Islamabad: The Competition Commission of Pakistan (CCP) has issued show-cause notices to two major transport associations for allegedly colluding to fix freight rates, an act that could have significant repercussions on national economic activity. The notices were sent to the Transporters of Goods Association (TGA) and the Local Goods Transport Association (LGTA) after an investigation revealed potential violations of competitive practices.

According to Competition Commission of Pakistan, the CCP initiated a suo motu inquiry following suspicions that TGA and LGTA were orchestrating freight rate increases from Port Qasim to various destinations across Pakistan. This investigation, prompted by circulars issued by the associations in 2018, 2021, and 2022, indicated that the associations might have enforced uniform freight charges among their members, penalizing those who failed to comply.

The inquiry has shown that such practices could disrupt the transportation sector, crucial for the distribution of essential goods including automotive parts, textiles, and construction materials, thereby impacting the broader economy. The alleged fixing of freight rates was found to not only affect trade within Karachi and its surrounding areas but also had potential economic implications across provincial borders.

The CCP’s actions, including searches and the seizure of documents, have provided substantial evidence pointing to a prima facie violation of the Competition Act of 2010. These findings underscore the necessity of maintaining competitive practices in essential services like transportation to prevent undue inflation of costs and ensure economic stability.