ISLAMABAD: The Competition Appellate Tribunal has upheld the decision of the Competition Commission of Pakistan (CCP) against M/s Reliance Paints Pakistan for fixing the retail prices of its products in violation of Section 4 of the Competition Act, 2010.
The CCP initiated the investigation after receiving a formal complaint from Akzo Nobel Pakistan Ltd, which alleged that Reliance Paint fixed a minimum price for the resale of its products and also monitored and penalized dealers/distributors/retailers for not following its pricing guidelines, said a press release issued here on sunday.
The CCP inquiry report concluded that these practices restricted competition not only between dealers and retailers but also between Reliance and its competitors as the retail price became inflexible and dealers could not offer any discounts to consumers on Reliance products.
The Commission noted that the agreements/arrangements enforced by Reliance Paints restrict intra-brand competition between its dealers or distributors/retailers as the same impairs their ability to compete on price in the sale and distribution of Reliance Paint’s products. As a result, the CCP imposed a fine of PKR 5 million on Reliance Paints. Reliance Paints filed an appeal against the CCP order in the Competition Appellate Tribunal. The Tribunal upheld the Commission’s findings regarding the violation of Section 4 of the Act by Reliance Paint. However, it reduced the penalty to PKR 2.5 million.
