Tribunal approves four more consent agreements

15th May 2020 By: Donna Slater - Creamer Media Staff Writer and Photographer

The Competition Tribunal has confirmed four more consent agreements relating to Covid-19 excessive pricing complaints, that were concluded between the Competition Commission and various companies.

Consent agreements offer parties to alleged anti-competitive conduct the opportunity to settle the matter with the commission by agreement. A consent agreement must be confirmed as an order of the tribunal for it to be legally enforceable.
 
The four consent agreements relate to alleged excessive pricing of goods seen as essential in the context of the Covid-19 pandemic, such as hand sanitisers and face masks, and are a contravention of the Competition Act, read with the Consumer Protection Regulations.

This brings the total number of agreements, approved in recent weeks as orders of the tribunal, to 11.

The commission had concluded the consent agreements with the companies after receiving and investigating complaints from the public.

In terms of the latest consent agreements, Bloemfontein-based supplier selling face masks to customers, Domoney Brothers Bloemfontein, was accused by the commission of having marked up the price of its dust masks by 56% in February and 262% in March.

In its agreement with the CCSA, Domoney has undertaken to contribute R30 040 to the Solidarity Fund. It will also donate face shields worth R30 040 to the Carel du Toit School for the Deaf, the Universitas Hospital and the Pelonomi Academic Hospital in Bloemfontein.

The company has also agreed to immediately desist from excessive pricing conduct and to reduce its mark-up on dust masks to an agreed maximum for the duration of the state of national disaster.

A second case involving Sanua, trading as Naturally Yours Weleda Pharmacies, found that the average cost mark-up of about 50% and gross profit margin of 33.33% in respect of 500 ml hand sanitisers for March was high and possibly a contravention of the Competition Act.

Besides other measures, Weleda Pharmacies has undertaken to donate R18 750 to the Solidarity Fund and to reduce its gross profit margin on the sale of hand sanitisers to an agreed maximum for the duration of the state of national disaster.
 
A third case involving Retrospective Trading, trading as Merlot Pharmacy, also saw the company marking up the price of its hand sanitisers and facial masks in March and April.

In its consent agreement, Merlot Pharmacy has undertaken to, besides others, donate an amount of R16 832 to the Solidarity Fund, and reduce its gross profit margin on facial masks and hand sanitisers to an agreed maximum with immediate effect for the duration of the state of national disaster.

A fourth case involved Retrospective Trading, trading as Seaside Pharmacy, which the commission said had marked up the average cost of hand sanitiser by 63.04% and gross profit margin by 38.67%, and the average cost of face masks by 44.95% and gross profit margin by 31%, in March and April.

Seaside Pharmacy has agreed to donate R4 168 to the Solidarity Fund, to immediately reduce its gross profit margin on face masks and hand sanitisers to an agreed maximum for the duration of the state of national disaster and to immediately desist from excessive pricing conduct as described in the consent agreement.