Sindh High Court issues second stay order, restricting CCP to proceed against Cement Manufacturers

December 24, 2020 (MLN): The Competition Commission of Pakistan (CCP) has been restricted to proceed against the Cement Manufacturers, as the Sindh High Court has issued a second stay order to Cement Manufacturers in case of alleged cartelization.

 It is the second stay order granted by the Sindh High Court as in the first stay order, the honorable court restrained the CCP from proceeding against those cement manufacturers falling into the jurisdiction of the Southern region, The News reported on Thursday.

For the unversed, the Competition Commission of Pakistan (CCP) had found firm evidence of cartelization in the cement manufacturing sector and had proven the involvement of All Pakistan Cement Manufacturers Association (APCMA) in anti-competitive activities on December 15, 2020.

The findings of the inquiry launched by the CCP this year in May revealed that the cement manufacturers in Northern region earned an unjustified additional Rs40 billion profits by establishing cartels.

CCP had started an inquiry against the cement manufacturers on the basis of various media reports published between April and May 2020 regarding an increase in the price of cement, particularly the 50kg per bag, by Cement manufacturers.

According to CCP, prices were increased at a time when the cost of production had gone down significantly, and the manufacturers also did not pass on the impact of 25% reduction in federal excise duty to consumers.

Once the inquiry report was made public, a cement company in Lahore approached the Sindh High Court again and obtained another stay order despite the fact that neither the cause of action (the inspections) arose in Sindh nor the defendant (CCP) has any office in Sindh. As a result, CCP is constrained from issuing show cause notices and passing the final order in the matter, The News quoted.

It was the second time that the CCP has detained a cartel in the cement sector. It was also the second cartel that the CCP exposed after recently revealing market malpractices in the sugar sector by the industry tycoons.

Copyright Mettis Link News