2025 CLD 355 COMPETITION COMMISSION OF PAKISTAN

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VS Ss. 4(1) & 4(2)(a)---Sindh Essential Commodities Price Control and Prevention of Profiteering and Hoarding Act, 2005 (IX of 2006), Preamble---Price of fresh milk (in Karachi), fixing of---Dairy and Cattle Farmers Associations as Association of 'undertakings', role of---Anti-Competitive Practices---Failure of the Commissioner Karachi regarding setting prices in dairy market---Argument of the Dairy and Cattle Farmers Associations (Respondents/Associations) was that their input costs increased significantly during the relevant period but the Commissioner Karachi failed to adjust inflationary pressures despite multiple appeals; consequently, they had no other option available but to raise prices---Validity---Despite failure of Commissioner Karachi to fix the prices in alignment with inflationary pressures under the Sindh Essential Commodities Price Control and Prevention of Profiteering and Hoarding Act, 2005, in normal market settings, each dairy farmer would have fixed its own prices taking into account demand and supply, costs incurred and economies of scale in case of bigger dairy farmers---Contrary to this the evidence /record, especially the video graphic evidence, indicates that Respondents/Associations colluded, coordinated, congregated a crowd of farmers before manipulating the milk price and key representatives of Associations announced prices of fresh milk which highlight their direct involvement in price setting mechanism, indicating manipulation of market dynamics to profit and to exploit consumers---No legal or regulatory framework should be manipulated to hinder competition or harm consumers---Any attempt to misuse regulations to conceal anti-competitive behavior to undermine market mechanism may constitute violation of the Competition Act, 2010---Representatives of the Respondents / Associations are engaged in anti-competitive activities by making decisions that set the prices of fresh milk in Karachi in violation of Ss. 4(1) & 4(2)(a) of the Competition Act, 2010---Competition Commission of Pakistan, however, in levying penalties, took a lenient view on account of failure of administrative role by the Commissioner Karachi as envisaged under the Sindh Essential Commodities Price Control and Prevention of Profiteering and Hoarding Act, 2005, and imposed a financial penalty on Respondents /Associations while directing them to submit a written commitment to the Commission that they will refrain from engaging in any form of market abuse, manipulation or any other anti-competitive practices prohibited under the Competition Act, 2010---Show Cause Notice against the Dairy and Cattle Farmers Associations succeeded accordingly.

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