ISLAMABAD, Nov 11: The Monopoly Control Authority has decided to initiate investigation into alleged cartel and abuse of market power by the multinational pharmaceutical industry, particularly relating to vitamins sector, according to an official source.

In its meeting presided over by MCA Chairman Salim Asghar Mian, the MCA took serious view of the complaint from the public that the pharmaceutical companies had formed a cartel under which they had distributed among themselves production of particular kinds of vitamins.

As a result, a monopoly-like situation had risen in which the people had been deprived of their right of choice and were forced to purchase vitamins at high prices.

As it was the Authority’s view that, Mr Salim told Dawn, fair competition brought prosperity by building business and benefiting the general public, it would take strong action against anti-monopoly practices, particularly in sectors such as pharmaceuticals, pricing of gas, oil distribution, graphite electrodes, etc.

The Authority would also look into the monopoly being created in the marketing of mineral water by Nestle which recently bought out and merged Ava Mineral Water, and examine how it would affect the general public.

Taking further notice of the cartel-like situation prevailing in petroleum oil distribution, the Authority found it intriguing that all the companies were charging uniform prices for petroleum fuels. The price fixed by the OCAC from time to time was only the maximum price and it did not prevent various companies from charging lower price, it observed.

In reply to a question, the MCA chairman said the Authority had issued notices to various industries, including cement, car manufacturers, etc. The next step would be to issue show-cause notices to those companies which do not respond to its first notice by the due date.

He further stated that the Authority had proposed increase in penalties for violation of the Monopolies and Restrictive Trade Practices (Control) Ordinance, 1969. The existing penalties had lost their string over the past 33 years.

The value of a penalty in rupees that was equivalent to $25,000 had been reduced to $1,600, and that equivalent to $2,500 had been reduced to $160. The effective application of anti- monopoly law required that these be raised to levels commensurate with depreciated value of rupee, he added.