CCP Slaps Rs. 265 Million Fine on Two Local Cable Companies for Price-Fixing

The Competition Commission of Pakistan (CCP) has imposed a combined penalty of Rs. 265 million on two local cable firms for engaging in Resale Price Maintenance (RPM), a violation of Section 4 of the Competition Act, 2010.

Newage Cables (Pvt.) Ltd. was fined Rs. 75 million, while GM Cables & Pipes (Pvt.) Ltd. received a Rs. 190.22 million penalty.

The sanctions follow a CCP enquiry triggered by documentary evidence, including policy circulars instructing dealers not to offer discounts beyond prescribed limits.

The circulars also threatened punitive measures, including termination of dealership agreements, for non-compliance.

The Commission’s enquiry under Section 37(1) confirmed that both companies had imposed minimum resale price restrictions on their dealers. Newage’s policies prohibited dealers from selling below set discount levels, and GM Cables enforced similar controls through rate notices and communications.

Based on the enquiry committee’s recommendations, show cause notices were issued. After hearings and detailed evidence analysis, CCP concluded that both firms had engaged in RPM practices “by object,” effectively restricting intra-brand price competition and reducing consumer choice.

The Commission noted that the anti-competitive practices were formalized via circulars and enforced through coercion, including threats of dealer suspension or termination. While Newage demonstrated cooperation during the proceedings, GM Cables continued to infringe on conduct and challenged documented evidence.

Consequently, CCP imposed a Rs. 75 million fine on Newage Cables and a 5 percent annual turnover penalty on GM Cables, totaling Rs. 190.22 million. Both companies must pay the fines within 60 days, or face an additional Rs. 500,000 per day until compliance.

Furthermore, the Commission directed the firms to immediately cease imposing minimum resale price restrictions, withdraw all related instructions to dealers, and submit compliance reports within the prescribed timelines. Newage must also remove discount cap provisions from its dealership agreements.

The order shows CCP’s firm stance on promoting fair competition and safeguarding consumers against anti-competitive practices.