CCP Approves CDC’s Investment in NCMCL Under Competition Act Review

Approves CDC’s Investment in NCMCL

The (CCP) has approved the proposed investment by the Central Depository Company of Pakistan Limited (CDC) in Naymat Collateral Management Company Limited (NCMCL), following a Phase-I review under the Competition Act, 2010.

CDC submitted a pre-merger application to the CCP under Section 11 of the Act, seeking approval for the subscription of additional ordinary shares in NCMCL. The Commission authorized the transaction, allowing CDC to acquire additional shareholding in the company.

Established in 1993, CDC is one of Pakistan’s key capital market institutions, providing electronic custody of securities, settlement facilitation and related depository services. NCMCL, incorporated in 2020, operates as a collateral management company responsible for warehouse oversight, verification and reporting services for commodities held as collateral.

Currently the only collateral management company registered with the Securities and Exchange Commission of Pakistan for accreditation and oversight of warehouses operating under the country’s Electronic Warehouse Receipt framework, NCMCL was defined by the CCP as the relevant market in its assessment. The Commission concluded that the deal would not significantly alter competition dynamics because CDC and NCMCL operate in separate and unrelated business segments.

The CCP noted that the acquisition neither constituted horizontal nor vertical integration, reducing the likelihood of anti-competitive effects such as market foreclosure or collusion. It further concluded that the transaction would not create entry barriers or substantially lessen competition in the market.

The decision reflects the CCP’s commitment to facilitating investment and efficient market transactions through timely merger reviews while ensuring that market competition and consumer welfare remain protected.