CCP Recovers Penalty Over Anti Competitive Agreement

The Competition Commission of Pakistan has successfully recovered a cumulative penalty of Rs40 million from United Distributors Pakistan Limited and International Brands (Private) Limited in relation to an anti-competitive arrangement.

This recovery follows the decision of the Competition Appellate Tribunal, which upheld the findings of the regulator, confirming that the agreement constituted a prohibited market-sharing practice in violation of competition laws.

The matter originated from a disclosure made by United Distributors Pakistan Limited to the Pakistan Stock Exchange, indicating the execution of a non-compete agreement with International Brands (Private) Limited.

Under the terms of the arrangement, UDPL agreed to abstain from the distribution of human pharmaceutical products within Pakistan for a period of three years. In consideration, UDPL received a payment of Rs1.131 billion from IBL, a transaction subsequently scrutinised by the competition regulator for its implications on market competition.

Upon detailed examination, the Competition Commission of Pakistan concluded that the agreement resulted in a restriction of competition within the relevant market and imposed financial penalties on both entities, which have now been enforced following the tribunal’s affirmation of the order.