ICCC News

The Independent Consumer and Competition Commission (“ICCC) wishes to inform industry stakeholders and the general public that it has declined to give Clearance to China Navigation Company Pte Ltd (“CNCO’’) to proceed with the proposed Acquisition of assets of New Pacific Line Pte Ltd (“New Pac’’).

The CNCo has applied for Clearance and Authorization to acquire the business and assets of NewPac (“Proposed Acquisition”). The applications were since registered for assessment.

ICCC Commissioner and CEO, Mr. Paulus Ain, stated that the ICCC has completed its competition effects assessment of the Proposed Acquisition, which is the first step in such applications.

“The ICCC has declined to give Clearance because the ICCC is not satisfied that the proposed acquisition will not, and will not be likely to, have the effect of substantially lessen competition in the markets for a range of shipping and related services including international liner cargo shipping services to and from Papua New Guinea; coastal shipping services and stevedoring and handling; shipping agency services; and downstream services and goods using any of those services in PNG.”

The ICCC will now proceed with the second step to assess the Authorization application to determine whether or not the Proposed Acquisition, although it has been denied on competition grounds, must be allowed based on public benefit grounds. In assessing the Authorization application, the ICCC must grant authorization if it is satisfied that the public benefits that may stem from the Proposed Acquisition will, or will likely to, outweigh the public detriments including lessening of competition. The ICCC must decline Authorization should it form a view that the public detriments outweigh public benefits put forward by the applicant.

The determination on the Authorization application is expected by 12th October, 2018.

ICCC’s Clearance Determination can be accessed on its website: www.iccc.gov.pg or interested stakeholders can contact the ICCC Head Office at Garden City, Boroko (NCD) to obtain a hard copy.

The Independent Consumer and Competition Commission (ICCC) is aware of the recent increase in data rates for the 4G services offered by Kumul Telikom Limited (Telikom).

ICCC Commissioner and Chief Executive Officer, Mr Paulus Ain, said “We express grave concern over the very high increase on the data rates.”

Mr. Ain stated that the ICCC’s role is not only to protect consumers from harmful business conduct; but to also ensure that business are able to compete fairly and effectively in a market so that they can earn sufficient profits to continue to invest in the business.

“Businesses should not be restrained from being able to charge rates for the services and products they provide. However, such rates should be fair and reasonable and that should reflect actual investments costs for the business in providing the service or product.”

In the meantime, the ICCC advises the public to exercise their choice if they feel aggrieved by the new data rates offered by the two companies and seek other alternative services provided by other operators that offer the same 4G services.

Whilst the exponential increase in Telikom’s data rates may be detrimental to consumers, the ICCC is limited in terms of its regulatory powers to take remedial actions. Currently, the ICCC does not regulate the prices of data services; hence, it cannot take actions against such increases that may be over and above a fair or reasonable price.

Consumers have protected rights under the ICCC Act. One of the most important rights being the “right to choice”. Depending on the facts surrounding the allegations of inflated prices, the ICCC may insist on Telikom to justifying its costs. In this regard, the ICCC will establish a dialogue with both Telikom and the industry regulator, the National Information and Communications Technology Authority (NICTA), to ascertain the basis of the sudden increase in the data rates.

The ICCC understands that an employee of Telikom came out in one of the dailies claiming that the increases were due to costs of vandalism and maintenance. The ICCC believes these reasons are not sufficient to justify a very huge increase because price increase may be spread overtime to recover such costs. 

The ICCC reiterates that Telikom should be reasonable and charge a price that is reflective of its costs so that they earn a fair return on their investment. Telikom should act as a good corporate citizen and be ethical in its conduct; and not using its near monopoly position in data services to their advantage by inflating prices unnecessarily to the detriment of the consumers. Telikom should be also cautious in its conduct as consumers may eventually switch to other operators who offer similar services.

Regarding whether this conduct of Telikom should be considered as abuse of its (near) monopoly position, the ICCC advises that the ICCC Act does not consider such price increases as abuse of monopoly position.

The Independent Consumer and Competition Commission (“ICCC”) hereby announces the new retail fuel prices for this month which will take effect on Wednesday, 08th August, 2018.

According to the ICCC’s calculations, retail fuel prices for petrol and kerosene will increase while the retail price for diesel will decrease throughout PNG as of 8th August, 2018. These retail fuel price movements are attributed to the price movements at the Import Parity Price (IPP) level for this month.

The domestic retail fuel prices for petrol, diesel and kerosene are inclusive of the IPP, domestic sea and road freight rates for the third quarter of 2018, the 2018 wholesale and retail margins for petrol, diesel and kerosene; including excise duty for petrol and diesel, 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 August, 2018

      372.52

      340.32

       315.70

Retail Prices as of 8th July, 2018

371.55

341.48

312.68

Price Variance (+/-) toea per litre

+0.97

-1.15

+3.01

 

ALL CENTRES

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

  • Petrol prices will increase by 0.97 toea per litre;
  • Diesel prices will decrease by 1.15 toea per litre; and
  • Kerosene prices will increase by 3.01 toea per litre.

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 2018) that are charged by the fuel distributors.

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;
  • Mr. Johnny Anderson, 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, 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, Mr. Banmu Olivi and Mr. Jeffery Khar will conduct compliance inspections in Goroka, Kainantu, Kundiawa and Mt. Hagen. They can be reached on telephone number 532 1077.

The prices set by the ICCC are the indicative maximum retail prices, for which retailers may choose to sell below the 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, 2018, 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 & Competition Commission (ICCC) as the sole consumer watchdog and the economic regulator in the country has expressed grave concern on the recent increase in hotel room rates in Port Moresby.

ICCC Commissioner and Chief Executive Officer, Paulus Ain said the hotel rates in the country, particular in Port Moresby started to increase during construction of the PNG LNG Project which saw thousands of expatriates, investors and business travellers’ flock to the city straining the limited supply of high-end rooms.

“That has created a supply constraint and available rooms have seen their rates increasing significantly. The demand has eventually eased off due to the completion of the PNG LNG Project, however, the hotel room rates have never subsided.”

In the last two or three years, there were more developments in hotel industry adding to new additional room with the expectation of the 2018 APEC Summit, hence, Port Moresby city appears to be well-positioned to meet an anticipated surge in foreign delegates arrival, despite delays on several high profile planned projects in the country.”

Commissioner Ain added that although there has been increase in the supply of hotel rooms, this is not reflected in the rates. Comparably, they are more expensive than some of the best hotels you find in another jurisdiction, including our very close neighbour economies.

“The room rates seem to be continuously increasing over the years, when will it decrease or when will the room rates come down?”

The ICCC views that supply of hotel rooms can be in excess of demand. This, according to Commissioner Ain, can cause a situation where some hotels can experience high room vacancy with falling revenue and profit.

Commissioner Ain said that given the increase in hotel rooms in Port Moresby compared to previous years, the hotel rates should be responsive to supply change.

“The room rates should decrease as the supply increases. Hotel supply has increased dramatically over the years in Port Moresby, but this change has not been reflected in the hotel room rates. The hotel room rates seem to be increasing significantly over the years.”

As the consumer watchdog, the ICCC is strongly urging all hoteliers to charge their rates prudently based on the real costs and the prevailing market conditions rather than on perception or historical trend or basing their price on their competitor’s rate. If the hotels reduce their room rates, we can encourage more tourist coming to our country, it can also increase potential investors coming to our country to look for potential investment opportunities and finally we can have more people travelling to PNG during the APEC period.  can benefit our APEC delegates and the country as a whole.

However, Commissioner Ain said all consumers have the right to choice, hence, they are encouraged to exercise their power of choice in seeking alternatives, if, a particular hotel room rates are excessive. That opportunity is limited given the current supply, therefore, price gouging by hoteliers should avoided.

The Independent Consumer and Competition Commission (“ICCC”) announces the new retail fuel prices for this month which will take effect on Sunday, 08th July, 2018.

According to the ICCC’s calculations, retail fuel prices (for petrol, diesel and kerosene) will all decrease throughout PNG as of 08th July, 2018. The decreases in retail fuel prices for this month are attributed to the decreases in their Import Parity Prices (IPP) for this month. The decreases in the IPP are mainly due to the decreases in crude oil prices in June, 2018.

The domestic retail fuel prices for petrol, diesel and kerosene are inclusive of the IPP, domestic sea and road freight rates for the third quarter of 2018, the 2018 wholesale and retail margins for petrol, diesel and kerosene; including excise duty for petrol and diesel, 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, 2018

371.55

      341.48

       312.68

Retail Prices as of 8th June, 2018

378.25

345.09

317.48

Price Variance (+/-) toea per litre

-6.7

-3.61

-4.79

 

ALL CENTRES

For all centers, the maximum retail fuel price for each fuel product in the country will decrease on average as follows:

  • Petrol prices will decrease by 6.55 toea per litre;
  • Diesel prices will decrease by 3.18 toea per litre; and
  • Kerosene prices will decrease by 4.22 toea per litre.

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 2018) that are charged by the fuel distributors.

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;
  • Mr. Johnny Anderson, 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, 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, Mr. Banmu Olivi and Mr. Jeffery Khar will conduct compliance inspections in Goroka, Kainantu, Kundiawa and Mt. Hagen. They can be reached on telephone number 532 1077.

The prices set by the ICCC are the indicative maximum retail prices, for which retailers may choose to sell below the 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, 2018, 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.