Court Declines Stay Order on CCP’s Massive Fine on Poultry Firms

The Lahore High Court has refused to halt proceedings of the Competition Appellate Tribunal in a fresh poultry cartel case involving penalties of Rs. 155 million imposed on major poultry companies and the poultry association. The case relates to alleged price fixing of day-old broiler chicks. The Competition Appellate Tribunal is currently hearing appeals filed by poultry hatcheries and the poultry association against an order of the Competition Commission of Pakistan. Petitions seeking a stay on the tribunal proceedings were filed by Supreme Farms Private Limited and Sabir Poultry. The petitioners asked the court to restrain the tribunal from deciding the appeals until their constitutional challenges were resolved. Supreme Farms challenged the legality of certain provisions of the Competition Act, 2010. These included Section 34, which allows the Competition Commission to enter and search premises, and Section 53, which permits the commission to seek assistance from other government agencies for evidence collection. The company also objected to the tribunal relying on forensic reports prepared by the Federal Investigation Agency and data obtained from the Pakistan Telecommunication Authority. These materials had been used by the Competition Commission in passing its order. During earlier search and inspection operations, the Competition Commission recovered electronic evidence from the offices of the poultry association and several hatcheries. The material was later forensically analysed and formed part of the evidence in the case. Sabir Poultry filed a separate petition on similar grounds, asking the court to stop the tribunal from issuing a decision based on mobile phone data and information obtained from the telecom regulator. The Lahore High Court declined to grant any stay or suspension of the tribunal proceedings. However, it allowed the petitions to remain pending and said the constitutional issues raised would be examined on merit. Earlier in April, the Competition Commission imposed a cumulative penalty of Rs. 155 million on eight poultry hatcheries and the poultry association after a suo motu inquiry into the day-old broiler chick market. The inquiry found that several major hatcheries were involved in coordinated price fixing, in violation of Section 4 of the Competition Act, 2010. The companies named in the order included Sadiq Poultry, Hi Tech Group, Islamabad Group, Olympia Group, Jadeed Group, Supreme Farms, Big Bird Group and Sabir’s Group.