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Business Recorder

Published Date: Dec 6, 2012

CCP FOR CREATING AWARENESS ON ILLS OF CARTELIZATION

Chairperson Competition Commission of Pakistan (CCP) Rahat Kaunain stressed the need for introducing a compact academic course on competition law at premier institutions to create awareness about cartelisation and value of free-market economy among future policy makers.

Addressing a seminar on the occasion of the World Competition Day, with the theme, ‘Adverse Impact of Cartels’ here on Wednesday, the CCP Chairperson said that the introduction of academic courses on competition law at leading universities etc will create awareness, and ignite interest, in this particular field of law which has assumed increasing importance in economic regulation.

“It will seek to create a nexus between the competition regime and the academic circles in the country providing sustainable increase in knowledge relating to competition issues,” she added. The World Competition Day has been marked by many competition agencies across the world and the CCP held a seminar for academia and called for co-ordinated efforts to curb cartelization, the most pernicious anti-competitive conduct.

The Chairperson informed the participants that the Commission was currently dealing with several cases, including poultry, entertainment, urea/fertiliser, telecom and aviation sectors. She said that the Commission’s effectiveness and its performance has been internationally acknowledged, adding that as a result of effective enforcement, the Commission got ‘Fair’ rating in independent evaluation by the Global Competition Review (GCR) in 2010 and 2011, and was also shortlisted by GCR for the Enforcement Award in the category ‘Agency of the Year – Asia-Pacific, Middle East and Africa’ for 2012′. They were further informed regarding peer review of the Commission by the United Nations Commission on Trade and Development (Unctad).

The peer review has been requested for and volunteered by CCP and the evaluation will be shared at the next meeting of Unctad expected to be held in July next year which will be presented before 152 countries. The Chairperson said that the peer review is an effort on behalf of CCP for the strengthening of the institution as well as building the image of Pakistan.

The Chairperson reiterated CCP’s commitment to pursue hard core anticompetitive conduct ie, horizontal agreements among competitors not to compete such as price fixing, bid rigging and market allocation. She emphasised that all stakeholders including the government, the business community, judiciary, media, and consumer right groups can play a crucial role to strengthen and help CCP detect cartels and purge Pakistan’s economy of this ‘supreme evil of anti-trust’, as described by the US Justice Department.

The seminar was attended, from the Commission, by Chairperson Rahat Kaunain Hassan, Members Dr Joseph Wilson and Vadiyya Khalil, and from academia by large number of students and faculty members of various universities, ie National University of Science and Technology (NUST), Szabist, Quaid-i-Azam University and Bahria University.

The World Competition Day is marked to commemorate the adoption of the UN Set on Competition Policy on December 5, 1980, which is a multilateral agreement on competition policy that provides a set of equitable rules for the control of anti-competitive practices; recognises the development dimension of competition law and policy, and; provides a framework for international operation and exchange of best practices.

The participants were briefed on the enforcement of Competition Law, with particular focus on Section 4 of the Competition Act, that deals with cartelization. They were informed that the during the last five years, the Commission has moved very decisively against cartelization in various sectors, ie banks, cement, chartered accountancy, stock exchanges, dredging, poultry, telecom, jute, power, shipping, cooking oil and ghee, media.

The Commission has imposed fines of Rs 8.5 billion for different violations of competition law. However, the effectiveness of the Commission’s orders/actions shall be more visible upon disposal of pending cases before the courts. Earlier, CCP Member Dr Joseph Wilson gave a detailed presentation on the Competition Act of 2010. CCP Member Vadiyya Khalil briefed the participants on the advocacy strategy of CCP. The participants took keen interest in the seminar.

At a second seminar on ‘Adverse Impact of Cartels on the Poor’ organised by Sustainable Development Policy Institute (SDPI), Nadia Nabi, Director Enforcement, Competition Commission of Pakistan (CCP) briefed participants on various aspects of cartelisation debate and informed participants that CCP was diligently protecting the rights of consumer by ensuring that anti-competiveness business practice were controlled which mainly entails collaborative price fixation, territory/ customers division, restricting production and collusive tendering.

Citing references, she said that cartels are major drain on economy whose impacts on prices ranging between 10 and 20 percent. Giving details of recent CCP actions, including the CNG issue, Nadia Nabi, added that the commissions inspection teams have recently conducted inspection visit on CNG stations and an enquiry committee has been formed to investigate that whether any malpractices has been done by CNG association on CNG prices . She also added that the committee would also review policy framework on the issue and a policy note would be issued in case one is required.