COVID-19 EXCESSIVE PRICING – SOUTH AFRICAN COMPETITION TRIBUNAL CONFIRMS A FURTHER THREE CONSENT AGREEMENTS
On 26 May 2020, the South African Competition Tribunal (Tribunal) reported that it had confirmed a further three consent agreements relating to COVID-19 excessive pricing as orders. The consent agreements represent settlements reached between the South African Competition Commission (Commission) and firms alleged to have engaged in COVID-19 excessive pricing.
This brings the total number of consent agreements confirmed by the Tribunal in recent weeks to 15 (see our earlier newsflashes accessible here and here). The Tribunal’s orders represent full and final settlement of these matters.
- Sunset Pharmacy CC
Following an investigation, the Commission found that Sunset Pharmacy’s average cost mark-up and gross profit margin in respect of face masks it sold from March 2020 were high and probably constituted a contravention of the Consumer and Customer Protection and National Disaster Management Regulations and Directions (Regulations). Sunset Pharmacy concluded a consent agreement with the Commission, in terms of which the pharmacy undertook, inter alia, to donate ZAR 8 640 to the COVID-19 Solidarity Fund and to reduce its profit margin on face masks for the duration of the national disaster.
- Cedar Pharmaceuticals CC t/a Bel-Kem Pharmacy
After receiving complaints from the public, the Commission investigated Bel-Kem Pharmacy for allegedly selling hand sanitisers at excessive prices. The Commission found that the pharmacy’s average cost mark-up and gross profit margin for these items were high, and probably constituted a contravention of the Regulations. Bel-Kem Pharmacy concluded a consent agreement with the Commission, in terms of which the pharmacy undertook, inter alia, to donate ZAR 1 059.10 to the COVID-19 Solidarity Fund and to reduce its gross profit margin on hand sanitisers for the duration of the national disaster.
- Manhattan Cosmetics CC
Following the Commission’s allegations that Manhattan Cosmetics’ cost mark-up and gross profit margin for the sale of hand sanitisers in March 2020 were high and may have contravened the Regulations, the Commission and Manhattan Cosmetics concluded a consent agreement in terms of which the latter undertook, inter alia, to donate hand sanitisers to the value of ZAR 612 to a public interest organisation. The amount donated is relative to the alleged overcharge to customers. Manhattan Cosmetics also agreed to reduce its gross profit margin for hand sanitisers for the duration of the national disaster.
For further information please contact one of the partners in our South African Competition Practice.