13 chicken suppliers accused of 'fowl play' over prices

Thirteen fresh chicken distributors have been accused of engaging in price-fixing.
Thirteen fresh chicken distributors have been accused of engaging in price-fixing.PHOTO: ST FILE

Thirteen fresh chicken distributors, which supply more than 90 per cent of fresh chicken products here, have been accused of engaging in price-fixing.

They now have six weeks to defend themselves to the Competition Commission of Singapore (CCS) and could face fines if they are found to have infringed anti-competition rules. The 13 companies are accused of having met to discuss the timing and amount of price increases.

The Straits Times reported last year that the CCS started investigating the fresh chicken industry in late 2014 for price-fixing.

Yesterday, a written notice was issued to the parties involved to set out the facts on which the commission has made its assessment and gave the reasons for its proposed decision. Investigations found that the parties met to discuss prices from as early as 2007 to 2014 and also "expressly coordinated" the price increases of products. They also agreed not to compete for one another's customers during these discussions, the commission said.

The actions restricted customers' choices and were aimed at distorting the prices of fresh chicken products here, it added.

Under the Competition Act, business entities should not enter into any agreement or arrangement that prevents, restricts or distorts competition. They should instead respond independently to competition, said the commission.

One of the affected firms, Kee Song Brothers Poultry Industries, met its lawyers yesterday to discuss its next step.

Mr James Sim, its group marketing manager, said: "What we did was to progressively adjust prices seasonally, according to demand and supply. When the prices of seeds, corn and beans used to feed the chickens increase, we will also increase prices."

The total turnover of the 13 firms amounts to about $500 million annually.

The fresh chicken industry here has two main parts: slaughtering and distribution.

Distributors import live chickens from farms in Malaysia and slaughter them here, after which they sell the fresh chicken products to customers such as restaurants, supermarkets, hotels, wet market stalls and hawker stalls.

The CCS has the power to fine companies up to 10 per cent of the turnover of their business in Singapore for each year of infringement, up to a maximum of three years.

Teacher Soh Ying Fang, 55, said of the CCS findings: "Chicken is a staple in most kitchens. Let's hope that we've not been victims of the... (suppliers') collusion."

A version of this article appeared in the print edition of The Straits Times on March 09, 2016, with the headline '13 chicken suppliers accused of 'fowl play' over prices'. Print Edition | Subscribe