ISLAMABAD: The Competition Commission of Pakistan (CCP) has issued Show Cause Notices to International Steel Limited (ISL) and Aisha Steel Mills Limited (ASML) for alleged cartelization in the flat steel market. An inquiry by the CCP found prima facie evidence suggesting that the two leading producers engaged in price-fixing, coordinated price changes, and exchanged commercially sensitive information—violating Section 4 of the Competition Act, 2010.
As per details the CCP launched its inquiry in May 2021 after receiving informal complaints about possible cartelization among local flat steel manufacturers. Complaints indicated that flat steel product prices were moving in parallel, with allegations of an artificial shortage in the market.
Price analysis revealed a pattern of price parallelism among major players, with simultaneous and identical price changes. Between July 2020 and December 2023, the price of cold-rolled coil (CRC) increased by Rs. 146,000 per metric ton for ISL and Rs. 145,900 per metric ton for ASML, reflecting an average increase of 111 percent.
To further investigate these allegations, the CCP conducted a search and inspection at ISL and ASML’s premises on June 12, 2024. The impounded evidence suggests that both companies allegedly coordinated before implementing price changes and discounts. According to the inquiry report, ISL and ASML also exchanged commercially sensitive information on raw material purchase prices, enabling them to align final product pricing.
Flat steel products, including Cold Rolled Coil (CRC) and Galvanized Coil (GC), are essential for industries such as electronics, automotive, agriculture, and manufacturing. Anti-competitive behavior in this sector can have significant implications, driving up industrial costs and consumer prices. However, the CCP’s investigation found no evidence of collusion by the smaller competitor, Hadeed Pakistan Limited (HPL).
Based on these findings, the CCP has issued Show Cause Notices to ISL and ASML. The Commission will issue a final ruling after reviewing the written and oral arguments presented by the parties.
