CCP Searches Pakistan Association of Violations Offices of Vanaspati Manufacturers

In 2010, the Competition Commission of Pakistan (CCP) examined the offices of Pakistan Vanaspati Manufacturers Association (PVMA) in Islamabad, Lahore and Karachi as part of the investigation into suspected violations of sections 3 and 4 of the Competition Act in 2010.

The inspection of seized papers and computer storage material relating to the alleged participation of the PVMA in anti-competitive actions has been conducted in accordance with Article 34 of the Law.

Three teams of licenced police caught significant evidence and searched the facilities of the PVMA. After signing the inventory details, the PVMA officials cooperated completely with the search teams, and gave the necessary papers and computer stored information.

The CCP Committee of Enquiry stated during the investigation that the PVMA was an association of 125 food-production petroleum and ghee manufacturers, and, as reported by media reports, the collective pricing of various cooking oil and Ghee brands for the various market segments seemed to be part of.

The committee data also showed that PVMA transfers freight costs amongst its member mills / firms, often revising these rates on the basis of higher/lower pricing for HS Diesel (HSD). Substantial infringement of Section 4 of the 2010 Competition Act seems to be the thinking at PVMA level.

From the supposed anti-competitive activity of the PVMA it seems that its platform is utilised to decide collectively on the pricing of oil/ghee and its cost components. However, such commercial tactics are prohibited under the Competition Act.

The record with the Committee of Inquiry can demonstrate the alleged participation of PVMA and other undertakings in the recent rise in food and ghee pricing.

The CCP must promote free competitiveness, including the price setting for vital commodities, in all areas of economic and commercial activity to increase economic efficiency and to safeguard the consumer from anti-competitive conduct.

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