ISLAMABAD, Jan 15: The World Bank has expressed concern over delay in the formal establishing of the Competition Commission of Pakistan, due to which, it said, it was becoming difficult to ensure good business practices across the country.

Informed sources told Dawn on Tuesday that the World Bank regretted that the government was delaying the formal launching of the Competition Commission by not paying it the promised seed money and by not allowing it to generate its own resources.

The bank has linked its proposed funding for the capacity building of the CCP with the release of much needed seed money and allowing it to generate different types of funding to run its affairs.

When approached, CCP chairman Khalid Mirza confirmed that the World Bank was equally concerned as to why the commission continued to remain dysfunctional.

“Yes the World Bank support for capacity building has been linked to government’s financial support to the commission,” he said.

He said he could not secure donor agencies’ support, including that of the World Bank, unless the commission gets seed money and type of resources from the government.

“Things are going wrong due to bureaucratic hurdles,” he complained, adding if necessary resources were not given, the commission would fail to fulfill its duties and that the government should realise the gravity of the problem.

Responding to a question, he said that the competition law was there, but it was not being implemented.

He asked the government to implement the law by providing necessary support to the commission.

“Under the worst case scenario, demoralisation is taking hold and it will not be long before when the commission will become a dysfunctional agency, perhaps a rogue agency,” Mr Mirza said.

The CCP chairman said it needed to function independently by having certain seed money as had been provided to many organisations when they were set up, including the SECP and Smeda.

“I don’t want to live on government’s subventions,” he said.

The Competition Commission was launched in place of the disbanded Monopoly Control Authority (MCA) on Nov 2, 2007.

The capacity building of the commission was also being delayed for which the World Bank had initially agreed to offer $6 million.

He said a law had been made, but no funding was given to him to run the organisation to ensure prudent business practices and at the same time discouraging illegal cartels. “I want clarity about my assignment,” Mr Mirza said.

Responding to a question, he said the World Bank wanted strict laws to ensure prudent business practices in Pakistan. It believed that as competition law is a law of general application, coordination, formalised or otherwise is needed to ensure effective application of responsibilities of the competition agency and other regulators in Pakistan.

Sources said that the World Bank has asked Pakistan to deepen and expand reforms to new and more complex areas.

The bank wanted the government to implement a competition policy aimed at having a strong competition culture throughout the economy, equal opportunities for all viable entities to participate in the economy, entrepreneurship and thereby developing a fertile ground for innovation, skills development and product diversification.

The bank also believed that a wide range of efforts were needed to remove unnecessary barriers to entry, created either by badly designed regulations and policies or by anti-competitive business policies by private firms.

At the same, time, the bank maintained that the implementation of explicit competition policy will need to avoid procedures that might pose unnecessary transaction or compliance cost on firms.

An effective competition policy framework involves a multifaceted set of initiatives, all of which are new to Pakistan, the bank said.

Sources said that the World Bank wanted Pakistan to promote sustainable economic development and improve the well-being of all citizens by protecting and promoting competition in the economy.

It said that private and public barriers to competition needed to be prevented from hindering the development path to guarantee maximisation of consumer and producer welfare in a dynamic framework.