CCP Probes Poultry Firms Cartelization

Staff Report

ISLAMABAD: The Competition Commission of Pakistan (CCP) conducted a hearing in the poultry firms cartelization case, where the Pakistan Poultry Association (PPA) presented its defense against allegations of price fixing.

This hearing was scheduled following the issuance of show cause notices to the PPA and eight other entities for cartelization.

The CCP’s investigation revealed prima facie collusion and price fixing of day-old broiler chicks by a suspected cartel of eight hatcheries from 2019 to June 2021.

These entities 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 initiated after a surge in prices and complaints from broiler farmers through the Pakistan Citizens Portal, alleging cartelization in the sector.

Subsequently, searches and inspections were conducted at the premises of the PPA, and forensic analysis of the evidence uncovered that an official of one of the member firms played a central role in the cartel by coordinating mutually agreed prices of day-old broiler chicks.

These rates were communicated daily to other hatcheries and the PPA through SMS and WhatsApp, with pricing discussions also conducted through these mediums.

The inquiry also found the PPA in prima facie violation of Section 4 of the Act, as its official was involved in the pricing discussions and announcements. CCP issues Show Cause Notices to Fertilizer Firms

The general principle is that if price-sensitive information is being discussed, an undertaking or trade association must be seen to distance itself from collusive practices.

Most of the hatcheries involved in the suspected cartel are also vertically integrated and engaged in the entire poultry supply chain, from breeding to the production of broiler chickens, including poultry feed and egg production.

The next hearing is scheduled for May 21, 2024, where the remaining eight undertakings implicated in the case will present their stances.