Retailers and suppliers to face prosecution over price hikes

Written by on 16th Apr 2020

The Competition Commission has referred its first case to the Competition Tribunal for prosecution, in the wake of Covid-19.

In a statement, the commission said the first case is for excessive pricing of facial mask by Babelegi Workwear Overall Manufacturers and Industrial supplies CC.

“The Commission investigated the complaints and found that during the period 31 January 2020 to 5 March 2020, Babelegi increased its prices of facial masks from R41 per box up to the highest price of R500 per box, earning during this period mark-ups in excess of 500%.”

Facial masks fall under the category of ‘medical and hygiene supplies’ and have been identified as essential goods for the prevention and escalation of the COVID-19 pandemic. Commissioner Tembinkosi Bonakele said there will be a wave of prosecutions of firms in the coming days.

 

Other matters that have been concluded, but are yet to be referred to the Tribunal include:

• An investigation of a hardware that allegedly increased the price of surgical gloves over a
period of a week from R99.99 to R170, with no cost increase justifications.
• A pharmacy that earned more than 300% mark-up on face masks and hand sanitiser.
• A wholesaler of chicken that increased mark ups for chicken pieces by up to 50%, with no
cost increase justifications.
• A supplier of face masks that earned over 665% mark-ups.

“The commission has now gone past the stage of moral suasion and appeals to patriotism to stop abuse of market power by those seeking to exploit consumers at the worst possible time, the law must take its course,” said Bonakele.


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