Islamabad: The Competition Commission of Pakistan (CCP) has issued directives against the use of the term ‘Big Four’ in commercial agreements concerning the appointment of firms for assurance or financial services. This decision emerged from the CCP’s review of applications from MNT Halan Pak B.V. and Advans S.A. SICAR, which both sought exemptions for certain restrictive clauses in their contracts that referenced the ‘Big Four.’ The CCP’s stance aims to prevent restrictions that could potentially hinder fair competition within the financial and assurance service sectors.

According to Competition Commission of Pakistan, the term ‘Big Four’ traditionally refers to the top global firms providing services in assurance, consulting, financial advisory, risk management, and tax consultation. Both MNT Halan Pak B.V. and Advans S.A. SICAR incorporated this term in their agreements while applying for exemptions to certain restrictive clauses in dealings with third parties. The CCP has clarified that specifying or limiting the selection of firms to the ‘Big Four’ in contracts is not permissible under the Competition Law. It emphasized that such practices could impair open and fair competition in the relevant market.

Additionally, the CCP highlighted that there are multiple firms capable of providing these services, as evidenced by lists maintained by various authoritative bodies in Pakistan. The Institute of Chartered Accountants of Pakistan (ICAP) lists 130 CA firms with satisfactory Quality Control Review ratings. The State Bank of Pakistan (SBP) includes 46 auditors in its panel under the Banking Companies Ordinance, 1962, categorized into three groups. The Securities and Exchange Commission of Pakistan (SECP) also maintains an approved list of auditors for insurance and takaful entities audits. None of these listings suggest a preference for the ‘Big Four,’ indicating a broader acceptance of qualified firms.

The CCP’s decision underlines its commitment to upholding the principles of the Competition Act, 2010, which advocates for open and fair competition. By directing that the selection process for financial or assurance services should not be confined to the ‘Big Four,’ the CCP aims to ensure a level playing field and foster a competitive environment that benefits a wider spectrum of firms within Pakistan.