The Philippine Competition Commission (PCC) found six businesses and their responsible officers liable for operating a cartel that divided up onion imports, cold storage and wholesale distribution, allowing them to control a substantial share of imported supplies.
The ruling followed an investigation triggered by the unprecedented price spike in late 2022, which put the spotlight on how onions were brought into the country and distributed nationwide.
“By imposing the maximum fines, the PCC underscores its commitment to holding cartels accountable across all sectors of the economy and protecting consumers from the harmful effects of anti-competitive conduct,” PCC executive director Kenneth Tanate said in a statement on Thursday.
Peeling back the scheme
Evidence seized during a September 2023 raid showed that freight forwarder Golden Shine International Freight Forwarders Corp. used other importers' credentials to secure permits, coordinate shipments and channel onions into cold storage facilities operated by Tian Long Corp.
By pooling import permits across several companies, the group controlled nearly half of all approved clearances for red and yellow onions in 2020 and 2021, concentrating access to imported supplies among businesses that were supposed to compete.
The PCC also found La Reina Fresh Vegetables & Young Indoor Plants Inc., Yom Trading Corp., Vegefru Producing Store and Rosal Fruit and Vegetable Trading liable for participating in the scheme.
A record penalty
The P1.76-billion penalty is the largest imposed under the Philippine Competition Act, with fines automatically tripled because onions are classified as prime commodities.
The commission calculated the penalties using actual import volumes and government wholesale prices after finding that the businesses had significantly understated their financial figures.
The May 28 ruling could also lead to separate criminal prosecution by the Department of Justice, exposing individuals involved to possible prison terms and additional fines.
—Edited by Miguel R. Camus
