The Competition Commission of Pakistan (CCP) has imposed a total penalty of PKR 60 million on the All Pakistan Edible Oil Tanker Owners Association (APEOTOA) for fixing transportation charges and allocating business among tanker owners through a restrictive queue system.
The Commission found the practices in violation of Section 4 of the Competition Act, 2010. It imposed PKR 30 million each for price fixing and market allocation.
CCP Finds Evidence Of Transportation Rate Fixing
The case began after CCP market surveillance detected circulars fixing transportation charges for edible oil, ghee and fats transported from Karachi ports to destinations across Pakistan.
The Commission initiated a suo motu enquiry in August 2024 and conducted a search and inspection in February 2025.
According to the enquiry findings, material obtained during the search showed that APEOTOA revised transportation rates 89 times between 2019 and 2025. These revisions included 52 increases and 37 decreases.
The corresponding circulars issued by the Pakistan Vanaspati Manufacturers Association (PVMA) communicated matching changes in transportation rates. APEOTOA representatives also acknowledged that transport rates were determined through an agreement between the two associations.
Commission Rejects ‘Advisory’ Circular Defence
APEOTOA argued that its rate circulars were merely advisory and did not legally bind tanker owners.
The CCP rejected this position, holding that even non-binding recommendations issued by a trade association can restrict competition if they influence members’ independent commercial decisions.
The Commission also relied on the Supreme Court’s judgment in the PVMA case, which affirmed that competing businesses must remain free to determine their prices independently.
Queue System Found To Allocate Tanker Business
The CCP separately found that APEOTOA operated a queue system that allocated consignments among tanker owners instead of allowing them to compete independently for business.
The Association issued parchis for lifting consignments and enforced compliance with the allocation system.
A September 2023 circular imposed a PKR 500,000 fine each on a tanker and its owner for violating specified allocation conditions.
The Commission determined that the relevant market was road transportation services for edible oil, ghee and fats across Pakistan.
Penalty Reflects Duration And Market Position
In determining the penalty, the Commission considered several factors, including APEOTOA’s substantial market position and the nearly six-year duration of the pricing conduct.
The CCP also considered the involvement of senior management and the continuation of rate revisions even after enforcement proceedings had commenced.
Based on these factors, the Commission imposed PKR 30 million for price fixing and another PKR 30 million for market allocation, bringing the total penalty to PKR 60 million.
APEOTOA Ordered To End Anti-Competitive Practices
Alongside the financial penalty, the CCP directed APEOTOA to immediately cease the anti-competitive practices identified in the proceedings.
The Association has also been ordered to recall existing price circulars and discontinue the queue system that had the effect of dividing the market.
APEOTOA must publish notices in two Urdu and two English national newspapers clarifying that tanker owners are free to independently determine transportation rates and lift consignments regardless of whether they are members of the Association.
60-Day Compliance Deadline
The penalty must be deposited and compliance reported to the Commission within 60 days.
Failure to comply may result in an additional penalty of PKR 50,000 per day, along with possible criminal proceedings under Section 38 of the Competition Act, 2010.