CCP Visits Pakistan Flour Mills Association After Imposing Rs. 75 Million Penalty

The Competition Commission of Pakistan (CCP) carried out a search and inspection of Pakistan Flour Mills Association’s (PFMA) premises in Lahore and confiscated important documents from PFMA premises.

Reports said that the PM took a hard stance against CCP, blaming it for the wheat flour crisis.

The CCP, in its recent order dated 13 December 2019, had imposed a penalty of Rs. 75 million on PFMA for taking decisions with respect to fixing the price and the production quantity of wheat by its member mills.

The CCP had issued directions to PFMA that, discussions, deliberations, and decisions regarding current and future pricing, production and marketing are anticompetitive and should be avoided at all costs by the associations. Despite the foregoing directions, based on the information received by CCP, PFMA and its members prima facie are involved in prohibited conduct under the Competition Act.

Through its various enforcement orders, CCP had issued guidelines with reference to the conduct/role of associations in any sector. The association may engage in activities that increase awareness of standards and technologies and may also make an effort to develop consensus amongst its members regarding public policies.

However, the association should not, at any cost, indulge in any activity which may violate the Act. The rule of thumb is that the association is not allowed to discuss, deliberate or share sensitive commercial information that may allow its Members, who are competitors to co-ordinate business policy.

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