ISLAMABAD – The Competition Commission of Pakistan (CCP) has imposed heavy financial penalties on Aisha Steel Mills Limited (ASML) and International Steels Limited (ISL) after finding both undertakings guilty of cartelization and price-fixing.
The CCP’s bench, comprising Chairman Dr Kabir Ahmed Sidhu and Member Ms Bushra Naz, passed the final order, imposing a penalty of PKR 648,304,180 on Aisha Steel Mills Limited and PKR 914,236,980 on International Steels Limited.
The bench determined that both undertakings had engaged in cartelization and price fixing, which is prohibited under the Competition Act. The Commission’s detailed order notes that ASML and ISL coordinated pricing strategies, fixed flat steel prices, and exchanged commercially sensitive information, thereby distorting competition and harming consumers. The CCP inquiry report suggested that the steel cartel increased prices by an average of 111%, with raw steel prices surging by Rs146,000 per tonne over three years.
In determining the quantum of penalty, the CCP bench applied its Guidelines on Imposition of Financial Penalties, which emphasise two key objectives: deterring undertakings from engaging in anti-competitive conduct and reflecting the seriousness of the infringement. The bench evaluated the seriousness, duration, and aggravating factors of the violation before determining the penalty amount.
The order highlights that flat steel is a critical commodity in Pakistan’s economy, used in multiple sectors including construction, automotive, appliances, and agriculture. Any manipulation of prices in this essential market has a direct impact on consumers, businesses, and the overall economy.
The Chairman CCP observed that the steel sector in Pakistan remains largely unregulated compared to other jurisdictions such as China, India United States, the European Union, and the United Kingdom, where regulatory oversight ensures transparency and accountability. The Commission, therefore, underscored its responsibility to protect competition and consumers in such a vital sector.
The order further found that the cartel remained operational for more than three years—from July 2020 to December 2023. Evidence presented in the inquiry and subsequent proceedings confirmed that senior management, including the chief executive officers of both companies, were directly involved in the collusive conduct. No mitigating factors were identified that could reduce the culpability of either undertaking.
Consequently, the CCP Bench held that both undertakings had committed deliberate and prolonged violations of the Competition Act and were not entitled to any leniency. The penalties represent 1% of the annual turnover of each undertaking for the financial year 2021–2022. Both companies have been directed to deposit the penalty amount within 60 days from the date of the order. Failure to comply will result in an additional penalty of PKR 100,000 per day and may lead to the initiation of criminal proceedings under Section 38 of the Act.
