The officials of the Competition Commission of Pakistan (CCP), exercising its power under Section 34 of the Act, carried out a search and inspection on Tuesday of the Pakistan Poultry Association (PPA) and an undertaking in the poultry business in Lahore.
The inspection is part of an investigation into the alleged violation of Section 4 of the Competition Act, 2010 in the poultry sector and the PPA’s suspected involvement in cartelisation and anti-competitive activities in the poultry sector.
Two teams of CCP entered and searched the PPA premises. The PPA representatives cooperated and gave access to their record and information like minutes of PPA meetings and information stored on computers.
The records of PPA and the said undertaking have been impounded to be examined thoroughly to seek evidence about price-fixing of day-old chicks, broilers, and eggs.
The CCP took notice of a drastic increase in the prices of various poultry products, including broiler chicken, table eggs, and day-old broiler chicks and started an enquiry.
The CCP noted that from March, 2020 to May, 2021, chicken prices experienced a rise of 110 per cent, reaching Rs325 per kg (live chicken rate). Similarly, egg prices too saw a rising trend from March, 2020 to May, 2021, rising by 42 per cent, touching a peak of Rs197.76 per dozen in December, 2020.
It came to the CCP’s knowledge that PPA has been involved in the communication of egg prices. Furthermore, the appearance of different posts on social media platforms regarding the collective rates of eggs and ‘mutahidda’ plan of action with strict adherence indicates that the PPA platform is being used for price-fixing, which is a prima facie contravention of section 4 of the act.
The CCP is also probing possible collusion in the determination of prices of day-old broiler chicks, which experienced a rise of 386 per cent between March, 2020 and May, 2021. In March, 2020, a chick was priced at Rs18.5, and in May 2021, the same chicks were being sold for Rs90 each.
It is pertinent to mention that in another recent inquiry in the poultry sector, the CCP has issued show-cause notices to 19 feed companies for cartelisation and a collective increase in feed prices, which resulted in an increase in the prices of chicken and eggs.
The focus of the National Price Monitoring Committee (NPMC) meetings on essential commodity prices held under the chairmanship of the federal finance minister, and notice taken by Punjab and Khyber Pakhtunkhwa provincial governments after the findings of the CCP enquiry report has helped bring broiler prices from Rs325 per kg to Rs233 per kg over the past two weeks.
The CCP is mandated to ensure free competition in all spheres of commercial and economic activity, to enhance economic efficiency and to protect consumers from anti-competitive practices, including deceptive marketing practices.
Published in The Express Tribune, June 2nd, 2021.