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Tag: Competition Commission of Pakistan

  • Investigation launched against 88 housing schemes

    Investigation launched against 88 housing schemes

    ISLAMABAD: Competition Commission of Pakistan (CCP) has initiated investigation against around 88 housing schemes for deceptive marketing practices.

    In a statement on Monday, the CCP said that it had launched the enquiry while taking notice of the widespread concerns and complaints regarding the prima facie deceptive market practices by various housing schemes in Punjab.

    The CCP said that the Lahore Development Authority (LDA) informed through a letter that 88 housing schemes in Lahore and its adjacent district of Kasur, Sheikhupura and Nankana Sahib were luring investors and the general public through print and TV advertisements to invest in their schemes, without meeting the legal requirements and in violation of the pertinent laws.

    The LDA has sought a ban on the advertising campaign of these schemes to save the citizens from financial losses.

    The CCP took suo moto notices and authorized an enquiry team to thoroughly probe the housing schemes and submit the report to the Commission.

    As part of the investigation the team had visited 62 housing schemes to see the situation on ground and was scheduled to visit the remaining housing schemes.

    The team also met the Director General LDA and other concerned officials to enlighten itself about the pertinent issues and explore the ways to cooperate and coordinate in the areas of shared interests.

    The CCP said that Section 10 of the Competition Act prohibits businesses from indulging in deceptive market practices, which also include the distribution of false or misleading information lacking reasonable basis, deceiving the consumers, and harming the business interest of the other undertakings.

    If the violation of Section 10 is proved against the housing schemes, the CCP may issue show cause notices to them, according to the statement.

    The CCP is mandated under the Competition Act to ensure free competition in all spheres of commercial and economic activity, to enhance economic efficiency and to protect consumers from anti-competitive behavior including deceptive market practices.

  • CCP imposes penalty of Rs75 million on flour mills association for anti-competitive activities

    CCP imposes penalty of Rs75 million on flour mills association for anti-competitive activities

    ISLAMABAD: The Competition Commission of Pakistan (CCP) has imposed a penalty of Rs75 million on Pakistan Flour Mills Association (PFMA) for providing a platform to share commercially sensitive information and fixing the quantities of production of wheat flour.

    The commission took the notice on reports suggesting unusual price hike of wheat flour or wheat atta across Pakistan and carried out raids on PFMA premises.

    “The enquiry in the matter concluded that PFMA is providing a platform to its members for settling of prices of wheat flour to avoid any form of competition which is in violation of the laws.”

    After hearing the parties, the CCP’s bench comprising of the Chairperson Ms. Vadiyya Khalil and Members Dr. Muhammad Saleem and Dr. Shahzad Ansar passed the order.

    The commission observed that under Article 38 of the Constitution the State is responsible to ensure the provisions of food and basic necessities at fair prices along with social and economic benefits to its citizens.

    Accordingly, Provincial Food Departments set a maximum cap of the wheat flour price under the Foodstuffs (Control) Act, 1958; as wheat is Pakistan’s dietary staple and used by consumers belonging to all socio-economic groups.

    The wheat flour currently contributes 72 percent of Pakistan’s daily caloric intake with per capita wheat consumption of around 124 kilograms per year, one of the highest in the world.

    The commission observed that having a maximum cap in the essential food item benefits the consumer to bargain for a lower price and prevents retailers from overcharging consumers. This also enables retailers to discount the product in order to increase their sale.

    “PFMA in complete derogation of the aforesaid objective, deliberately fixed the rates of wheat flour by conducting meetings and discussing the prices as well as the quantities to be produced and supplied by flour mills in violation of Section 4 of the Competition Act.”

    The CCP also observed that discussion, deliberation and decision regarding purely business concerns like current and future pricing, production and marketing are anti-competitive and should be avoided at all costs by the association.