Probe on alleged resurgence of garlic cartel launched

MANILA, Philippines – Philippine Competition Commission (PCC), the country’s first anti-trust body, has launched its own inquiry into an alleged cartel involved in hiking garlic prices in the country.

“We launched preliminary inquiry yesterday [Monday, August 7]. The commission recently received from Senator Cynthia Villar a notice to looko into garlic industry,” PCC Chairman Arsenio Balisacan told reporters on Tuesday, August 8. Villar is the chairperson of Senate agriculture and food committee.

This announcement coincided with the lapse of the two-year transitory period for the Philippine Competition Act (PCA). The transitory period allowed affected parties time to renegotiate agreements or restructure their businesses to comply with the PCA.

Implementing rules and regulations of the PCA gives PCC 90 days to complete a preliminary inquiry into anti-competitive business practices. After the 90-day deadline, PCC will have to decide if there is a need to conduct a full-blown investigation. (READ: What you need to know about the Philippine Competition Act)

PCC director Orlando Polinar said the commission has been working with the Department of Agriculture to obtain information important to the inquiry. He also said PCC will review the 2014 report the Office for Competition of the Department of Justice (DOJ) on the alleged garlic cartel.

Looks back to 2014

Former Justice Secretary Leila de Lima said in 2014 that DOJ believes that 4 individuals were behind the steep increase in garlic prices despite abundant supply. (READ: DOJ: ‘Garlic cartel’ behind price spike, DA officials probed)

“Given the initial information we have, it will be useful for this investigation to go back to the 2014 incident, but thy are not treated as related cases,” Polinar said in a media briefing on Tuesday, August 8.

In June 2014, garlic prices caught the attention of Malacañang when they reached a high of P287 ($6.58) per kilo – a 74% increase within a one-year period and more than 100% increase from average prices.

About 73% of garlic demand is supplied by imports, while the remaining 27% comes from local sources, two years ago.

“After 90 days, we may come up with names involved. But it may not be publicly available because the next step to that is the full-blown investigation. We will just announce names when proven there is indeed price fixing and proven there is a need to penalize,” Polinar said.

According to Balisacan, the PCC may impose administrative fines of up to P100 million on the first offense and up to P250 million on the second offense. – Rappler.com