The National Consumer Commission (NCC) sends a strong message to suppliers not to inflate prices of essential items listed under Consumer and Customer Protection and National Disaster Management Regulations and Directions, issued in terms of Regulation 350 of Government Notice 43116 (Regulation 350). This comes after reports of possible food shortages in both KwaZulu Natal and Gauteng provinces following public unrests. Regulation 350 read with sections 40 and 48 was gazetted by Government to prevent suppliers from profiteering during the period of the National Disaster. This was done to protect consumers against unfair, unreasonable or unjust pricing.
In terms of Regulation 350, Government intends to promote a concerted conduct to prevent an escalation of the national disaster and to alleviate, contain and minimise the effects of the national disaster and to protect consumers and customers from unconscionable, unfair, unreasonable, unjust or improper commercial practices during the national disaster. With this said, it is unreasonable and unfair for suppliers of goods to take advantage of this state of national disaster by unfairly increasing the prices of goods without any economic justification to do so.
Acting Consumer Commissioner Ms Thezi Mabuza says both Sections 40 and 48 of the Consumer Protection Act (CPA), make it a prohibited conduct for a supplier to increase their prices unconscionably. “Section 48 states that a supplier must not offer to supply, supply or enter into an agreement to supply goods and services at a price that is unfair or unconscionable. Unfair, unreasonable or unjust pricing (price gouging) is when a supplier increases prices of goods or services that do not correspond to or not equivalent to the increase of providing that service or good”, she said.
The goods and services in question are those which relate to basic food and consumer items, emergency products and services, medical and hygiene supplies as well as emergency clean-up products and services. A supplier or person contravening these Regulations could be fined up to One million rands, a fine of up to 10% of a firm’s annual turnover, or imprisonment for a period not exceeding 12 months. Consumers are encouraged to monitor the market and report any suspicious unfair price increases of these goods and services.
“The NCC will continue with its efforts of implementing the provisions of the CPA by reducing and ameliorating any disadvantages experienced in accessing any supply of goods or services by consumer”, she concluded.
