Exclusive | ECA monitors all commodity prices to avert monopolistic practices: Chairman
Updated 5/12/2024 3:47:00 PM
Arab Finance: The Egyptian Competition Authority (ECA) is currently monitoring the prices of commodities and key products of interest to the masses of citizens to prevent monopolistic practices, ECA’s Chairman Mahmoud Momtaz said in an exclusive statement to Arab Finance on May 12th.
His statements came on the heels of a recent decision taken by the ECA to initiate a criminal case against seven major poultry brokers for violating the provisions of Article (A/6) of the Competition Protection Law No.3 of 2003.
Specifically, these brokers were found to have colluded in setting the price for selling live poultry meat from white poultry fattening farms to wholesale traders. Such collusion has had adverse effects on market prices.
The ECA's decision follows a thorough examination of the white poultry fattening market, reflecting their commitment to scrutinize key sectors, particularly those impacting a wide swath of the population, such as the food industry.
It is worth noting that the structure of the poultry market in Egypt is divided into three tiers: breeders, brokers, and traders (both wholesale and retail).
The agency's investigation revealed compelling evidence of collusion among these brokers to fix prices. They communicated regularly, often announcing these prices via social media platforms, unofficially termed "poultry exchanges," to inform other brokers and market participants. This practice aimed to unify execution prices and manipulate the market, ultimately harming consumers.
Such price-fixing agreements are among the most damaging monopolistic practices, disrupting the free market mechanisms of supply and demand.
In a properly functioning market, each broker shall independently determine their prices, fostering competitive options for breeders and traders and ensuring consumers access to poultry at competitive prices.
The prices they set serve as benchmarks for other poultry brokers across Egypt, depriving breeders and wholesale traders of competitive pricing.
This decision by the ECA echoes a previous ruling by the Economic Court in October 2021, which fined five major poultry brokers EGP 30 million each, totaling EGP 150 million. They were found guilty of conspiring to fix prices for the sale of live white poultry meat.
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