Displaying items by tag: Philippine Competition Commission

Philippines: The Philippine Competition Commission (PCC) expects to complete an investigation in alleged violations of competitive practice by the cement industry by 2019. PCC commissioner Stella Quimbo made the comments at a forum on the Philippines Competition Act (PCA), according to the Philippines Star newspaper. The investigation follows a probe earlier in 2017 in which the commission says it found reasonable grounds to proceed based on allegations made by the former trade undersecretary Victorio Dimagiba. According to a legal statement made by Dimagiba, the Cement Manufacturers Association of the Philippines (CEMAP), led by its president Ernesto Ordonez, Lafarge Holcim Philippines and Republic Cement and Building Materials violated the provisions of the PCA by engaging in anti-competitive agreements.

The Philippines has been messing up the balance sheets of cement producers so far in 2017. Over the last week Holcim Philippines, CRH and Cemex have each reported lacklustre first quarter results dragged down by poor performance in the country. CRH’s chief executive officer Albert Manifold seemed to receive the worst kicking when analysts in a conference call refused to let it pass that the company’s sales had dropped by 12% year-on-year in Asia. Although to be fair to him the group’s Asian division only represented 2% of global sales at Euro0.5bn…

CRH’s quarterly financial reports tend to be in the form of sparse trading updates. So this lack of detail and CRH’s plans to invest over Euro300m in the market may have prompted Manifold’s grilling. According to the Irish Times he blamed the situation on cheap imports from south-east Asia pulling down the price. He then defended the investment on the grounds that local producers would have an advantage as they increase production capacity due to constant production and ‘guaranteed’ regulation and certification.

CRH isn’t the only organisation that has been burned by the Philippines. Before Christmas this column was praising the local industry for being in a boom. Cement sales had risen by 10.1% year-on-year to 20.1Mt according to CEMAP data in the first nine months of 2016 and the Duterte Infrastructure Plan was starting to target hundreds of billions of US dollars towards infrastructure spending. In the end cement sales rose by 6.6% to 26Mt for the full year in 2016 and this was a solid performance despite being brought down by the fourth quarter.

From the cement producers mentioned above, Cemex reported that its Ordinary Portland Cement sales volumes fell by 9% in the first quarter. It blamed the fall on bad weather and a tough quarter to compare against in 2015. Holcim Philippines said that its net sales fell by 12% to US$176m and it attributed it to lower public infrastructure spending, tighter industry competition and higher production expenses. Eagle Cement meanwhile, the fourth of the country’s major producers, is preparing to float on the local stock market in May 2017 to fund an expansion drive. The poor results of the other three cement producers may dent its proceeds from the initial public offering (IPO).

The words CRH’s Albert Manifold used in his defence were that, “Brand matters over there.” Funnily enough the other big Philippines cement industry news story that has been rumbling away for the last few months is an investigation by the Philippine Competition Commission (PCC) into the conduct of the Cement Manufacturers Association of the Philippines (CEMAP) and some of the leading cement producers. Naturally this includes CRH’s joint venture Republic Cement. The enquiry was prompted in mid-2016 by the accusation of anti-competitive agreements by a former trade official. He also made direct allegations against Ernesto Ordonez, the head of CEMAP. The investigation is on-going and perhaps it will find out exactly how much ‘brand matters’ in the Philippines.

Philippines: Arsenio Balisacan, the chairman of the Philippine Competition Commission (PCC), says that the commission has 90 days in which to conduct an investigation into the local cement industry. It is expected to complete its probe in the first half of 2017, according to the Manila Bulletin newspaper. The investigation period follows the point at which the PCC found reasonable grounds of alleged violations of competitive practice. Potential fines the local industry could face are US$2m for a first offence and US$5m for a second.

The PCC announced in early March 2017 that was preparing to investigate the cement sector for alleged violations of competitive practice following a legal statement by Victorio Dimagiba, the head of Laban Konsyumer – a consumer rights organisation, accusing the Cement Manufacturers Association of the Philippines (CEMAP), LafargeHolcim Philippines and Republic Cement and Building Materials of engaging in anti-competitive agreements.

Philippines: The Cement Manufacturers Association of the Philippines (CEMAP) has asked that the local industry be treated fairly in an investigation by the Philippine Competition Commission (PCC). In a press statement, Ernesto M Ordoñez, President of CEMAP said that his association had not been notified or given a copy of a compliant filed by a legal firm, according to the Manila Bulletin. He added that the association’s lawyers had previously tried to find out more about the complaint in late January 2017 but had not had a reply.

"Fairness requires that both sides are heard. Not only were we not given a chance to be heard. More than a month after our letter to PCC asking for what the complaint is about so we could give our side, we still have no reply from PCC. We just found out about the nature of the complaint through the newspapers. This is one-sided and unfair, specially considering the track records of the subjects of the complaint," said Ordoñez.

The PCC announced in early March 2017 that was preparing to investigate the cement industry for alleged violations of competitive practice following a legal statement by Victorio Dimagiba, a former trade undersecretary, in August 2016 accusing CEMAP, LafargeHolcim Philippines and Republic Cement and Building Materials of engaging in anti-competitive agreements.

Philippines: The Philippine Competition Commission (PCC) is preparing to investigate the cement industry for alleged violations of competitive practice. It says it has found reasonable grounds to proceed to a full administrative investigation on the cement industry for possible violations of Sections 14 and 15 of the Philippine Competition Act, according to the Philippine Star newspaper. This follows a legal statement by Victorio Dimagiba, a former trade undersecretary, in August 2016 accusing the Cement Manufacturers Association of the Philippines (CEMAP), LafargeHolcim Philippines and Republic Cement and Building Materials of engaging in anti-competitive agreements.

Dimagiba has accused the cement producers of striking illegal agreements including, “restricting competition as to price or components thereof or other terms of trade, abusing their dominant position by engaging in conduct that substantially prevents, restricts, or lessens competition, imposing barriers to entry, or committing acts that prevent competitors from growing within the market.” He has also alleged that Ernesto Ordonez, the head of CEMAP, has used the trade association to justify violating the Philippine Competition Act, as well as maintaining prices of domestic cement in the retail market ‘unreasonably’ high.

Ordonez responded to the claims saying that he was puzzled about the PCC’s decision and that CEMAP had not been informed about a preliminary inquiry.