Competition watchdog fines 6 firms P1.76 billion in onion cartel case

MANILA — The Philippine Competition Commission (PCC) on Thursday announced that it has found six firms and their responsible officers liable for participating in an onion cartel that engaged in a market allocation scheme in the importation, cold storage, and wholesale distribution of red and yellow onions.

The respondents were fined a combined P1.76 billion.

The commission said the respondents engaged in anti-competitive agreements involving imported onions, with the investigation covering activities from 2020 to 2021.

The case stemmed from a sharp surge in onion prices in 2022, when retail prices reached as high as P800 per kilo.

“We did the investigation. Later on, we discovered there’s this group of companies… We discovered that there are indications of overlapping officers and directors and that’s how we started the investigation,” said Christian Loren delos Reyes, PCC Director for Enforcement Office.

In July 2024, the PCC filed charges against some onion importers for violations of Section 14 of the Philippine Competition Act, which prohibits anti-competitive agreements, including arrangements to divide or share markets.

Following the case, the Department of Agriculture also blacklisted the companies involved.

According to PCC, they found out that a freight-forwarding company used the credentials of respondent importers, assigned the same importers as consignees, monitored import permit applications and coordinated shipments.

The commission said the respondents controlled nearly 50% of all import clearances for red and yellow onions.

Imported onion shipments were also routed to cold storage facilities managed by one cold storage company.

The facilities involved in the case were located in Bulacan, Iloilo, Cebu, Cagayan de Oro and Davao City, although the alleged scheme affected the onion market nationwide.

“The commission ordered the respondents to permanently cease and desist from carrying out their agreement and pay their respecrive fines in 15 days from receipt of the decision,” said PCC Executive Director Kenneth Tanate.

Tanate said the fines were calculated using onion wholesale prices reported by the Philippine Statistics Authority (PSA) and the volume of onions involved. The penalties were also tripled because onions are classified as a prime commodity.

The PCC said it would coordinate with the Department of Justice on possible criminal charges.