At the Crossroads: Making Competition Law Effective in Pakistan Symposium on Competition Law and Policy in Developing Countries

Wilson, Joseph | January 1, 2006

Just as the first merger wave of the late 1880’s in the United States resulted in the birth of Sherman Act, the recent global merger wave of the early 2000’s, coupled with the growing liberalization of trade, prompted a large number of developing and transitional economies to adopt competition laws. Pakistan is one of the few developing countries with a competition law in place for more than three decades: the Monopolies and Restrictive Trade Practices Ordinance of 1970 (“MRTPO” or the “Ordinance”). While the Ordinance contained fairly strong provisions, the agency entrusted to implement it, the Monopolies Control Authority (“MCA”), was rendered clawless by the social and legal framework, in addition to its staff’s lack of expertise. This deficiency, combined with the changes in the relevant national and global markets through increased trade across nations, and the growing presence and power of the multinational corporations (“MNCs”) has created an urgent need to overhaul the competition regime in Pakistan. Indeed the government of Pakistan, as this paper goes to press, is considering repealing the MRTPO and implementing a new Competition Act in its place. Similarly, the MCA will be replaced by a new National Competition Commission. This paper is divided into two parts. Part II of the article canvasses the history of the MRTPO, describes its various provisions, outlines the organizational framework of the MCA, and documents its enforcement record. Part III makes recommendations for ensuring the effectiveness of the new Competition Authority in implementing the new Competition Act.