For their suspected involvement in the cartelization and anti-competitive activities in the poultry sector, the Pakistan Poultry Association (PPA) has been raided by the Competition Commission of Pakistan (CCP) in Lahore.
Pakistan Poultry Association Raided: The CCP carried out a search and inspection raid of the Pakistan Poultry Association for their suspected involvement in the cartelization and anti-competitive activities in the poultry sector. The raid is part of an investigation into the alleged violation of Section 4 of the Competition Act, 2010, and the CCP has exercised its power under Section 24 of the Act.
According to the undertaking, the occupiers of the premises of PPA extended full cooperation and gave access to the print and electronic record as two different teams of CCP entered and searched the premises. Several pieces of information have been impounded which may provide evidence about the price-fixing of day-old chick, broiler, and eggs. The information includes the minutes of the meetings of PPA and computer-stored information of the representatives of PPA.
The inquiry was started by CCP as it took notice of the drastic increase in prices of various poultry products, including broiler chicken, table eggs, and day-old broiler chicks. Chicken prices reached Rs. 325 per kg (live chicken rate), rising 110 per cent from March 2020 to March 2021 as noticed by the CCP. Egg prices also touched a peak of Rs. 197.76 per dozen in December 2020 rising by 42 per cent from March 2020 to March 2021.
The CCP came to know that PPA has been involved in the communication of egg prices. Furthermore, posts regarding the collective rates of eggs and “mutahidda” plan of action with strict adherence on different social media platforms indicated that PPA’s platform is being used for price-fixing which is a prima facie contravention of section 4 of the Act.
On the other hand, the day-old broiler chicks also experienced a rise of 386 per cent between March 2020 and May 2021 which is also being probed by CCP for possible collusion in the determination of prices. In May 2021, a chick was being sold for Rs. 90 while the same chicks were priced at Rs. 18.5 in March 2020.
The CCP teams have collected record and material which may provide proof of anti-competitive practices, including price-fixing of the day-old chicks, broiler chicken, and eggs. The same material can also give evidence of the possible role of the association and other undertakings in the recent hike in the prices of poultry products.
The CCP has also issued show-cause notices to 19 feed companies for cartelization and a collective increase in feed prices, which has increased the prices of chicken and eggs. The findings of the CCP’s inquiry report on feed mills cartelization has helped bring chicken broiler prices from Rs. 325 to Rs. 233 per kg over the past two weeks. Other reasons for the stringent actions are the focus of National Price Monitoring Committee (NPMC) meetings on essential commodity prices held under the chairmanship of the Federal Finance Minister and stringent notice taken by the provincial government including Khyber Pakhtunkhwa and Punjab.
The mandate of the CCP under the Act is 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.