Islamabad, Pakistan: The Competition Commission of Pakistan (CCP) has conducted a significant hearing in the ongoing poultry cartelisation case, with the Pakistan Poultry Association (PPA) presenting its defence against allegations of price fixing.
This hearing followed the issuance of show-cause notices to the PPA and eight other entities, accusing them of cartelisation activities.
The CCP’s investigation uncovered prima facie evidence of collusion and price fixing of day-old broiler chicks by a suspected cartel comprising eight hatcheries, spanning from 2019 to June 2021. The entities involved include Hitech Group, Islamabad Group of Companies, Olympia Group, Jadeed Group, Supreme Farms (Season’s Foods), Big Bird Group, and Sabirs’ Group.
The inquiry was prompted by a notable surge in prices and complaints lodged by broiler farmers via the Pakistan Citizens Portal, alleging cartelisation within the sector. Subsequent search and inspection operations at the premises of the PPA revealed that an official from one of the member firms played a central role in coordinating the mutually agreed prices of day-old broiler chicks. This coordination was facilitated through daily communications sent via SMS and WhatsApp to other hatcheries and the PPA, with pricing discussions also conducted through these platforms.
The CCP’s inquiry found the PPA in prima facie violation of Section 4 of the Competition Act, as an official was actively involved in the pricing discussions and announcements. The general principle under competition law dictates that if price-sensitive information is being discussed, a trade association must distance itself from any collusive practices.
Most of the hatcheries implicated in the suspected cartel are vertically integrated, participating in the entire poultry supply chain, from breeding to the production of broiler chicken, including poultry feed and eggs production.
The next hearing is scheduled for May 21, 2024, where the remaining eight undertakings implicated in the case will present their stances.
