Dominant position

2025 CLD 15 ISLAMABAD Judicial Precedent

Ss. 30, 31 & 37Constitution of Pakistan, Art. 199Constitutional petitionDominant positionScope

Petitioner company was refused no objection certificate by Pakistan Hockey Federation to convene junior hockey league event

Petitioner company assailed report of Competition Commission declining to initiate proceedings for absence of dominant possession of Pakistan Hockey Federation

Validity

Requirements of fairness were satisfied as petitioner company was given ample opportunity to make out a case by inquiry committee that Pakistan Hockey Federation had abused its dominant position

Despite such opportunities, petitioner company failed to make out such case and the reasons for forming opinion documented in Inquiry Report

Competition Commission did not deal with petitioner company unfairly or that there existed, in terms of S. 37 of Competition Act, 2010 an independent right to adjudicatory hearing, before the Commission had decided to file the complaint

Pakistan Hockey Federation was not occupying dominant position in market for junior hockey league, nor could it be presumed that the Federation was abusing its position by refusing to issue no objection certificate to patronize petitioner company in convening junior hockey league as a commercial sporting event

High Court in its extra ordinary Constitutional jurisdiction declined to interfere in the matter as petitioner company failed to point out that opinion of Competition Commission suffered from illegality, irrationality or procedural impropriety

Competition Commission of Pakistan as a statutory regulator, had expertise to form opinions within the domain prescribed by the Legislature in terms of provisions of Competition Act, 2010 and exercise of such regulatory power, where it did not infringe on fundamental rights of the citizens, ought not be subjected to searching scrutiny by the Court

Constitutional petition was dismissed, High in circumstances.

2017 CLD 881 COMPETITION COMMISSION OF PAKISTAN Judicial Precedent

Ss. 2(1)(e) & 3Dominant position

Allegation of abuse of dominant position by Management of a Residential Colony by depriving the residents of alternate C.I.T. Cable Operator

Preventing, restricting, reducing or distorting competition in the relevant market

Effect

When a dominant undertaking that owned and/or controlled itself uses and had the ability to grant the right to use an essential facility i.e. a facility or an infrastructure without access to which other undertaking could not provide competing services to the end, consumers, refused competitors to access such facility or granted access to competitors only on terms less favourable than those what it gave to others, it placed the undertaking at a competitive disadvantage, which were exclusionary practices and strictly prohibited under S.3(1) read with Ss.3(3)(e) and 3(3)(h) of the Competition Act, 2010

Proprietary rights arising from a utility corridor serving public purpose, whether owned and/or managed by the municipality or a private body, were essentially public utility corridors

Conduct of the Management of Residential Colony was adversely affecting competition in the provision of 'C.I.T.' services within the relevant market i.e. the Residential Colony, had also failed to provide any rational, commercial or objective justification in terms of efficiency gains for its exclusionary and anti-competitive conduct

Such was discoursing the investors to the consumer's detriment and proliferation of 'C.I.T.' services, which in terms was affecting the national economy as well competition inter se the service providers, which was actionable under the Competition Act, 2010

Competition Commission held that the Management of the Residential Colony had abused its dominant position in the relevant market and imposed on the Management a penalty of Rs.2000,000 (Two million rupees)

Competition Commission refrained from imposing higher penalties which ordinarily would have been appropriate considering the impact of exclusionary practices in contravention of S.3 of the Competition Act, 2010 of the act by the Management.

2016 CLD 871 COMPETITION COMMISSION OF PAKISTAN Judicial Precedent

Ss. 11, 3 & 2(1)(e)Competitive (Merger Control) Regulations, 2007, Reglns. 3 & 4Merger, approval ofDominant positionSubstantial lessening of competition/strengthening of dominant position in relevant marketVertical/unilateral horizontal effects of merger and countervailing factorsEfficiencies/benefits of merger in post-merger scenario

Karachi Stock Exchange Limited (KSE), Lahore Stock Exchange Limited (LSE) and Islamabad Stock Exchange Limited (ISE) jointly submitted the pre-merger application for their formation as "Pakistan Stock Exchange" (PSE)

Under Phase I Review Order, the proposed merger had met both the thresholds prescribed under Regln. 4 of Competitive (Merger Control) Regulations, 2007 and the presumption of dominance prescribed under S. 2(1)(e) of Competition Act, 2010, and competition concerns raised under the Order included potential impact on listing of companies, on brokers, on future exchanges and on other exchanges

Commission, having analyzed the vertical effects, unilateral horizontal effects of the proposed merger and countervailing factors regarding the same, observed that Karachi Stock Exchange had been the dominant player in the relevant market, both in terms of share of trading volume as well share of turnover, and following the transaction/merger Pakistan Stock Exchange would be the sole dominant undertaking holding 100 % of the market share

Pakistan Stock Exchange, as dominant undertaking in the market, would not be able to create any legal hurdles for new entrants, either in the same segment or even in other specialized areas of financing

Commission, however, finding the undertaking engaged in abuse of its position at any time in the post-merger scenario, had power to penalize the undertaking and rectify such situation under S. 3 of Competition Act, 2010

Commission, also considered the efficiencies, which were expected to be achieved as result of the proposed merger, including benefits to the relevant market, benefits to brokers and benefits to investors

Said efficiencies to be gained by the proposed transaction far outweighed the possible anti-competitive effects which might result from the elimination of competitors in the market

In view of the analysis, therefore, the proposed transaction/merger did not substantially lessen competition in the relevant market

Commission approved the proposed merger but subject to certain conditions imposed on the Pakistan Stock Exchange and recommendations made to the Securities and Exchange Commission of Pakistan for taking measures in the post-merger scenario to safeguard the competition

Pre-merger application was allowed.