PSMA, 55 Sugar mills fined Rs44bn for widespread manipulation

The Competition Commission of Pakistan (CCP) has imposed a fine of Rs44bn (around USD265m) on the Pakistan Sugar Mills Association (PSMA) and 55 sugar mills for widespread manipulation to control the production and supply of sugar. The CCP has held a total of 81 sugar mills responsible for cartelization.

The order issued by the chairman and three members says that sugar mills owners have manipulated the production, stock, export and local supply of sugar. They also influenced the bidding processes at the Utility Stores Corporation when it purchased sugar from mills.

The CCP initiated an enquiry in December 2019 after reports of cartelization had emerged. It had issued show-cause notices to 84 sugar mills affiliated with the PSMA, the order says.

At least four sugar mills are to pay Rs70 million each, while 22 mills would pay Rs50 million each. It adds up to Rs44bn.

The 26 mills were fined 10% of their turnover. The fine for other mills involved in manipulation would be announced later after determining their turnover, the order says.

It is estimated that the total fine will be as high as Rs60bn. This would be the heaviest fine imposed on any sector in Pakistan.

The CCP said that sugar mill owners in Sindh, Punjab, and KPK had formed cartels to jack up sugar prices. Their acts caused huge losses to not only the government but also consumers.

from News – SAMAA

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