ICCC News

The Independent Consumer and Competition Commission (“ICCC”) hereby announces the new retail fuel prices for this month, which will take effect on Sunday, 08th September, 2019.                     

According to the ICCC’s calculations, retail prices for petrol, diesel and kerosene will all decrease on average throughout PNG as of 08th September. The decrease in the retail prices is mainly attributed to the decrease in the international crude oil prices.

The domestic retail fuel prices for this month are inclusive of the Import Parity Prices (IPP), domestic sea and road freight rates for the third quarter of 2019, the 2019 wholesale and retail margins, excise duty, and the Goods and Services Tax (GST).

PORT MORESBY

As a result of adding all the various cost components mentioned above, the maximum retail prices for fuel in Port Moresby are as follows:

Port Moresby Retail Prices (toea per litre)

 

Petrol (tpl)

Diesel (tpl)

Kerosene (tpl)

Retail Prices as of 8th September, 2019

344.43

320.17

292.09

Retail Prices as of 8th August, 2019

355.10

328.90

301.03

Price Variance (+/-) toea per litre

-10.67

-8.73

-8.95

Retail prices in all other designated centres will change according to their approved in-country shipping and road freight rates (for the third quarter of 2019) that are charged by the fuel wholesalers.

ALL CENTRES

For all centers, the maximum retail fuel prices for each petroleum product in the country will change on average as follows:

  • Petrol prices will decrease by 10.67 toea per litre;
  • Diesel prices will decrease by 8.73 toea per litre; and
  • Kerosene prices will decrease by 8.95 toea per litre.

As part of the ICCC’s enforcement and compliance of fuel prices, its Investigation Officers will conduct inspections at all service stations to ensure prices of petroleum products do not exceed the allowable maximum prices. The following ICCC officers will conduct compliance inspections in Lae, Goroka, Kokopo and Port Moresby. Inspections in other provinces will be supported by our contacts in those provinces. Please note:

  • Mr. Christopher Gabesoa, Mr. Seri Tau Vali, Mr. Dennis Jerry and Mr. Bill Boiu will conduct compliance inspections to all service stations in the National Capital District. They can be reached on telephone number 325 2144;
  • Ms. Pamela Ipambonj and Mr. Timothy Ponau will conduct compliance inspections in Lae. They can be reached on telephone number 472 2859;
  • Mr. Bobby Tei, Mr. Roman Rosting and Mrs. Dorcas Baining Julai will conduct compliance inspections in Kokopo, Rabaul, Kerevat, Warangoi and Toma. They can be reached on telephone number 982 9711; and
  • Mr. Kevin Kondo and Mr. Jeffery Khar will conduct compliance inspections in Goroka, Kainantu, Kundiawa and Mt. Hagen. They can be reached on, following mobile numbers 7369 8251/ 7232 4861.

The prices set by the ICCC are the indicative maximum retail prices, for which retailers may choose to sell below the ICCC approved maximum price. The ICCC would like to remind retailers who sell fuel-using pumps to set fuel prices to one decimal place while the ICCC will continue to set the maximum price to 2 decimal places.

No fuel pump operator should charge above the Indicative Retail Price for this month’s price regardless of the number of decimals. This is to ensure compliance with the Prices Regulation Act under which the maximum prices of refined petroleum products are set. Retailers who are displaying prices to 1 decimal place are urged by the ICCC to round the prices down to ensure prices are within the allowable indicative retail prices. The ICCC Inspectors will continue to conduct spot checks after 08th September, 2019, to ensure on-going compliance by fuel operators.

Consumers are advised to report any instances of overcharging by retailers through the ICCC’s Consumer Protection Division on 325 2144, on toll free number: 180 3333 or by contacting our Regional Offices closest to you on the numbers provided above.

The Independent Consumer and Competition Commission (“ICCC”) hereby announces the new retail fuel prices for this month, which will take effect on Thursday, 08th August, 2019.                     

According to the ICCC’s calculations, retail prices for petrol, diesel and kerosene will all increase on average throughout PNG as of 08th August. The increase in the retail prices is mainly attributed to the depreciation of the PNG kina against US dollar in July, and the increases in the Singapore (refinery) prices for petrol, diesel and kerosene. Increases in the Singapore prices are mainly attributed to production outages as major refineries are being maintained and upgraded in preparation for a shipping industry shift to low sulphur fuels in 2020.

The domestic retail fuel prices for this month are inclusive of the Import Parity Prices (IPP), domestic sea and road freight rates for the third quarter of 2019, the 2019 wholesale and retail margins, excise duty, and the Goods and Services Tax (GST).

PORT MORESBY

As a result of adding all the various cost components mentioned above, the maximum retail prices for fuel in Port Moresby are as follows:

Port Moresby Retail Prices (toea per liter)

 

Petrol (tpl)

Diesel (tpl)

Kerosene (tpl)

Retail Prices as of 8th August, 2019

355.06

328.85

300.99

Retail Prices as of 8th July, 2019

341.66

319.05

291.05

Price Variance (+/-) toea per litre

+13.39

   +9.81

+9.94

 

Retail prices in all other designated centers will change according to their approved in-country shipping and road freight rates (for the third quarter of 2019) that are charged by the fuel wholesalers.

ALL CENTRES

For all centers, the maximum retail fuel prices for each petroleum product in the country will change on average as follows:

  • Petrol prices will increase by 13.39 toea per litre;
  • Diesel prices will increase by 9.81 toea per litre; and
  • Kerosene prices will increase by 9.94 toea per litre.

As part of the ICCC’s enforcement and compliance of fuel prices, its Investigation Officers will conduct inspections at all service stations to ensure prices of petroleum products do not exceed the allowable maximum prices. The following ICCC officers will conduct compliance inspections in Lae, Goroka, Kokopo and Port Moresby. Inspections in other provinces will be supported by our contacts in those provinces. Please note:

  • Mr. Christopher Gabesoa, Mr. Seri Tau Vali, Mr. Dennis Jerry and Mr. Bill Boiu will conduct compliance inspections to all service stations in the National Capital District. They can be reached on telephone number 325 2144;
  • Ms. Pamela Ipambonj and Mr. Timothy Ponau will conduct compliance inspections in Lae. They can be reached on telephone number 472 2859;
  • Mr. Bobby Tei, Mr. Roman Rosting and Mrs. Dorcas Baining Julai will conduct compliance inspections in Kokopo, Rabaul, Kerevat, Warangoi and Toma. They can be reached on telephone number 982 9711; and
  • Mr. Kevin Kondo and Mr. Jeffery Khar will conduct compliance inspections in Goroka, Kainantu, Kundiawa and Mt. Hagen. They can be reached on, following mobile numbers 7369 8251/ 7232 4861.

The prices set by the ICCC are the indicative maximum retail prices, for which retailers may choose to sell below the ICCC approved maximum price. The ICCC would like to remind retailers who sell fuel-using pumps to set fuel prices to one decimal place while the ICCC will continue to set the maximum price to 2 decimal places.

No fuel pump operator should charge above the Indicative Retail Price for this month’s price regardless of the number of decimals. This is to ensure compliance with the Prices Regulation Act under which the maximum prices of refined petroleum products are set. Retailers who are displaying prices to 1 decimal place are urged by the ICCC to round the prices down to ensure prices are within the allowable indicative retail prices. The ICCC Inspectors will continue to conduct spot checks after 08th August, 2019, to ensure on-going compliance by fuel operators.

Consumers are advised to report any instances of overcharging by retailers through the ICCC’s Consumer Protection Division on 325 2144, on toll free number: 180 3333 or by contacting our Regional Offices closest to you on the numbers provided above.

The Independent Consumer and Competition Commission (“ICCC”) hereby announces the new retail fuel prices for this month, which will take effect on Monday, 08th July, 2019.                     

According to the ICCC’s calculations, retail prices for petrol, diesel and kerosene will all decrease on average throughout PNG as of 08th July. The decrease in the retail prices is mainly attributed to the decreases in the crude oil prices and international sea freight in June.

The domestic retail fuel prices for this month are inclusive of the Import Parity Prices (IPP), domestic sea and road freight rates for the third quarter of 2019, the 2019 wholesale and retail margins, excise duty, and the Goods and Services Tax (GST).

PORT MORESBY

As a result of adding all the various cost components mentioned above, the maximum retail prices for fuel in Port Moresby are as follows:

Port Moresby Retail Prices (toea per litre)

 

Petrol (tpl)

Diesel (tpl)

Kerosene (tpl)

Retail Prices as of 8th July, 2019

341.66

319.05

291.05

Retail Prices as of 8th June, 2019

361.26

336.58

306.39

Price Variance (+/-) toea per litre

-19.59

-17.53

-15.34

Retail prices in all other designated centres will change according to their approved in-country shipping and road freight rates (for the third quarter of 2019) that are charged by the fuel wholesalers.

ALL CENTRES

For all centers, the maximum retail fuel prices for each petroleum product in the country will change on average as follows:

  • Petrol prices will decrease by 20.94 toea per litre;
  • Diesel prices will decrease by 19.12 toea per litre; and
  • Kerosene prices will decrease by 16.74 toea per litre.

As part of the ICCC’s enforcement and compliance of fuel prices, its Investigation Officers will conduct inspections at all service stations to ensure prices of petroleum products do not exceed the allowable maximum prices. The following ICCC officers will conduct compliance inspections in Lae, Goroka, Kokopo and Port Moresby. Inspections in other provinces will be supported by our contacts in those provinces. Please note:

  • Mr. Christopher Gabesoa, Mr. Seri Tau Vali, Mr. Dennis Jerry and Mr. Bill Boiu will conduct compliance inspections to all service stations in the National Capital District. They can be reached on telephone number 325 2144;
  • Ms. Pamela Ipambonj and Mr. Timothy Ponau will conduct compliance inspections in Lae. They can be reached on telephone number 472 2859;
  • Mr. Bobby Tei, Mr. Roman Rosting and Mrs. Dorcas Baining Julai will conduct compliance inspections in Kokopo, Rabaul, Kerevat, Warangoi and Toma. They can be reached on telephone number 982 9711; and
  • Mr. Kevin Kondo and Mr. Jeffery Khar will conduct compliance inspections in Goroka, Kainantu, Kundiawa and Mt. Hagen. They can be reached on, following mobile numbers 7369 8251/ 7232 4861.

The prices set by the ICCC are the indicative maximum retail prices, for which retailers may choose to sell below the ICCC approved maximum price. The ICCC would like to remind retailers who sell fuel-using pumps to set fuel prices to one decimal place while the ICCC will continue to set the maximum price to 2 decimal places.

No fuel pump operator should charge above the Indicative Retail Price for this month’s price regardless of the number of decimals. This is to ensure compliance with the Prices Regulation Act under which the maximum prices of refined petroleum products are set. Retailers who are displaying prices to 1 decimal place are urged by the ICCC to round the prices down to ensure prices are within the allowable indicative retail prices. The ICCC Inspectors will continue to conduct spot checks after 08th July, 2019, to ensure on-going compliance by fuel operators.

Consumers are advised to report any instances of overcharging by retailers through the ICCC’s Consumer Protection Division on 325 2144, on toll free number: 180 3333 or by contacting our Regional Offices closest to you on the numbers provided above.

The Independent Consumer and Competition Commission (“ICCC”) has proposed to decline authorizing Air Niugini Limited (“Air Niugini”) to partner with Philippine Airlines Inc. (“Philippine Airlines”) to provide code-share services between Port Moresby, PNG, and Manila, Philippines.

The ICCC is proposing this decision after assessing Air Niugini’s application and concluded that the POM/MNL route is already competitive; and introduction of this proposed code-share will stifle the current level of competition and reduce the current levels of benefits realized by the travelling public.

Commissioner and Chief Executive Officer, Paulus Ain said that the ‘free sale’ code-share arrangement is not very competitive and hence, it will lessen the level of competition in the market.

“The ICCC considers that in the present circumstances, it is better to have Air Niugini and Philippine Airlines to continue to operate independently on the Port Moresby and Manila route.” Commissioner Ain said.

Consistent with its draft determination which was released on 11th July, 2019, the ICCC considered that, if the parties proceed with the code-share arrangement, the benefits resulting from this will not outweigh the benefits realized currently while the two airlines operate independently.

Commissioner Ain said that with comments received from stakeholders and submissions from the parties, the ICCC assessed the application and is not satisfied that the code-share services, if authorized, would result in more benefits to the public.

In its assessment of the application, the ICCC has considered that;

  • The market is already competitive; and introduction of this proposed code-share will only stifle the current level of competition, including benefits realized by the travelling public.
  • The current market data on the route indicates that there is potential for growth in traffic volume because the volume has being increasing since Philippine Airlines entered the market independently. This adds to route development and travels become less costly for travelers. If the current level of competition is maintained, it is likely that traffic volume will continue to increase and potentially attract new carriers on the route.
  • The total of nine (9) flights weekly is sufficient to maintain or improve the current level of services enjoyed by businesses and other travelers in both countries, using passenger air services on POM/MNL route. The ICCC does not have any information that suggests that, without the code-share, services will reduce in frequency.
  • The structure of the proposed code-share agreement does not impose any significant costs on the airlines associated with unsold capacity, as distinct from a “hard block” basis were each airline commits to a certain level of capacity on the other airlines flights. Thus it provides little incentive for strong price competition. While the proposed code-share may result in increased travel choice for the traveling public, particularly for loyalty programme members, such arrangement is not likely to be good for consumers on a route that has only two players.
  • A significant reduction in airfares is unlikely to happen under the ‘free sale’ arrangement and there is significant risk of fares rising.
  • Competitive airfares, with code-share, will be possible if there is sufficient margin between how much the airlines would agree to pay each other (the “settlement amount or price”) and the ticket price (for each classes). However, since the marketing carrier would be incurring only minimal costs due to marketing and advertising, there is no, or very little, incentive for vigorous competition on airfares. The “hard block” arrangement does encourage strong competition on fares.  

The ICCC has also noted some market conditions that may contribute to hinder potential new entry. The ICCC has noted that availability of limited slots at the Port Moresby Jackson’s International airport could potentially inhibit new entries. The ICCC considers that despite the recent redevelopment at the Jackson’s Airport, there was no evidence which suggested that slot availability has increased. Should demand grow for passenger (and freight) services for international flights, new carriers may enter the market and provide air transport services. The limited availability of slots and how the slots are allocated could hinder the entrance of potential airlines. This would likely lead to delayed/missed opportunity to enhance competition on the incumbents; hence the likely benefits. This is the matter for the National Airport Corporation to assess and take appropriate steps, if deemed necessary to improve.

The ICCC also noted that regulatory requirements such as airline designation and capacity requirements as per bilateral agreements between PNG and Philippines can prove at times, to be challenging for a new carrier to enter. It is understood that before an airline could operate international services to another country, the government must first negotiate a treaty level agreement with the destination country’s government. PNG has a bilateral Air Service Agreement (ASA) with Philippines. Under the ASA, requirements such as traffic rights, capacity, designation, ownership and control, other policy, safety and security clauses would be included. Such regulatory requirements can make entry of a carrier into the international air transport services challenging; hence hinder potential effective competition. The State and the Department of Transport can consider this in the next bilateral ASA discussion with Philippines.

Based on the above considerations, the ICCC has proposed to decline authorizing Air Niugini to code-share with Philippine Airlines.

The Independent Consumer and Competition Commission (ICCC) would like to advise the public and business community that the ICCC has just been notified as per National Gazettal Notice No. G444 that the Independent Consumer and Competition Commission (Amendment) Act 2018 (N0.9 of 2018) is deemed to have come into operation on the 24th November 2018.

Therefore, as at 24th November 2018 to date, all business mergers and acquisitions are subject the new mandatory notification regime, as opposed to the former voluntary notification regime, subject to certain thresholds.

ICCC received the Notice of Commencement of the Independent Consumer and Competition Commission (Amendment) Act 2018.pdf (No.9 of 2018) [the Amendment] on 6th June 2019.

Basically, the Amendment was passed by Parliament on 25th July 2018. It was certified by the Parliament on 7th September 2018.

As per the Gazettal Notice; 24th November 2018, is the date fixed on which the Amendment is deemed to have come into operation or took effect. A copy of the Gazettal Notice can be obtained directly from the Government Printing office.

The ICCC Act prohibits business mergers or acquisitions that would have, or would be likely to have, the effect of substantially lessening competition in a market in Papua New Guinea.

The Amendment requires mandatory notification prior to consummation of a business acquisition or merger.

The ICCC Commissioner and Chief Executive Officer, Mr Paulus Ain (Mr. Ain) said that the ICCC has been proposing for this mandatory notification regime for some time now due to ICCC’s experience with a number of business mergers and acquisitions which have been consummated without the business(s) notifying or consulting the ICCC in the prior to the consummation and which had led to legal action taken by the ICCC against those businesses.

“With this new mandatory notification regime, the ICCC is now in a better position to protect the interests of consumers in preventing acquisitions that could be detrimental to consumers and as well as to the economy as a whole.”

Mr Ain also says that “The ICCC is now able to tackle the issue of big companies acquiring smaller ones to have greater control of the market, particularly where businesses were deliberately taking advantage of the previous voluntary notification regime”

Mr. Ain further added that “By having the mandatory notification regime in place, there will be increased liability and cooperation by businesses in providing relevant information or documentation to enable the ICCC to complete its review in a timely manner on behalf of the State.”

Mr. Ain says that this new mandatory notification regime as per the Amendment entails the following:

  1. mandatory notification is now required for business acquisition and mergers.;
  2. mandatory notification is now required for clearance of business acquisitions and mergers;
  3. there are key thresholds or conditions warranting the requirement of the mandatory notification;
  4. ICCC now has the power to impose conditions, revoke or amend any authorization determination that ICCC issues to applicants;
  5. ICCC can now direct businesses to submit an application for authorization.  Previously, businesses had the option to apply for authorization or clearance. This mandatory notification regime provides that if the ICCC is of the view that an application for authorization must be submitted instead of a clearance application, it will notify the relevant parties to submit an application for authorization; and  
  6. there is now a penalty provision for non-compliance.

Mr Ain says “Where the proposed acquisition meets either of the thresholds but the acquirer failed to notify the ICCC prior to the consummation of the acquisition; both parties to the acquisition will be fined K750, 000.00”

The ICCC appreciates that not all business acquisitions will pose competition concerns, hence, the thresholds are there to manage such circumstances. Mr. Ain strongly emphasises that “this, however, does not stop businesses whose circumstances do not meet the thresholds, to approach or consult ICCC, due to the fact that ICCC shall still take legal action if businesses are found by ICCC to be breaching s 69 of the ICCC Act. It is therefore, advisable that businesses cooperate and work with the ICCC to ensure that they do not breach s69 of the ICCC Act”.

Given the new Amendment, the ICCC has developed three guidelines to assist businesses in their application to notify the ICCC. These guidelines are:

  • the Confidentiality guideline;
  • the Business Acquisitions Review guideline; and
  • the Leniency Policy guideline.

The guidelines will soon be out for public use this year.

Mr. Ain encourages businesses to work with the ICCC at their earliest opportunity if they have any queries and concerns regarding a merger or an acquisition they intend to enter into.