The Competition Commission of Pakistan (CCP) has fined two companies for making an illegal deal worth Rs1.13 billion. United Distributors Pakistan Limited (UDPL) and International Brands Limited (IBL) were found guilty of signing a non-compete agreement. The CCP said this deal was against Section 4 of the Competition Act, 2010.
The deal stopped UDPL from entering the human pharmaceutical distribution market for three years. In return, IBL paid them Rs1.131 billion. This payment was shared with the Pakistan Stock Exchange (PSX), but no approval was taken from CCP in advance.
The CCP called the agreement a clear case of market-sharing. It said the deal harmed healthy competition and created unfair advantages for IBL. It also blocked new options for consumers and hurt the market’s growth.
Both companies were fined Rs20 million each for this violation. An extra Rs1 million was imposed on UDPL for not getting regulatory clearance before announcing the deal on PSX. CCP also warned of more daily fines if they failed to follow orders.
The companies must now submit a compliance report within 30 days. The CCP has also referred the case to the Securities and Exchange Commission of Pakistan (SECP) and PSX for further possible action.