PVMA’s appeal rejected: Rs 50 million fine for price -fixing upheld

ISLAMABAD: The Competition Appellate Tribunal has rejected the appeal of the Pakistan Vanaspati Manufacturers Association (PVMA), upholding the Competition Commission of Pakistan’s decision to impose a fine of 50 million rupees on the association for increasing cooking oil prices through collusion, engaging in anti-competitive practices, and using the association as a platform to fix prices.
In 2011, the Competition Commission had imposed a Rs 50 million fine on PVMA for violating the Competition Act by fixing the prices of ghee and cooking oil. The commission made this decision after conducting an inquiry and obtaining relevant evidence. According to investigations, ghee and cooking oil mills were using the association’s platform to set prices, and formal notifications were issued in this regard. The Vanaspati Association, comprising around 100 ghee and cooking oil mills, had continued to challenge the commission’s decision.
Additionally, the association had agreements with oil tanker associations and the National Logistics Cell (NLC) to fix transport rates, which hindered fair competition in the logistics sector and negatively impacted non-member entities. Furthermore, to address concerns of customs under-invoicing, the Vanaspati Association had been given the responsibility to verify receipts of imported edible oil. For this service, the association charged its members 4 rupees per metric ton and commercial importers 10 rupees per metric ton.
Defending itself before the Competition Appellate Tribunal, the association’s lawyer argued that prices were set via the association’s platform to stabilize the market in response to fluctuations in international palm oil prices.
After hearing arguments from both sides, the Competition Appellate Tribunal upheld the Competition Commission’s decision to fine the Vanaspati Manufacturers Association 50 million rupees, clarifying that no trade association is permitted to use its platform for price-fixing. Ends