2023 CLD 64 COMPETITION COMMISSION OF PAKISTAN

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VS S. 11---Merger, approval of---Scope---Applicants jointly submitted an application concerning their intention of creating a joint venture company---Partner 1 was a glass manufacturer, which distributed and exported float glass, tableware, container ware and opal glass---Partner 2 was involved in the business of polyester staple fiber, soda ash, chemicals, pharmaceuticals, nutraceuticals, animal health products and agri-science---Partner 1 was a dominant player in the relevant market i.e. float glass---Partner 2 was a dominant player in the upstream soda ash (an essential ingredient for production of float glass) market---Commission observed that certain issues might arise concerning the subject transaction, such as; subject transaction might put partner 2 in a position in which it could set preferential prices/terms of its business dealings with partner 1; partner 2 might also impose exclusionary terms of sale where the float glass manufacturers might be foreclosed from purchasing soda ash from other sources; and both partners could agree on customer/territorial restrictions related to the sale of float glass, fixing or setting the quantity of production, limiting technical development and/or investment---Commission upon detailed review/perusal of the material, documents and facts on record found that partner 2 might have less incentive to take part in any anti-competitive conduct as its sales of soda ash did not account for a substantial part of its turnover and such sales were not limited to glass manufacturer but were made various customers in numerous industries; float glass manufacturers could obtain soda ash from sources other than partner 2 on competitive pricing conditions---Merger was approved subject to the conditions that the undertakings would not impose any exclusive/restrictive conditions and/or enter into any agreements amongst each other and/or rival undertakings which might be anti-competitive in nature; that partner 1 would not impose any conditions on the joint venture company in relation to production, supply and/or distribution of their respective products; that the partners would not apply any dissimilar conditions, such as preferential treatment on the same type of transactions and that the partner 2 would not refuse to supply soda ash to rival undertakings of partner 1 and it would also not restrict partner 1 from acquiring soda ash from its rival undertakings. Head NotesCase Description Citation Name: 2023 CLD 64 COMPETITION COMMISSION OF PAKISTANBookmark this Case VS Preamble--- Scope--- Competition Commission of Pakistan is mandated under the Competition Act, 2010 read with Rules and Regulations framed thereunder to ensure free competition in all spheres of commercial and economic activity, to enhance economic efficiency, protect consumers and related market players from anti-competitive behaviour including abuse of dominance, deceptive marketing practices and mergers which may substantially lessen competition. Head NotesCase Description

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