Companies face fines or jail time for hiking prices during the lockdown
- Staff Writer: Staff Writer
Minister of Trade and Industry Ebrahim Patel says that 11 companies have been reported by South African citizens for trying to take advantage of the coronavirus crisis in the country by hiking prices on essential products.
These 11 companies are now under investigation by the competition and consumer commissions, and face prosecution – with potential fines of R1 million or up to 10% of their turnover, or up to one year in jail.
Patel also said that more companies have been identified, and action will be taken against them as well. Companies will be under closer scrutiny during the coming lockdown.
The consumer commission has set up a toll-free number where citizens can report business that are doing similar practices: 0800 014 880 – citizens can also contact the commission on its social media platforms.
The Competition Act prohibits various acts of excessive pricing and collusive behaviour by suppliers and retailers which artificially inflates prices and exploits consumers.
The penalties for such offences are severe, including a 10% of the firm’s annual turnover for a first time offence and 25% of annual turnover for a repeat offence.
For collusive behaviour, the directors of companies which engage in such acts face potential imprisonment for a period of up to 10 years.
The Comeptition Commission is watching a list of 22 specific items for abuse from unscrupulous business owners looking to take advantage of vulnerable consumers during the coronavirus outbreak.
This includes basic foods, personal care products and hygiene products, as well as medical supplies.
“During this period of the state of national disaster, the Commission will specifically prioritise such complaints to ensure that firms exploiting consumers are quickly prosecuted and penalised.
“To this end, the Commission has set up a dedicated team to respond and investigate any such complaints, and to fast track these through referral and prosecution before the Competition Tribunal,” it said.