CCP Enforces Competition Law: 27 Million in Penalties Recovered

ISLAMABAD: The Competition Commission of Pakistan (CCP) has successfully retrieved PKR 27 million in fines from Reliance Paints and Pakistan Steel Mills (PSM) by utilizing its powers under Section 40(2)(a) of the Competition Act, 2010, through the seizure of their bank accounts.

These recoveries are part of the CCP’s broader initiative to enforce its role in maintaining fair competition across all industries, illustrating its dedication to addressing anti-competitive behavior.

In the past year, the CCP has recovered a total of PKR 69 million in fines, representing 25% of the total amount collected since the Commission’s inception in 2007. This notable achievement highlights the CCP’s continued vigilance and success in promoting fair competition and safeguarding consumer interests. To date, the CCP has recovered PKR 269 million in fines.

In the case of Reliance Paints, an investigation was launched following a formal complaint from Akzo Nobel Pakistan Ltd, which alleged that the company was setting minimum resale prices and penalizing dealers and retailers who did not adhere to its pricing instructions. The CCP’s investigation confirmed that Reliance Paints’ practices were inhibiting competition not only among its dealers but also between Reliance and its competitors, as fixed retail prices prevented consumer discounts. Consequently, the CCP imposed a fine of PKR 5 million, which was later reduced to PKR 2.5 million by the Competition Appellate Tribunal (CAT), although the Tribunal upheld the CCP’s conclusions.

In a separate case, the CCP has levied a fine of PKR 25 million on Pakistan Steel Mills (PSM) for exploiting its dominant position in the low-carbon steel market. The investigation carried out by the CCP from November 2008 to February 2009 revealed that PSM had engaged in anti-competitive conduct by unfairly limiting access to certain grades of steel billets, specifically SAE 1008 and SAE 1010. PSM was found to have denied supply to Frontier Foundry (FFPL) while favoring other buyers. This selective distribution distorted competition in the downstream market, where PSM has a monopoly.

These cases underscore the CCP’s proactive approach in protecting competitive practices and ensuring adherence to competition laws to promote a fair marketplace for everyone.