Top Stories

Fowl play: 13 firms accused of price-fixing

CONSUMER CHOICES RESTRICTED: The Competition Commission of Singapore says


    Mar 09, 2016

    Fowl play: 13 firms accused of price-fixing

    THIRTEEN distributors, which supply more than 90 per cent of fresh chicken products here, have been accused of engaging in price-fixing.

    They have six weeks to defend themselves to the Competition Commission of Singapore (CCS) and could face fines if found to have infringed anti-competition rules.

    The 13 companies are accused of having met to discuss the timing and amount of price increases.

    The Straits Times reported last year that CCS started investigating the fresh chicken industry in late-2014 for price-fixing.

    Yesterday, a written notice was issued to the parties involved to set out the facts on which the commission has made its assessment, and give the reasons for its proposed decision.

    Investigations found that the parties met to discuss prices from at least 2007 to 2014 and also "expressly coordinated" the price increases of products.

    They also agreed not to compete for each other's customers during these discussions, the commission said.

    These restricted customers' choices and were aimed at distorting the prices of fresh chicken products here, it added.

    Under the Competition Act, business entities should not enter into any agreement or arrangement that prevents, restricts or distorts competition. They should instead respond independently to competition, said the commission.

    One of the affected firms, Kee Song Brothers Poultry Industries, met its lawyers yesterday to discuss its next step.

    James Sim, its group marketing manager, said: "What we did was to progressively adjust prices seasonally, according to demand and supply. When prices of seeds, corns and beans used to feed the chickens increase, we will also increase prices."

    The total turnover of the 13 firms amounts to about half a billion dollars annually. In 2014, about 46 million chickens were slaughtered and distributed here.

    The trade has two main parts: slaughtering and distribution.

    Distributors import chickens from farms in Malaysia and slaughter them here.

    They sell to customers such as restaurants, supermarkets, hotels, wet market stalls and hawker stalls.

    CCS has the power to fine companies up to 10 per cent of the turnover of their business in Singapore for each year of the infringement, up to a maximum of three years.