The Competition Commission of Pakistan (CCP) has imposed a combined penalty of Rs 265 million on two cable manufacturers for restricting how their dealers set prices, in a move aimed at protecting fair competition and consumer choice.
In a detailed order, the Commission fined Newage Cables (Pvt.) Ltd. Rs75 million and GM Cables & Pipes (Pvt.) Ltd. Rs 190.22 million for enforcing minimum resale prices, a practice that prevents dealers from offering competitive discounts.
The case emerged after the CCP received evidence, including official circulars issued by the companies, which showed that dealers were not allowed to sell below fixed discount limits. In some cases, dealers risked losing their contracts if they failed to follow these instructions.
Following an initial review, the Commission launched a formal enquiry under the Competition Act, 2010. The investigation found that both companies had introduced policies that effectively controlled retail pricing through their dealer networks. These measures, the CCP concluded, limited price competition within the same brand also known as intra-brand competition.
According to the findings, Newage Cables had built these restrictions into its dealership agreements, while GM Cables issued rate control notices to enforce similar conditions. The Commission noted that such practices reduce flexibility in the market and ultimately harm consumers by keeping prices artificially high.
Both companies were issued show-cause notices and given an opportunity to respond. After reviewing the evidence and hearing both sides, the CCP ruled that the actions amounted to a clear violation of Section 4 of the law, which prohibits agreements that distort competition.
The order also highlighted a difference in conduct during the proceedings. Newage Cables was described as cooperative, while GM Cables was found to have continued its practices even after the enquiry had begun and challenged the evidence presented.
As part of the ruling, both firms have been directed to immediately stop enforcing minimum resale prices, withdraw all related instructions, and allow dealers to independently determine prices. They must also submit compliance reports within the given timeframe. In addition, Newage has been told to remove discount restrictions from its agreements.
If the penalties are not paid within 60 days, both companies could face an additional fine of Rs500,000 per day until they comply.
