PCC to look into cold-storage cartel in onion industry

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By Janina C. Lim, Reporter

THE Philippine Competition Commission (PCC) said it will look into the Department of Agriculture’s (DA) complaint on the alleged cold-storage cartel in the onion industry.

“PCC will look at the alleged refusal of storage access to onion farmers in favor of large traders and will also evaluate if there are business agreements that are anticompetitive or enablers of cartelistic behavior,” the anti-trust agency said in a Friday statement.

“Specifically, PCC will examine whether there are competition concerns in the onion industry such as restriction of storage space or price manipulation by cartels, or whether the storage concerns are natural consequences of supply conditions,” it added.

Cold storage facilities form an important part in the value chain to prolong the shelf life of onions after harvest season.

On March 20, the DA requested the PCC and the National Bureau of Investigation (NBI) to investigate reports that trading firms have closed down four major cold-storage facilities in an attempt to compel farmers to sell at low prices.

The DA recently suspended the importation of bulb onions pending the results of the investigation of both agencies. PCC said the investigation should not prevent the DA from exercising its own judgment in suspending or allowing importation.

PCC also proposed signing a memorandum of agreement with the DA “to harmonize the objectives of both agencies of fostering fair market competition and promoting agricultural growth.”

Republic Act 10667 or the Philippine Competition Act of 2015 prohibits businesses from forging anti-competitive agreements which, among others, restrict competition in price and other components related to the trade.

The competition law punishes those engaged in cartels with a fine of P100-P250 million and imprisonment of up to seven years.