ISLAMABAD: The Competition Appellate Tribunal (CAT) has reserved judgment in a long-running case involving the Institute of Chartered Accountants of Pakistan (ICAP), which is contesting a penalty imposed by the Competition Commission of Pakistan (CCP) for allegedly fixing minimum audit fees.
The dispute originates from 2008, when the CCP took suo moto notice of ICAP’s issuance of a revised Accounting Technical Release 14 (ATR-14). Approved by ICAP’s Council in July 2008, the revised ATR set minimum hourly charge-out rates and minimum audit fees for public sector audits. The CCP viewed this as a violation of Section 4(1) of the Competition Ordinance, 2007, which prohibits agreements that limit or control prices, deeming them anti-competitive.
Declaring ATR-14 null and void, the CCP had directed ICAP to retract the policy from its Members’ Handbook, issue a public withdrawal notice, and pay a Rs1 million fine.
ICAP challenged the ruling before CAT, maintaining that it acts as a statutory regulator under the Chartered Accountants Ordinance, 1961, and has legal authority to establish minimum fees to ensure audit quality, especially in government-sector engagements. Representing the institute, senior advocate Dr. Farrukh Nasim argued that such guidance ensures fair compensation for professional services and discourages undercutting that could compromise standards.
In response, CCP’s counsel insisted that regulatory status does not grant ICAP the right to coordinate prices in a competitive market. The Commission characterized the ATR-14 guidance as collusive pricing—contrary to global competition norms and Pakistan’s competition law.
The tribunal’s forthcoming ruling is expected to set a precedent regarding the balance between professional self-regulation and competition law compliance, particularly in sectors where regulators also function as industry bodies.
