The Lahore High Court (LHC) has scheduled a hearing on April 15 for a petition filed by Honda Atlas Cars (Pakistan) Limited, which is contesting the jurisdiction of the Competition Commission of Pakistan (CCP) in an ongoing investigation into alleged anti-competitive practices in the automobile sector, The Express Tribune reported.
The CCP launched the inquiry in November 2018, after noting concerns about consumer exploitation, frequent price hikes, and unfair sales practices by leading players in the auto industry. Honda Atlas was included in the investigation, which focuses on potential violations of Sections 3 and 4 of the Competition Act 2010, addressing abuse of dominance and anti-competitive agreements.
Between 2018 and 2022, the commission issued multiple requests for information from Honda Atlas, covering areas such as car production, pricing policies, vehicle booking terms, imports, vendor arrangements, and localisation efforts.
However, the company sought extensions several times to meet these requests. Additionally, the CCP inquiry team visited Honda’s manufacturing facility in July 2019 and March 2021 to gather further data.
In October 2022, the commission issued a detailed request seeking information on investments made by Honda Japan and Honda Atlas, along with financial records, dealer circulars, and pricing structures.
According to the news report, Honda Atlas raised legal objections in December 2022, arguing that, following the 18th Amendment to the Constitution, trade and industry were now provincial matters, and thus, the federal regulator lacked authority over the issue.
The automaker filed multiple petitions, including a challenge to the CCP’s jurisdiction in the LHC in June 2023. The court granted an interim stay, halting the inquiry, and the matter has since been under review in over 15 hearings.
Legal precedents, such as the Supreme Court’s decision in the CCP vs Dalda Foods case, support the CCP’s authority to oversee market activities and conduct inquiries. That ruling emphasized the obligation of companies to comply with regulatory directives, indicating that judicial intervention should not be sought before a final decision is made.
At the time of the CCP inquiry’s initiation, only three auto manufacturers operated in the market, but the number has since increased to 13, highlighting the growing significance of fair competition in the sector.
The LHC’s ruling will clarify the extent of the CCP’s powers and may set an important precedent for future regulatory actions in high-stakes industries.
