Thursday, May 28, 2020

Competition and Consumer Protection Authority warns coronavirus price-gougers

Those who have come to see coronavirus more as a business opportunity than a deadly public health emergency are risking the wrath of the Consumer Protection Act. In a press statement that it released on Thursday morning, the Authority announces that it has noted several complaints from the public regarding increase in prices for essential products. Such complaints relates to some basic food products, healthcare and hygiene products as well as “dubious products being sold in the market.”These actions contravene at least three provisions in the Consumer Protection Act: Section 5, Section 15(4) and Section 15(5).

Section 5 outlaws false marketing, Section 15(4) outlaws trading in goods that do not conform to the mandatory safety standards set by the Botswana Bureau of Standards (BoBS) or international bodies it recognises. Section 15(5) empowers the Authority to re-call unsafe goods which do not conform to mandatory safety standards, to halt trade of such goods, to notify the public about unsafe goods as well as to “direct the supplier to replace the goods, refund any consumer who bought the unsafe goods or compensate the consumer for any damage suffered by the consumer in using the unsafe goods at an amount determined by the Authority.”

What the latter means in practical terms is that all the people who are now passing off watered-down ordinary detergents as alcohol-based sanitisers to the unwitting, might in future, be directed to refund all the people they hoodwinked as well as compensate them for the medical harm they suffered as a result of using those products. Detergents like Jik and Windolene, which can cause chemical burn, have been mentioned among products that are being passed off as genuine alcohol-based sanitisers. The wording of Section 15(5) makes clear the fact that Jik suppliers can be legally required to compensate someone who suffered chemical burn as a result of using it.“The Competition and Consumer Authority will take appropriate action against any business or person found to be engaged in deceptive practices or any other trade malpractices in the supply of products intended to fight the Corona Virus,” the Authority says in its statement.For now, at least, the Authority itself faces an unusual problem with regard to taking such action because it closed down on Thursday in compliance with President Mokgweetsi Masisi’s stay-at-home order.

In quoting a Setswana saying about the eternal shelf life of unprosecuted crime (“molato ga o bole”), the Authority’s spokesperson, Gideon Nkala, says that offenders can still be dealt with after the lockdown. His advice to the victim-consumers is to keep the receipts and other evidence that would enable the Authority to take action “once the situation has stabilised.”Nkala adds that although that the situation is still fluid and that any escalation in the adverse situation the Authority’s statement describes might force the authorities to recall staff to respond to the situation. South Africa is facing a similar problem. According to The Citizen, the country’s own Competition Commission has received an unprecedented 559 complaints of excessive pricing related to Covid-19 essentials such as hand sanitisers, face masks, toilet paper and flu medication. The situation has forced the Minister of Trade, Industry and Competition Ebrahim Patel, to gazette regulations in terms of the Competition Act and Disaster Management Act to respond to incidences of exploitative pricing. 

“These regulations empower the Commission to prosecute cases where prices have increased materially without any cost justifications for the increase,” says a statement on the website of the South African Competition Commission. “The Commission is working closely and coordinating with the National Consumer Commission to provide consumers the swiftest and most effective protection against price abuse during this period.”

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Sunday Standard May 24 – 30

Digital copy of Sunday Standard issue of May 24 - 30, 2020.