PCC slaps onion cartel with record fine of P1.76B

ONIONS. A market vendor arranges large onions imported from China which sell for P350/kilo at Libertad Market in Pasay City on January 17, 2023.

Rappler

Among those fined is 'onion queen' Lilia Cruz, the alleged cartel mastermind. It's the biggest fine ever imposed by the Philippine Competition Commission.

AT A GLANCE

• The Philippine Competition Commission (PCC) imposed a P1.76-billion fine on members of an onion cartel involved in illegal market allocation and manipulation of onion prices.
• The cartel's activities included collusion in importation and distribution, controlling nearly 50% of onion import clearances in 2020 and 2021, leading to a significant price surge in late 2022.
• Key individuals and firms were identified and fined, while the PCC emphasized its commitment to combating anti-competitive practices and protecting consumers.

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MANILA, Philippines – Almost four years since the country’s onion crisis, the Philippine Competition Commission (PCC) imposed a combined P1.76-billion fine against onion cartel members that colluded in an “illegal market allocation scheme in the importation, cold storage, and wholesale distribution of red and yellow onions.”

In late 2022, onion prices in the Philippines skyrocketed to over P800 per kilo, prompting a House probe into alleged price manipulation and cartel operations.

“Because the importers’ submitted audited financial statements were found to be grossly understated, the Commission computed the fines using actual import clearance volumes, and wholesale prices reported by the Philippine Statistics Authority,” the PCC said on Thursday, October 15.

This comes two years after the PCC sued onion firms in 2024, as well as a dawn raid of warehouses in September 2023, including the respondents’ offices located in Golden Shine Corporate Center.

“An examination of the evidence [from the raid] revealed that Golden Shine systematically applied for sanitary and phytosanitary import clearances using the other respondent-importers’ credentials, assigned the same importers as consignees, monitored permit allocations, and coordinated shipments. By accumulating permits across separate corporate entities, the respondents collectively controlled nearly 50 percent of all approved import clearances for red and yellow (or white) onions in 2020 and 2021, routing imported shipments to cold storage facilities managed under Tian Long [Corp.] from where imported onions were distributed nationwide,” the PCC explained.

Six firms named engaged in the onion cartel and subsequently fined are:

• Golden Shine International Freight Forwarders Corp.
• Tian Long Corp.
• La Reina Fresh Vegetables & Young Indoor Plants, Inc.
• Yom Trading Corp.
• Vegefru Producing Store
• Rosal Fruit and Vegetable Trading

In 2024, the Department of Agriculture blacklisted importers linked to the cartel: La Reina Fresh Vegetables Young Indoor Plants Incorporate, Vegefru Producing Store, and Yom Trading Corporation.

The individual officers held liable are:

• Lilia Cruz, president of Golden Shine
• Eric Pabilona, corporate executive officer of Golden Shine and corporate secretary of Tian Long
• Renato Francisco Jr., chairman and president of La Reina and Yom Trading
• Letty Baculando, incorporator of Golden Shine

According to the PCC, charges against other companies allegedly involved — Philippine Vieva Group of Companies, Inc. and the Vegetable Importers, Exporters & Vendors Association of the Philippines Inc. — were dismissed due to “insufficient evidence.”

But key officers of these companies are also the same individual officers fined, as mentioned above such as Cruz and Pabilona. Cruz had been referred to as the “onion queen” or “Mrs. Sibuyas” for being implicated as the cartel mastermind.

“By imposing the maximum fines, the PCC underscores its commitment to holding cartels accountable across all sectors of the economy and protecting consumers from the harmful effects of anti-competitive conduct,” PCC Executive Director Kenneth Tanate said.  

The government initially sought a P2.423-billion fine against the cartel back in 2024.

Aside from the fines, those involved in cartel activities may also face criminal liability if the Department of Justice-Office for Competition finds basis in filing cases.

The PCC is the quasi-judicial body that implements Republic Act No. 10667 or the Philippine Competition Act, which seeks to promote and protect market competition in the country. – Rappler.com