Competition Commission of Pakistan (CCP) on Monday issued a policy note to the federal government, all provincial governments, and the administration of the Islamabad Capital Territory (ICT), recommending that the present practice of price determination of fresh milk be reformed to address competition concerns. The policy note recommends that any members of associations, associations themselves or any stakeholders from the marketplace must not be invited to and must not participate in any formal or informal meeting in which the price of fresh milk is decided. It further recommends that the price of fresh milk must be based on careful and independent analysis undertaken by respective government officers working as the members of the price review committee. By engaging in negotiations with milk sellers associations and milk retailers association, the government itself becomes a party to a prohibited practice. Also, such agreements under the auspices of the government promote practices that are a violation of the Competition Act, 2010. Therefore, CCP believes that the government at any level must not provide any patronage to anticompetitive practices that may encourage collusive behaviour. CCP took cognizance of various news items reporting that the local authorities set the price of fresh milk after consulting dairy farmers’ associations. It gathered relevant information, and found that the officers involved in the price control work, survey markets to ascertain milk prices. Afterwards, negotiations between members of the price control committee, the government’s price control staff and the respective stakeholders including associations take place and a price is agreed upon.
