CCP to issue show cause notice to APCMA today

CCP to issue show cause notice to APCMA today
Published: 27 October 2008

The Competition Commission of Pakistan (CCP) has decided to issue show cause notice to the All Pakistan Cement Manufacturers Association (APCMA), Lahore on Monday against the Cartelisation of the cement manufacturers, allegedly involved in price hike of cement.

Sources told Business Recorder on Sunday that the CCP has completed investigation against the cement manufacturers on the basis of evidence available during inspection of the APCMA headquarters at Lahore. The inquiry has been completed and subsequently show cause notices would be issued to all the cement manufacturers.

Sources said that the CCP would also issue show cause notice to the chartered accountant firm engaged by the APCMA to maintain data of the cement manufacturers. The CCP has found that the firm has assisted the cement manufacturers in Cartelisation. The firm was hired to monitor production, clearances and other matters of the cement units, which supported Cartelisation. The CCP has enough evidence to prove Cartelisation against the cement manufacturers and necessary proceedings would be initiated under the provisions of Competition Ordinance 2007.

Despite immense political pressure, the CCP has decided not to withdraw inquiry against the cement manufacturers. There is enormous pressure from government departments and politicians to end the inquiry against the cement cartel. However, the CCP would complete the inquiry as per provisions of the Competition Ordinance 2007.

"There is always pressure on regulators from government departments as well as the industry. In the current political environment, legal action against the cement manufactures is an uphill task for the CCP", sources said. Sources said that the CCP is legally empowered to impose penalty up to 15 per cent of the turnover or maximum penalty of Rs 50 million on each company involved in Cartelisation. In US and European countries, the penalty for committing a crime of Cartelisation is substantially more as compared to Pakistan. For example, US commission can hand down 12 years of imprisonment to a person involved in Cartelisation.