ISLAMABAD: The Competition Commission of Pakis­­tan (CCP) has imposed a combined penalty of Rs1.5 billion on Aisha Steel Mills Ltd (ASML) and International Steels Ltd (ISL) for cartelisation and price-fixing, in violation of Section 4 of the Competition Act 2010.

The CCP’s bench, comprising Chairman Dr Kabir Ahmed Sidhu and Member Bushra Naz, found that the two companies coordinated pricing strategies, fixed flat steel prices, and exchanged sensitive commercial information. The penalties amount to Rs648.3 million for ASML and Rs914.2m for ISL — equivalent to 1pc of each firm’s annual turnover for 2021-22.

The commission noted that flat steel is a key input for various sectors, including construction, automotive, home appliances, and agriculture. The order highlighted that manipulation in this market impacts the broader economy, given its role in critical industries.

The CCP’s investigation found that both companies increased prices by an average of 111 per cent, with raw steel costs rising Rs146,000 per tonne over a three-year period, from July 2020 to December 2023. The cartel’s operations were uncovered through a formal inquiry launched in May 2021, following complaints of parallel pricing patterns among steel producers.

Price-fixing led to 111pc rise in flat steel prices from 2020 to 2023

On June 12, 2024, CCP conducted search and inspection operations at both firms’ premises, uncovering evidence of collusion, including identical price revisions and internal communication. CEOs and senior executives were directly involved, with no mitigating factors found to reduce liability.

The CCP issued show-cause notices in March 2025, and after reviewing the evidence, determined that the collusion was deliberate and sustained. No leniency was granted.

Both firms have been directed to deposit the penalty within 60 days. Failure to comply will attract an additional Rs100,000 per day in fines and possible criminal proceedings under Section 38 of the Act.

The CCP also noted the lack of regulatory oversight in Pakistan’s steel sector compared to jurisdictions like the US, EU, and UK, where stricter enforcement helps ensure market transparency.

Published in Dawn, October 9th, 2025