13 chicken distributors face price-fixing accusations: Competition Commission of Singapore

The 13 fresh chicken distributors now have six weeks to submit a defence and could face fines if found to have infringed anti-competition rules.
The 13 fresh chicken distributors now have six weeks to submit a defence and could face fines if found to have infringed anti-competition rules.PHOTO: ST FILE

SINGAPORE - Thirteen fresh chicken distributors, making up more than 90 per cent of the market in Singapore, have been issued a proposed infringement decision for price-fixing by the Competition Commission of Singapore (CCS).

The written notice, which lays out the facts for its proposed decision, was issued on Tuesday (March 8) and claims the companies engaged in anti-competitive agreements to coordinate the amount and timing of price rises, and agreed not to compete for each other's customers.

The distributors now have six weeks to submit a defence and could face fines if found to have infringed anti-competition rules.

The CCS' investigations found that the parties involved engaged in discussions from at least 2007 to 2014.

The total turnover of the 13 distributors comes to about half a billion dollars annually. In 2014, about 46 million chickens were slaughtered and distributed here.

The companies are Gold Chic Poultry Supply, Hua Kun Food Industry, Hock Chuan Heng Farm and its sole-proprietor, Hy-fresh Industries (S), Kee Song Brothers Poultry Industries, Lee Say Poultry Industrial and its sole-proprietor, Lee Say Group, Hup Heng Poultry Industries, KSB Distribution, Prestige Fortune (S), Ng Ai Muslim Poultry Industries, Sinmah Poultry Processing (S), Toh Thye San Farm, Tong Huat Poultry Processing Factory and Ban Hong Poultry.

The CCS said that by agreeing not to compete for each other's customers and fixing price increases, the Parties reduced competition and restricted the choices available to customers and distorted the prices of fresh chicken products here.

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 CCS.

In Singapore, the fresh chicken industry is divided into 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 the infringement, up to a maximum of three years.