ISLAMABAD: The Competition Commission of Pakistan (CCP) is strictly monitoring the ongoing sugar “crisis” in the country. If any indications of anti-competitive activities are found, the CCP will take appropriate enforcement and policy actions, the CCP added.
It is important to highlight that the CCP carried out dawn raids on the Pakistan Sugar Mills Association (PSMA) in 2021 and imposed substantial penalties of Rs 44 billion on PSMA and its member sugar mills for cartelisation.
However, the CCP’s decision was appealed against in the High Courts of Sindh and Punjab, and in Competition Appellate Tribunal (CAT) and recovery of penalties has been stayed.
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The Appellate Tribunal is dysfunctional since 14th July 2023 due to expiry of term of its chairman whilst cases of sugar mills and similar important cases are pending. It is important to note the CAT has been dysfunctional for 7.5 years since 2010 leading to a huge backlog of cases. The sooner the government appoints its chairman, the quicker the Appellate Tribunal can finalise the appeals.
The CCP has taken proactive measures against cartelisation in the sugar sector, demonstrating its commitment to ensuring fair competition. Whilst the CCP acknowledges the due legal processes associated with judicial review, expediting the resolution of cartel cases is crucial for delivering effective relief to consumers. Protracted delays in resolving cartel cases will negatively impact both consumers and the overall economy.
Sources told Business Recorder that in 2009, the CCP after concluding an enquiry against the PSMA for cartelisation suggested imposition of maximum penalty on the PSMA. But the PSMA took a stay order from the Sindh High Court (SHC). The SHC also restrained CCP from making the order public.
The CCP has been an open advocate for opening the sugar sector to competition and ending the government role in this sector as well as other sectors of the economy.
It is important to realise that cartelisation, market abuse, and abuse of dominance prevents new entrants in the industry and discourages foreign investment. The lack of competition results in higher prices for consumers.
The CCP is fully cognisant and vigilant in safeguarding consumers and promoting fair competition.
Copyright Business Recorder, 2023