheat grinding quota for each member mill, which led to an increase in flour prices across the country.

The PFMA later challenged the CCP order before the CAT.

According to CCP’s Tuesday statement, CCP’s counsel argued in court that Sections 4(1) and 4(2)(a) of the Competition Act, 2010 prohibit any agreement or decision between undertakings, including associations, aimed at fixing prices.

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“The CCP maintained that the repeated and structured issuance of price instructions by PFMA displaced the commercial autonomy of individual mills, constituting a horizontal agreement with an anti-competitive object.”

After hearing arguments from both sides and examining the record, the tribunal upheld CCP’s findings but reduced the penalty to Rs35 million.