People’s Poultry and Hatchery filed Tk 7.2m for egg price manipulation

The Bangladesh Competition Commission (BCC) fined People's Poultry and Hatchery Limited Tk 7.2 million for colluding to artificially increase egg prices as well as manipulate supply in violation of the Competition Act, 2012.

The commission launched an investigation in 2022 based on a report from the Directorate of National Consumer Rights Protection, along with reports from various newspapers and electronic media.

The probe found evidence that People's Poultry and Hatchery had engaged in collusive practices with Kazi Farms Group, CP Bangladesh Company Limited, Diamond Egg Limited, and Egg Merchant Aratdar Bahumukhi Samabay Samity at Tejgaon in Dhaka to control egg prices and supply, says a press release.

The commission had filed a suo motu case against People's Poultry and Hatchery under the Section 15 of the Competition Act, 2012.

The charges included conspiratorial collusion, limiting or controlling production and supply, and setting artificially high purchase and sale prices.

The investigation report revealed that People's Poultry set egg prices 30-40 paisa (Tk0.3-0.4) above market rates by instructing traders through messages before dispatching eggs for sale.

The commission found that this price manipulation was coordinated with other companies.

Traders who refused to comply with the fixed prices were denied supply.

BCC says the company mixed hatching eggs with commercial red eggs and coerced traders into buying them at the price of commercial eggs (brown eggs).

Traders who resisted faced threats, including vehicle impoundment, forcing them to purchase eggs at the dictated price to avoid losses on transport costs.

During the price-fixing period, the wholesale market price of each egg was Tk 11.60-11.80, whereas People's Poultry and Hatchery Limited charged Tk 12 per egg, artificially inflating market prices, found BCC.

Following an investigation and subsequent hearings, the Commission concluded that People's Poultry and Hatchery Limited had engaged in anti-competitive practices.

The company’s actions, in association with other firms, resulted in an abnormal increase in egg prices and a restriction of supply—offenses punishable under Section 15 of the Competition Act, 2012.

Given that this was the first such case against the company, the Commission imposed a fine of Tk 7.2 billion (Tk 72,02,973), calculated based on the company’s average turnover over the past three years as per Section 20(A) of the Competition Act, 2012.

The company has been ordered to deposit the fine within 30 working days.

Failure to comply will result in an additional penalty of up to Tk 0.1 million per day under Section 20(C) of the Competition Act, 2012.

However, the company has the right to review or appeal the decision as per legal provisions.

However, the BCC earlier in Ocotber 2023 had slapped substantial fines on Kazi Farm and Saguna Foods for manipulating poultry market.

Kazi Farm, a household name in the poultry industry, was fined a staggering Tk 50 million while Saguna Foods Pvt Ltd Tk 34 million.

The action comes after a year-long investigation into the soaring prices of eggs and broiler in August 2022, which saw egg prices skyrocket to Tk 180 a dozen and broiler chicken to Tk 300 a kg.

The BCC initiated its probe in the wake of a public outcry over exorbitant prices that gripped the poultry market in August 2022.

tonmoy.wardad@gmail.com