dimagiba NEW - Anti-trust issues on suggested retail prices

On October 19, 2020, in my capacity as President of Laban Konsyumer Inc.  (LKI), I wrote the Chairman and Members of the Philippine Competition Commission (PCC).

In that letter, I informed the PCC that my objective for writing them was to ensure that the safety nets of the Suggested Retail Prices (SRPs) are not being used at any stage of the supply chain for pork  to reduce, restrain, collude, and lessen the competition. I pointed out that the very high retail prices of pork due to maneuvers such as these result in making life more difficult and harder for consumers during this period of pandemic and quarantine.

I further pointed out thatunder the law, any form of partnership in the supply chain which may result in easing out honesttogoodness competition and resulting in higher prices over and above the SRPs lessen choices for the consumers and place the consumers helpless in the hands of the retailers.

I explained to the PCC that fresh pork is listed under Basic Necessities in Section 3 (1) of the Price Act (RA 7581 as amended. Pursuant thereto, the Price Act authorizes the implementing agency ( in this case, the Department of Agriculture) to issue from time to time, the suggested  reasonable retail prices for any or all basic necessities and prime commodities under its jurisdiction, for the information and guidance of producers, manufacturers, traders, dealers, sellers, retailers, and consumers.

This year , the Department of Agriculture has issued  four (4) SRPs for pork products , i.e. on February 20, April 17,  June 25  and the latest on  October 29, 2020 . The SRPs per kilo for fresh pork ham/kasim were set at P190.00 and P230.00 while SRPs per kilo for fresh pork liempo were set at P225.00 and P290.00 respectively.

As of October 29, 2020, the SRPs were further increased to P260.00 per kilo for pork kasim and to P280.00 per kilo for pork liempo.

Notwithstanding these SRPs, as of October 24,2020, the monitored prevailing retail prices of pork ham/kasim and liempo per kilo shot up to P 300.00 and P340.00, respectively, which are way in excess of the new SRP set on October 29, 2020.

And to my shock, as of October 29, 2020, pork liempo costs P 417.00 a kilo in a large supermarketin Quezon City.

I informed the PCC that the country has enough supply of pork in spite of lingering health issues in isolated commercial hog farms or backyard hog farms and the never-ending tussle among the regulators, producers, and importers on the policy of allowing or banning importation. Inventory data that I submitted to the PCC  shows that as of October 2020, frozen pork in accredited cold storage is 7,500 MT local hogs and 36,645 MT imported pork, as against 3,470 MT of local hogs and 35,460 MT a year ago.

I believe that consumers are entitled to hear, learn, and understand from the Philippine Competition Commission that there no acts of illegal price manipulation happening in the supply chain of pork.

In my letter which PCC received on October 19, 2020, I stated that in seeking investigation and action from the Philippine Competition Commission, I invoked Section 41 of RA 10667 or the Philippine Competition Act which states that “if the violation involves the trade or movement of basic necessities and prime commodities as defined by RA 7581 as amended, the fine imposed by the Commission or the courts, as the case may be, shall be tripled.

My letter was endorsed by PCC to its Enforcement Office for proper action. In their reply dated October 27, 2020 via email that Office said “xxx we agree with you that no firm or entity should be able to engage in illegal price manipulation in the supply chain of pork, or in the supply of any product for that matter. If you have any additional information on specific conduct on the part of certain firms that is anticompetitive, this will significantly help us to conduct a more targeted inquiry on the matter raised in your letter xxx”.

In response, I shared with that office the warning made by a hog raiser  stakeholder that prices of pork can go up to P400.00 per kilo. It is my honest opinion that this statement will further aggravate and exert upward pressure on the retail prices of pork.

I believe that with the intervention of the PCC, we can in rein the upward movement of the retail prices of pork. The PCC should befelt as an ally of the consumers.The data I submitted were taken from the websites of the Philippine Statistics Authority, Department of Agriculture, National Meat Inspection Service and television news footage. 

Atty. Vic Dimagiba is President of Laban Konsyumer Inc.

Email at labankonsyumer@gmail.com

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