Senate panel seeks to cut CCP down to size


Shahbaz Rana April 22, 2010

ISLAMABAD: The Senate Standing Committee on Finance and Revenue Thursday recommended reducing the Competition Commission of Pakistan to size by taking away important powers of imposing certain penalties and searching premises to get hold of documents. The National Assembly has already passed the bill and any new amendment in the CCP Bill 2009 by the Senate amounts to delaying the process of enactment of an anti-trust law.

The majority of the members of the committee proposed that the CCP should not have the authority to impose fines as high as 15 per cent of turnover of a company. They recommended that the maximum fine should be 25 per cent of the total profit for a specific year. Senator Haroon proposed that on continuous violation per day penalty should be reduced to Rs 100,000 from Rs one million. The majority of the members recommended that the CCP should not have unlimited powers to enter and search the premises.

Instead they proposed that the Commission should seek permission from an independent authority before searching a unit. Senator Haroon Akhtar who on Thursday turned out to be the most vocal member of the committee proposed clipping the CCP powers to enter a unit and make regulations. He also suggested taking away the powers of imposing fine equivalent to15 per cent of annual turnover of the company. Senator Safdar Abbasi proposed withdrawal of the powers of imposing penalties and changing the process of appointment of chairman and members of the commission.

“Senator Haroon and Senator Safdar’s recommendations will weaken the commission and dilute the process”, observed Senator Sugra Imam. The committee also invited the alleged violators of competition law to give recommendations to amend the proposed CCP Bill. The representatives of the sugar, cement and banking associations suggested limiting the commission’s powers of imposing fines and entering premises. The CCP has already either fined or investigating these associations. The recommendations of these associations and of Senator Safdar Abbasi, Senator Haroon Akhtar, Senator Islamuddin Sheikh and Senator Ilyas Bilour were the same.

“Without anti-trust law productivity is bound to suffer and so the consumers”, said Chairman CCP, Khalid Mirza. The committee also barred Khalid Mirza from issuing any statement to the media. Senator Ishaq Dar said fines imposed and collected by the CCP should straightway go to the treasury instead of resting with the watchdog. Special Secretary Finance, Asif Bajwa responded that the regulatory funds were aimed at giving financial autonomy to the regulators. Professor Khurshid recommended that the appellate bench should be completely independent.

The senators threatened the CCP chief that they would move a privilege motion against him, as he had given offensive statements. Khalid Mirza challenged the entire committee to prove that he had given these statements. Senator Haroon said that saying, “There are vested groups in and outside the parliament” was like accusing him. In a meeting where everyone except Senator Professor Khurshid of MMA and Senator Sugra Imam of PPP apparently wanted to dilute the bill no one raised its voice to protect consumers’ interest.

The committee did not invite consumers’ representatives in the meeting. The panel would again meet on May 5 and finalize its recommendation. After the 18th amendment, if the Senate decides to amend a Bill, which has already been approved by the NA, it would be sent back to the National Assembly for approval. Senator Ishaq Dar, former Finance Minister and a member of Constitutional Reforms Committee, said that if the NA did not approve the amended bill then constitutionally it would be tabled in a joint session of the Parliament. Earlier, a bill passed by the NA, but return with recommendations by the Senate used to go to mediation committee.

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COMMENTS (2)

Ali | 11 years ago | Reply Will the govt ever wake up. it was voted to power by people. however 2 years have passed still no good have come from them.The move to clip CCP wings is a strong indicator that the govt only things for itself and the businesses that support them no doubt cement,sugar and banks etc all are fleecing the consumers. They are parasites and need to be checked. God willing time will come when the govt will fall from its precarious perch.
Meekal Ahmed | 11 years ago | Reply Sugar, cement and banking sector? Check the data folks. These are amongst the most highly 'concentrated' sectors of the economy and weild unchecked monopoly pricing power. The banking sector is the most scandalous with 'spreads' of over 7.5% between what they pay the hapless depositor and what they charge to lend money even to their so-called 'prime' customers. In better run more competitive banking systems the spread is no more than 3%. We have taken millions of dollars from the World Bank and others for so-called 'Financial Sector Reforms'. Yet spreads remain the same and indeed have widened over the years.
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