Islamabad: The Competition Commission of Pakistan (CCP) has issued show cause notices to GM Cables and Pipes (Pvt) Ltd. and Newage Cables (Pvt) Ltd., accusing them of engaging in resale price maintenance (RPM), a practice that may violate Section 4 of the Competition Act, 2010. This follows an inquiry that found both companies potentially restricted market competition through their pricing policies.
According to Competition Commission of Pakistan, the investigation into GM Cables and Newage Cables began after the CCP took suo motu action based on circulars from the companies that limited dealer discounts on credit and cash sales to set percentages. These circulars enforced a strict adherence to resale prices, threatening dealers with penalties such as fines and termination of dealership for non-compliance.
The inquiry revealed that both companies, which have a significant presence online and through a widespread dealer network, implemented policies that could prevent dealers from selling their products at lower prices. GM Cables’ “Notice for Rate Control” and Newage Cables’ “Retail Discount Policy” were specifically identified as tools used to maintain price controls across various regions, thus potentially stifling competition and affecting consumer choice across the national market.