Cape Town-based chemicals company Caprichem has agreed to pay a settlement amount of R600 000 for allegedly charging excessive prices for hand sanitisers.
The settlement amount comprises a R500 000 administrative penalty paid to the Competition Commission and a R100 000 contribution to the Solidarity Fund.
Caprichem also agreed to reduce its gross profit margin on 5 ℓ hand sanitisers for the duration of the state of the national disaster.
The settlement follows the commission’s complaint referral to the Competition Tribunal against Caprichem for alleged excessive pricing of 5 ℓ hand sanitiser to the detriment of customers and consumers.
The commission said the company had excessively increased its gross profit margin by as much as 91% and its net profit margins by as much as 1 981% on such products.
To date, the commission has referred and settled 25 Covid-19-related cases, with a total value of R14-million. Of this amount, about R5.5-million has been donated to the Solidarity Fund.
The commission has encouraged firms to reach settlements in order to speed up the processing of excessive pricing cases.
In most settlements, firms had undertaken to correct prices/margins and make a donation to a public interest organisation or the Solidarity Fund.