CCP imposes over Rs 1.5 billion fines on steel giants for price fixation

ISLAMABAD, October 8: The Competition Commission of Pakistan (CCP) has imposed heavy financial penalties on Aisha Steel Mills Limited (ASML) and International Steels Limited (ISL) after finding both undertakings guilty of cartelization and price-fixing in violation of Section 4 of the Competition Act, 2010.
The CCP’s Bench, comprising Chairman Dr. Kabir Ahmed Sidhu and Member Ms. Bushra Naz, passed the final order, imposing a penalty of PKR 648,304,180/- (Rupees Six Hundred Forty-Eight Million Three Hundred Four Thousand One Hundred Eighty only) on Aisha Steel Mills Limited and PKR 914,236,980/- (Rupees Nine Hundred Fourteen Million Two Hundred Thirty-Six Thousand Nine Hundred Eighty only) on International Steels Limited.
The Bench determined that both undertakings had engaged in the most egregious form of cartelization, price fixing which is prohibited under Section 4(1) read with Section 4(2)(a) of the Competition Act. The Commission’s detailed order notes that ASML and ISL coordinated pricing strategies, fixed flat steel prices, and exchanged commercially sensitive information, thereby distorting competition and harming consumers. The CCP inquiry report suggested that the steel cartel increased prices by an average of 111%, with raw steel prices surging by Rs146,000 per tonne over three years.
In determining the quantum of penalty, the CCP Bench applied its Guidelines on Imposition of Financial Penalties, which emphasize two key objectives: deterring undertakings from engaging in anti-competitive conduct and reflecting the seriousness of the infringement. The Bench evaluated the seriousness, duration, and aggravating factors of the violation before determining the penalty amount.
The order highlights that flat steel is a critical commodity in Pakistan’s economy, used in multiple sectors including construction, automotive, appliances, and agriculture. Any manipulation of prices in this essential market has a direct impact on consumers, businesses, and the overall economy. The Chairman CCP observed that the steel sector in Pakistan remains largely unregulated compared to other jurisdictions such as the China, India United States, the European Union, and the United Kingdom, where regulatory oversight ensures transparency and accountability. The Commission, therefore, underscored its responsibility to protect competition and consumers in such a vital sector.
The order further found that the cartel remained operational for more than three years—from July 2020 to December 2023. Evidence presented in the inquiry and subsequent proceedings confirmed that senior management, including chief executive officers of both companies, were directly involved in the collusive conduct. No mitigating factors were identified that could reduce the culpability of either undertaking.
Consequently, the CCP Bench held that both undertakings had committed deliberate and prolonged violations of the Competition Act and were not entitled to any leniency. The penalties represent 1% of the annual turnover of each undertaking for the financial year 2021–2022. Both companies have been directed to deposit the penalty amount within 60 days from the date of the order. Failure to comply will result in an additional penalty of PKR 100,000 per day and may lead to the initiation of criminal proceedings under Section 38 of the Act.
Background of the Case
The CCP initiated an inquiry into the flat steel sector in May 2021 after receiving complaints regarding parallel pricing patterns among leading producers. The inquiry found prima facie evidence of cartel-like behavior involving Aisha Steel Mills Limited and International Steels Limited.
On June 12, 2024, the Commission conducted search and inspection operations at the premises of both undertakings, uncovering crucial evidence of coordinated conduct, including identical price revisions and information exchange. The CCP’s price analysis confirmed that both companies maintained identical and simultaneous price changes between July 2020 and December 2023, indicating collusion rather than independent pricing behavior.
Following the investigation, Show Cause Notices were issued to both undertakings in March 2025, outlining violations of Section 4 of the Competition Act, 2010, which prohibits agreements and decisions between competitors that restrict, prevent, or reduce competition in the market.
The order passed by the CCP Bench concludes this long-standing case, affirming the Commission’s resolve to curb cartelization and protect consumers from anti-competitive practices in key sectors of Pakistan’s economy.