CAT upholds Rs205 million CCP penalties, dismisses banks’ appeals in ESA cartel case

ISLAMABAD: The Competition Appellate Tribunal has dismissed long-pending appeals filed by several major banks and the Pakistan Banks Association, upholding the Competition Commission of Pakistan’s PKR 205 million penalties in the Enhanced Savings Account cartel case.

The Competition Appellate Tribunal (CAT) has rejected 10 appeals filed by multiple commercial banks and the Pakistan Banks Association (PBA), thereby affirming the Competition Commission of Pakistan’s (CCP) findings and penalties for cartel-like conduct in the introduction of the Enhanced Savings Account (ESA).

The appeals were filed against the CCP’s original order issued in April 2008 and the subsequent decision of the CCP’s Appellate Bench dated June 10, 2009. Both orders had held the PBA and seven major banks guilty of collusive practices that distorted competition in the banking sector and harmed small depositors.

According to the CCP’s findings, the coordinated introduction of the ESA product by the banks amounted to a concerted practice, creating unfair market conditions and violating Section 4 of the Competition Ordinance, 2007, which prohibits agreements that restrict or distort competition.

Under the original order, the CCP had imposed a penalty of PKR 30 million on the Pakistan Banks Association, while Habib Bank Limited, Allied Bank Limited, MCB Bank Limited, United Bank Limited, Saudi Pak Bank Limited, Atlas Bank Limited, and National Bank Limited were each fined PKR 25 million.

After hearing extensive arguments from all parties, the Tribunal dismissed all appeals through a short order, thereby upholding the penalties in full. The detailed judgment outlining the reasons for the decision is expected to be issued later.

The ESA case holds particular significance as it was the first major enforcement action initiated by the CCP following its establishment. The Tribunal’s decision marks a major milestone for the Commission and underscores the sustainability of its enforcement actions despite prolonged litigation.

The outcome also reflects the CCP’s strengthened litigation strategy and institutional reforms, under which the Commission has successfully resolved more than 70 percent of its long-pending court cases.

Commenting on the verdict, Dr Kabir Ahmed Sidhu stated that the decision reinforces the principle that justice may be delayed but cannot be denied, emphasizing that no entity can indefinitely evade accountability for anti-competitive conduct.