The Independent Consumer and Competition Commission (“ICCC”) hereby announces the new retail fuel prices for the month of November. These prices will come into effect on Thursday, 08th November, 2018.
According to the ICCC’s calculations, retail fuel prices for petrol will decrease while the retail prices for diesel and kerosene will increase throughout PNG as of 08th November.
The decrease in the retail price for petrol is attributed to the decrease in the Singapore prices for petrol in the previous month, while the increase in the retail prices for diesel and kerosene is also attributed to the increase in their Singapore prices in the previous month.
Fuel prices will continue to be influenced by factors beyond the control of ICCC. The recent price increases are primarily driven by the world market price for crude oil, the depreciation of the kina against the US dollar and international freight rates. Future price movements will also be influenced by geo-politics in the Middle East especially between Saudi Arabia and Iran. The reintroduced sanctions by the United States of America (USA) on Iran will cut off a significant amount of supply of crude oil from the world market. This has the potential to drive up crude oil prices even further and subsequently increase fuel prices even further.
The domestic retail fuel prices for petrol, diesel and kerosene are inclusive of the Import Parity Prices (IPPs), domestic sea and road freight rates for the last 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).
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)
Retail Prices as of 8th November, 2018
Retail Prices as of 8th October, 2018
Price Variance (+/-) 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 last quarter of 2018) as charged by respective fuel wholesalers.
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 2.54 toea per litre;
- Diesel prices will increase by 9.37 toea per litre; and
- Kerosene prices will increase by 10.34 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, 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 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 use fuel pumps to sell fuel 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 that may require rounding-off. 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 November, 2018, to ensure on-going compliance by fuel operators. Non-complying operators will be prosecuted.
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) would like to advise the industry stakeholders and general public that it has issued an electricity generation licence to Markham Valley Biomass Limited (MVBL) to generate and supply power.
The Generation licence is issued to MVBL following its compliance of all the licensing requirements under the Electricity Industry Act (EIA) and other industry legislations and regulations.
MVBL is a subsidiary of Oil Search Limited and has a Power Purchase Agreement (PPA) with PNG Power Limited (PNG Power) to generate 15 megawatts of power from biomass in Markham Valley, Morobe Province and supply to PNG Power through its Ramu Grid.
ICCC Commissioner and Chief Executive Officer, Paulus Ain said that MVBL submitted its licence application to the ICCC on 17th July 2017 for review and approval.
“The licence application was submitted after its PPA (including power purchase price) with PNG Power was reviewed and approved by the ICCC.”
“As a requirement under the Electricity Industry Policy (EIP), a copy of the MVBL’s application was forwarded to the Electricity Management Committee (EMC) to review the technical aspect of the application concurrently with ICCC’s internal assessment.
“On the 22nd of August, 2018, the EMC provided its assessment and recommendation to the ICCC.”
Commissioner Ain said that after having assessed the MVBL’s application to be consistent with section 24E and 24F of the EIA and taking into consideration EMC’s recommendation, the ICCC considers MVBL to be a suitable entity to hold a generation licence.
The approval of MBVL’s generation licence, brings the total number of electricity undertakers operating in the generation segment of the electricity industry to nine.
PNG Electricity Supply Industry is separated into four segments: generation, transmission, distribution and retail with licences issued for each segment. The following are current licence holders with their various licences;
- PNG Power Limited- Generation, Transmission, Distribution and Retail
- Lihir Gold Limited-Generation, Distribution and Retail
- PNG Forest Products- Generation, Transmission, Distribution and Retail
- Ok Tedi Mining Limited- Generation, Transmission, Distribution and Retail
- New Britain Palm Oil Limited- Generation
- Posco Daewoo PNG Limited -Generation
- Daewoo Power PNG Limited -Generation
- Exxon Mobil PNG Limited -Generation
Some of these licence holders operate in off-gird isolated centers producing power for their core business operations and supply access power to nearby communities and business, while others are mostly Independent Power Producers (IPPs) who generate and supply their excess or wholesale power to PNG Power under a PPA.
The generation segment of the electricity industry is now open to competition as facilitated through the Third Party Access (TPA) Code managed by the ICCC. TPA Code facilitates third party access arrangement between network owner such as PNG Power and IPPs by setting out access rules and guidelines including the pricing mechanisms.
Commissioner Ain added that since the establishment of TPA Code by the ICCC in 2014, there has been a growing interest from industry players to participate in the large load market (greater than 10 megawatts) of the generation segment.
“Electricity undertakers who wish to participate in the PNG Electricity Supply Industry are advised to submit their licence applications to the ICCC in a form approved by the ICCC.”
The Independent Consumer and Competition Commission (“ICCC”) wishes to inform relevant stakeholders and the general public that it has revoked authorization determinations A2015/18 and A2016/24 for code-share arrangements between Air Niugini and Qantas.
The revocation is based on the decision of Air Niugini and Qantas to cease the code-share services between various Papua New Guinean and Australian routes which amounted to a material change of circumstance pursuant to Section 80 of the ICCC Act.
The ICCC Commissioner and CEO, Paulus Ain, said authorization A2015/18 was granted on 22nd April, 2016 for three years, for Air Niugini to continue its code-share arrangement with Qantas for the Port Moresby–Brisbane (POM/BNE) and Port Moresby-Sydney (POM/SYD) routes.
“The Port Moresby–Brisbane sector code-share covers both passenger and freight component while Port Moresby-Sydney only covers passenger services.”
Authorization A2016/24 was granted on 09th November, 2016 for Air Niugini to enter into and give effect to a code-share agreement with Qantas, on a “free sale” basis, on flights operated by Air Niugini between Port Moresby and Cairns (POM/CNS) for a period of five (5) years, commencing from 10th November, 2016.
Mr Ain said that on 16th February, 2018, Qantas submitted an application to the International Air Service Commission (“IASC”) of Australia requesting a variation on existing capacity determinations to permit the utilization of capacity for code-share services with Air Niugini on a free sale basis.
“However, on 30th April, 2018, the IASC released its draft determination proposing not to allow Qantas to vary its determination relating to the code-share arrangements with Air Niugini on the PNG routes to free sale. Consequently, Qantas withdrew its application from the IASC on 16th May, 2018.”
“Air Niugini then advised the ICCC of the situation and indicated that the code-share services with Qantas effectively ceased on 1st July, 2018.”
Mr. Ain explained that the cessation of the codeshare services by the parties amounted to a material change in circumstance prompting the ICCC to revoke the mentioned authorizations and related variations.
The detailed revocation determination can be accessed via the ICCC website: www.iccc.gov.pg or you can visit the ICCC Head Office at Level 1, Garden City, Boroko to obtain a copy.
The Independent Consumer and Competition Commission (ICCC) is warning all Public Motor Vehicle (PMV) operators in the National Capital District (NCD) not to charge passengers above the current ICCC approved PMV fares for urban and non-urban routes in 2018 . A number of complaints received and recorded at the ICCC office relate to PMVs charging above the ICCC approved fare of K0.90 for all routes in NCD. The reason for the overcharging is a result of the current road construction in various parts of the city causing traffic congestion.
ICCC Commissioner and CEO, Paulus Ain said PMV operators are reminded to refrain or immediately cease this conduct/practice or will be prosecuted under the Prices Regulations Act (PR Act) and the Independent Consumer and Competition Commission Act 2002 (ICCC Act).
“The ICCC will continue to monitor through its complaints help desk those PMVs that are overcharging commuters during short trips on a route, particularly for routes 9 and 11 travelling from 4 mile to Waigani and Gerehu.”
Commissioner Ain also encouraged passengers to assist the ICCC by providing the following details to the ICCC office:
- Plate number of the bus;
- The particular route the offence occurred;
- The time of the day and the date the offence occurred;
- The name of the owner of the bus (written on the driver’s door);
- Any distinguishing descriptions of the bus; and
- Complainant’s name and contact details.
The above details can be provided by contacting the ICCC by telephone on 325 4615 or 325 2144 , or by walking in at the ICCC Head office located on the 1st Floor, Garden City Building, Boroko. Alternatively you can visit our website: www.iccc.gov.pg or ICCC Facebook page and twitter iccc.com.
Commissioner Ain said that the ICCC has prosecuted offending PMVs in the past and will not hesitate to do so if this trend continues in the coming weeks.
“The ICCC is also calling on the NCD National PMV Association to inform the PMV owners and operators to be considerate and respect the law. Charging of PMV fares above the approved maximum fare is an offence under the PR Act.”
The penalties under the PR Act range from:
- a fine not exceeding K600 or imprisonment of up to 6 months, if prosecuted at the District Court; and
- a fine not exceeding K3,000 or imprisonment of up to 2 years; if referred to a higher Court.
PMV owners are urged to immediately cease charging above the ICCC approved rates.
The Independent Consumer and Competition Commission (“ICCC”) has issued a Statutory Notice to Paradise Company Limited (“Paradise”) to provide information relating to the acquisition of Laga Industries Limited (“Laga”).
The information requested is necessary for the ICCC to investigate the acquisition and would assist the ICCC in performing its statutory functions set out in the ICCC Act 2002.
The ICCC Commissioner and Chief Executive Officer, Mr. Ain, revealed that the ICCC became aware of this acquisition on 03rd July, 2018 when news of the acquisition was published in the newspapers. Following the publication, the ICCC sought specific information from Paradise on 05th July, 2018 relating to the acquisition of Laga. Paradise was requested to provide the information to the ICCC by 20th July, 2018. However, Paradise has not complied in providing the information to the ICCC as requested.
“Given the fact that both Paradise and Laga are two well-established competitors in the food and beverage manufacturing industry in Papua New Guinea, there are genuine competition concerns that would require the ICCC’s thorough assessment and verification. As a result, a competition assessment is necessary for this acquisition.” Mr. Ain said.
Mr. Ain further stated that, “The ICCC has now served Paradise a Statutory Notice under Section 128 of the ICCC Act for it to provide the requested information and failure to comply will mean a contravention of the ICCC Act. The penalties for non-compliance of a Statutory Notice issued under Section 128 of the ICCC Act includes court ordered fines of K50,000.00 or imprisonment for a term of six months.”
“We gave Paradise sufficient time to provide the necessary information and even sent a follow-up letter to Paradise on 16th August, 2018. However, Paradise has neither responded nor provided the requested information to date, ” Mr. Ain added.
The ICCC also reserves its rights to institute legal action in Court to challenge the acquisition if it forms a concluded view that the acquisition would, or would be likely to substantially lessen competition in PNG.