PCC has started monitoring key players in the value chain which has the leverage to impose prices, including traders, wholesalers and millers.

The Philippine Competition Commission will probe traders, millers and wholesalers engaged in the distribution and facilitation of rice to the retail level.

The Philippine Competition Commission (PCC) on Wednesday said it is investigating middlemen in the rice supply chain to identify the presence of anti-competitive behavior in the industry following the surge of rice imports after the passage of the Rice Tariffication Law (RTL).

This comes as farmgate price for palay steadily falls, reportedly on the back of the implementation of the RTL, which saw higher rice imports to the detriment of local farmers who had to compete with the cheaper prices.

As of the third week of September, the average palay farmgate price has fallen 1.4 percent to P15.96 per kilogram compared to P16.18 per kg in the week prior.

The competition watchdog on 1 October also signed a memorandum of agreement with the Department of Agriculture (DA), the purpose of which, among others, is to assist the latter by “looking into market conduct that ultimately affect prices and output” in the agricultural sector, PCC said in an earlier statement.

Considering the mounting concerns on falling palay prices at the farmgate and, in contrast, the steady retail prices of rice, PCC commissioner Johannes Bernabe said the agency will probe traders, millers and wholesalers engaged in the distribution and facilitation of rice to the retail level.

“If some of them are in a dominant position, or worse if they are engaged in cartelistic behavior, then they will exacerbate the price gap between farmgate prices and retail prices, so that’s the role of PCC in this TWG (with the DA),” Bernabe told reporters at the sidelines of a forum in Cubao, Quezon City on Wednesday.

“If we are able to establish that there is anti-competitive behavior whether it’s in the form of cartel, or abuse of dominant position, then of course the Philippine Competition Act kicks in. In that case, we will have to enforce the full force of the law,” he added.

Violators of the competition law may face administrative fines ranging between P100 million to P250 million as well as face imprisonment of up to seven years.

Bernabe said that PCC has started monitoring key players in the value chain which has the leverage to impose prices, including traders, wholesalers and millers.

The PCC has also been recently issued inspection rules by the Supreme Court, which enable the facilitation of investigation and prosecution of those found to be violating provisions under the competition law. The rule will take effect on 16 November this year.