Philippines hits onion cartel with record fine for price surge

MANILA – The Philippines’ antitrust watchdog said it’s imposing record fine on several onion traders over their scheme that made the price of the vegetable more expensive than meat in 2022.The Philippine Competition Commission found six firms and their officers liable for “participating in an onion cartel that engaged in an illegal market allocation scheme” in the importation, cold storage and wholesale distribution of red and yellow or white onions, according to a statement on Oct 15.The alleged cartel members were fined a combined 1.76 billion pesos (S$35.81 million), the biggest penalty imposed by the commission to date.The case stemmed from an investigation after retail prices of onions surged to an unprecedented 800 pesos a kilo in late 2022.Onion prices at that time were about three times the price of chicken and around 25 per cent costlier than beef, pushing the South-east Asian nation’s overall inflation.The commission said its probe showed one cartel member systematically applied for sanitary and phytosanitary import clearances using other importers’ credentials, assigned the same importers as consignees, monitored permit allocations, and coordinated shipments. By accumulating permits across separate corporate entities, the cartel collectively controlled nearly 50 per cent of all import clearances for red and yellow onions in 2020 and 2021, routing imported shipments to cold storage facilities from where imported onions were distributed nationwide, according to the commission.“By imposing the maximum fines, the PCC underscores its commitment to holding cartels accountable across all sectors of the economy and protecting consumers from the harmful effects of anti-competitive conduct,” PCC executive director Kenneth Tanate said.Individuals involved in cartel activities may face criminal liability under the competition act, which imposes separate prison terms and additional fines upon prosecution, the competition body said. BLOOMBERG