Onion Price Hiked via Syndicate in the Philippines; 3.43 Billion Taka Fine Imposed

Six companies have been fined 3.43 billion taka (176 million pesos) for forming a syndicate to drive up onion prices. Philippine authorities announced this stern measure last Wednesday (October 14).

According to the relevant authorities, the six companies were fined 176 million pesos (approximately 27.9 million US dollars or 3.43 billion taka). These companies had formed a "syndicate," which caused onion prices to skyrocket.

In 2022, the price of onions in the Philippines reached a record high of 800 pesos per kilogram—a figure that surpassed both the country's daily minimum wage and the price of meat.

This crisis placed significant pressure on the then-newly elected President Ferdinand Marcos Jr., who had promised to bring down the soaring prices of food items.

The Philippine Competition Commission (PCC) stated on Wednesday that this penalty—imposed on firms involved in the importation, storage, and transport of onions—is the largest fine levied since the commission’s establishment in 2016.

From late 2022 through early 2023, onions vanished from restaurant menus and even became an object of smuggling.

At one point, onions even became a status symbol; at one wedding, a bride was seen carrying a bouquet of onions instead of flowers.

Authorities authorized emergency onion imports, and President Marcos vowed to take strict action against those behind the crisis, stating, "Because of their actions, the Filipino people are suffering from hunger and poverty."

The crisis eventually subsided and prices stabilized later in 2023, as a bumper local harvest reached the market. A parliamentary committee tasked with investigating the price crisis stated that a syndicate was behind this ‘artificial’ surge in onion prices.

The PCC (Philippine Competition Commission) reported that evidence gathered during raids on these companies revealed that, in 2020 and 2021, six firms controlled approximately 50 percent of the total authorized volume of onion imports.

According to the Commission, these companies had established an ‘illegal market-sharing arrangement’ covering the importation, cold-storage, and wholesale distribution of onions.

The PCC further noted that these substantial fines reflect a commitment to holding syndicates across all economic sectors accountable and protecting consumers from the harmful effects of anti-competitive practices.

The Commission added that the judiciary could also initiate criminal proceedings against the entities found guilty.

Source: BBC