ARC Manufacturing Limited (ARC) has officially taken their complaints against competitor Tank-Weld Metal (Tank-Weld) to the Fair Trading Commission (FTC). The allegations suggest that Tank-Weld is practicing “predatory pricing” tactics in the steel market, which ARC claims is a form of “abuse of dominance”. ARC has urged the competitions watchdog to launch an investigation into the matter and make a ruling.
According to the complaint filed by ARC, Tank-Weld has been selling rebar, a type of steel used in block and steel construction in Jamaica, at a price significantly below its actual cost price in the country. ARC, as an importer of rebar, revealed that the average supply cost for the steel, including insurance and freight (CIF), is around US$610 per metric ton. However, Tank-Weld has been selling the same steel for US$650 per metric ton in Jamaica, while selling it for US$750 per metric ton in other islands. ARC accuses Tank-Weld of employing a dual pricing strategy to eliminate local competitors and monopolize the market, ultimately harming consumers.
Tank-Weld currently holds about 75 per cent of the steel market, leaving ARC with the remaining 25 per cent. Norman Horne, the executive chairman of ARC Manufacturing, emphasized that they are not against a dominant player in the industry but are fighting against the abuse of dominance and seeking fair and competitive trade practices.
The complaint also highlights Tank-Weld’s control of a sufferance wharf in Rio Bueno, Trelawny, which provides the company with certain advantages that other players cannot access. ARC is calling for an investigation into Tank-Weld’s pricing strategies and operations at the wharf to ensure fair competition in the market.
ARC has been losing market share due to Tank-Weld’s pricing tactics and fears an eventual exit from the market if remedial measures are not taken. They are prepared to take legal action against Tank-Weld if the FTC finds them guilty of abuse of dominance, even willing to go to the Privy Council in London for a fair ruling.
Tank-Weld has denied the allegations and defended its business model that has driven its success over the years. Chris Bicknell, CEO of Tank-Weld Metals, stated that past complaints against the company did not result in any adverse findings, and they will continue to operate in accordance with the law.
The outcome of the FTC’s investigation will determine the future of the steel market in Jamaica and could have significant implications for the construction industry and the government’s development plans across the island. ARC is adamant about restoring fair competition and preventing market manipulation by any dominant player in the industry.
