Thursday, July 18, 2024

Big companies face corporate bullying, cartel investigations

Barlow World, Botswana Post, Cresta, FSG funeral services, Komatsu, Jacks Gym and Molapo Crossing are among a number of Botswana’s leading corporate brands that are being investigated for corporate bullying, price fixing and cartel practices.

The Competition and Consumer Authority (CCA)’s latest annual report has revealed a number of cartel and price fixing cases under different economic sectors that are under investigation.

Among them is the abuse of dominance in the Life Insurance sector and bid-rigging in government supply chain.

There is an allegation of abuse of dominance and market allocation by Cresta Mahalapye. The Authority says an anonymous complainant reported the matter to the Authority citing possible refusal to deal, market allocation, and excessive pricing behaviour by Cresta Mahalapye.

It is alleged that Cresta Mahalapye deliberately overbooks its accommodation (more especially to clients paying by purchase order) and when the client arrives to check in, some are often informed that there is no accommodation. Such clients are then given alternative accommodation options using Cresta Mahalapye’s preferred lodges in the Mahalapye area.

It is alleged that Cresta Mahalapye overbooks its facility with the intention to reallocate the overspill to its preferred lodges. As per the allegation, because the customer would probably be desperate (because of a late-night check in), they would just accept the alternate accommodation offer from Cresta Mahalapye.

In so doing, Cresta Mahalapye would have charged the client its going accommodation rate (which is alleged to be higher than local lodges) but would only remit to the lodge receiving the overspill, the room rate charged by that lodge. Cresta Mahalapye would then pocket the difference between what it charged the client and what it paid out to the lodge receiving the overspill. Therefore, the client would have been overcharged as it would have prepared a purchase order at the rate charged by Cresta Mahalapye. The investigation continues.

There is the PBL Africa (Pty) Ltd Vs Superfit Molapo against Sphinx Associates – a case of alleged abuse of dominance

against Sphinx Associates (Molapo Crossing Mall). The allegation is that there is possible abuse of dominance by Molapo Crossing Mall by refusing to deal with PBL Africa (Pty) Ltd which operates Superfit Molapo Gym, but opting to only deal with Jack’s Gym (the new tenant to operate a gym business at Molapo Crossing Mall). It is further alleged that, since Jack’s Gym is the preferred tenant to operate a gym business at Molapo Crossing Mall, both Molapo Crossing Mall and Jack’s Gym could be jointly abusing their market power to orchestrate market exit of Superfit Molapo from operating at Molapo Crossing Mall. The preliminary investigation continues. Easi-Mail Vs Botswana Post.

The Authority received a complaint against Botswana Post alleging possible abuse of dominance in trading with Franking machines. The investigation is still continuing.

Yet again there is the Doves Funeral Parlour Vs FSG Limited Botswana. This is a case of alleged abuse of market dominance and discriminatory conduct by FSG Limited Botswana funeral parlour.

The allegation is that FSG Limited Botswana, which owns Phomolong Private Cemetry, refuses to give Doves Funeral Parlour access to carry out funeral proceedings for clients that had bought funeral space at Phomolong Cemetery. It is also alleged that FSG Limited Botswana discriminates against Doves Funeral Parlour on the pricing of the cremation service offered at the FSG cremation facility in Mahalapye. The preliminary investigation continues.

An undertaker, known to this publication, who was supposed to have conducted a funeral over this past weekend but could not do so because FSG would not allow them to access to Phomolong is fuming.

“It’s the same old story. FSG fears competition. They still hold clients who hold with policies with them at ransom. They demand a ridiculous P5000 if they choose to opt for a better and financially reasonable service elsewhere,” said an irate undertaker on Friday.

FSG has previously denied unfair competition.


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