MDPPACPB Regulations

Page 43 of 127
43 
 
(a) Limiting Production or Technical Development: The deliberate operation of 
refineries, pipelines, storage depots, or other petroleum infrastructure below 
efficient capacity, or the undue delay or avoidance of upgrades, expansions, 
or technological innovations, with the intent or effect of: 
 
(i) Reducing market supply to raise prices; 
 
(ii) Constraining access for competitors; 
 
(iii) Preserving artificial scarcity or inefficiency. 
Example: Refusing to debottleneck a pipeline segment where the added 
capacity would allow a competing transporter to serve underserved markets. 
(b) Excessive Pricing: Charging prices or fees that are grossly disproportionate 
to the economic value of the product or service provided, particularly where: 
 
(i) The firm enjoys local monopoly or captive market conditions; 
 
(ii) There is evidence of persistent supra-competitive profits without 
investment justification; 
 
(iii) The price lacks relation to cost or reasonable margin expectations. 
Example: A lone petroleum depot operator in a remote region imposes 
extreme throughput charges far above benchmark rates for similar services 
elsewhere, absent infrastructure constraints. 
(c) Unjustified Refusal to Supply: Denying the supply of petroleum products, 
infrastructure services, or other essential inputs to a willing and qualified buyer, 
without objective and proportionate justification, especially where the buyer 
lacks viable alternative sources. 
Example: A dominant refinery refuses to sell low-sulfur diesel to a downstream 
distributor who has satisfied all contractual terms, in order to favour an affiliate 
or exclude a competitor. 
(d) Obstructing Innovation or Market Entry: Engaging in conduct that hinders 
technological development, innovation, or the entry of new market 
participants, including: 
 
(i) Coercing or incentivizing third parties (e.g. suppliers, banks, trade 
partners) to withhold support from new entrants or disrupt alternative business 
models; 
 
(ii) Denigrating new technologies to preserve market dominance. 
Example: A dominant PMS marketer uses its market leverage to discourage 
pump manufacturers or financial institutions from supporting a biofuels retail 
start-up. 
(e) Any Conduct Prohibited Under Parts II-X of these Regulations, when carried 
out by a dominant firm, shall be considered especially suspect. Practices such 
as exclusive dealing, tying and bundling, information misuse, or coordinated 
refusals to deal may constitute abuse when implemented by a dominant 
operator even if such practices might be benign when employed by smaller 
market players. 
(3) Obligation to Seek Clarification:  
Dominant firms are advised to seek legal counsel or a formal advisory opinion 
from the Authority prior to engaging in any conduct that may raise 
competition concerns. The Authority may issue non-binding guidance or 
formal clearance based on full disclosure of the proposed conduct and its 
likely market effects.