Home South African Tribunal slaps Dis-Chem with R1.2m fine for inflating face mask prices

Tribunal slaps Dis-Chem with R1.2m fine for inflating face mask prices

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The Competition Tribunal concluded that Dis-Chem Pharmacy had engaged in excessive pricing to the detriment of consumers

File picture: Reuters

THE COMPETITION Tribunal has slapped Dis-Chem Pharmacies with an R1.2 million administrative penalty for charging excessive prices for surgical face masks during the Covid-19 pandemic.  

The Tribunal said that Dis-Chem contravened section 8(1)(a) of the Competition Act (the Act) in that it charged an excessive price for three types of surgical face masks – SFM 50, SFM 5 and Folio50 – to the detriment of consumers during March.

The Competition Commission accused Dis-Chem of abusing its dominance and charging excessive prices for surgical masks to the detriment of customers and consumers. Dis-Chem denied the commission’s claims.

The commission charged that Dis-Chem had hiked the price of  surgical face masks by up to 261 percent

The tribunal on Tuesday concluded that the commission had shown that Dis-Chem had engaged in excessive pricing to the detriment of consumers.

The tribunal said material price increases of between 47 percent to 261 percent without corresponding increases in costs of any goods in a country such as South Africa with a long history of economic exclusion and deep inequality would seriously affect the public interest adversely. 

“Material price increases of surgical masks, without corresponding costs justifications, in the context of Covid-19 for which there is no discernible cure and where health services are skewed towards the wealthy, would seriously impact vulnerable and poorer consumers even more. Poorer customers would have been excluded from accessing the masks by such exorbitant increases; other customers would have spent more on these items as a percentage of their disposable income,” said the tribunal.

– Business Report