ISLAMABAD - The anti-trust watchdog, the Competition Commission of Pakistan (CCP) is investigating price fixing of the freight charges at the Karachi Port and Port Qasim, the country’s two leading seaports, where it is suspected that these charges are being fixed collusively and truck owners are not allowed to independently charge companies for transporting their goods from the ports to city.
Sources told The Nation that during the initial fact finding and information gathering, the CCP observed that the freight lists containing freight rates from the ports to different locations in Karachi are circulated among the truck owners/drivers and they are under obligation to comply with the rates. No truck owner or drive is allowed to charge different freight rates to companies. Such a price fixing mechanism is a prima facie violation of the Competition Act, 2010.
Data available with the Commission also indicates that the “rate lists” are circulated among and revised because of increase/decrease in the prices of correlated economic variables. Such deliberations at the level of the undertakings appear to be prima facie contravention of Section 4 of the Act.
As part of the investigation into the prima facie violations of Section 4 of the Competition Act, 2010, the CCP also carried out search and inspection of the offices of two undertakings that are suspected of fixing and circulating freight charges among its members at the country’s two leading seaports.
The search and inspections were carried out under Section 34 of the Act during which the office bearers of the undertakings fully cooperated with the CCP’s search teams by handing over the documents and computer-stored information relating to the suspected role of the respective undertakings in alleged anti-competitive activities. Two different teams of authorized officers entered and searched the premises of the respective undertakings and seized pertinent information.
The information impounded during search inspections will be analysed by the CCP’s enquiry officers. Freight charges play an important role in the final price of the products that are imported via seaports. The CCP is mandated under the Act 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 fixation of prices of various goods and services.
Sources told The Nation that during the initial fact finding and information gathering, the CCP observed that the freight lists containing freight rates from the ports to different locations in Karachi are circulated among the truck owners/drivers and they are under obligation to comply with the rates. No truck owner or drive is allowed to charge different freight rates to companies. Such a price fixing mechanism is a prima facie violation of the Competition Act, 2010.
Data available with the Commission also indicates that the “rate lists” are circulated among and revised because of increase/decrease in the prices of correlated economic variables. Such deliberations at the level of the undertakings appear to be prima facie contravention of Section 4 of the Act.
As part of the investigation into the prima facie violations of Section 4 of the Competition Act, 2010, the CCP also carried out search and inspection of the offices of two undertakings that are suspected of fixing and circulating freight charges among its members at the country’s two leading seaports.
The search and inspections were carried out under Section 34 of the Act during which the office bearers of the undertakings fully cooperated with the CCP’s search teams by handing over the documents and computer-stored information relating to the suspected role of the respective undertakings in alleged anti-competitive activities. Two different teams of authorized officers entered and searched the premises of the respective undertakings and seized pertinent information.
The information impounded during search inspections will be analysed by the CCP’s enquiry officers. Freight charges play an important role in the final price of the products that are imported via seaports. The CCP is mandated under the Act 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 fixation of prices of various goods and services.
