The Federal Competition and Consumer Protection Commission (FCCPC) has threatened to penalise businesses involved in price fixing and gouging, issuing a one-month moratorium for them to reduce prices.
Price fixing occurs when two or more companies collude to
set prices for their goods or services at a certain level, rather than allowing
market forces to determine prices.
While on the other hand price gouging refers to the practice
of charging excessively high prices for goods or services, often in response to
a shortage or emergency situation.
Speaking at a stakeholder meeting on explorative pricing on
Thursday, Tunji Bello, executive vice-chairman and chief executive officer
(CEO) of FCCPC, said both practices harm consumers and are considered unfair
business practices.
He warned business owners and companies to desist from
exploitation.
“We have observed, for instance, that the margin in the
prices of imported goods is very disproportionate in many cases and, in the
case of locally produced goods, excessively inflated,” Bello said.
“This is an untenable situation, particularly in the retail
segment, where we have identified patterns of price fixing perpetrated by some
market associations, price gouging, and other anti-consumer practices.
“From our findings,
the penchant to hike prices arbitrarily is also common among sellers of food
items and transport operators.
“When the foodstuff sellers were engaged, their common
response was that the cost of transportation had increased. But how justifiable
is it for the tomato seller to double the price of a basket of tomatoes simply
because they paid a higher transport fare?
“Whereas the price of the same basket of tomatoes was far
cheaper at another market within the same jurisdiction surveyed by our field
officers. Now, the question: did the seller who sold at a lower price not also
pay the transport fare?”
Bello said the law empowers the commission to impose
penalties.
“In view of the
current situation in Nigeria, let me, however, be very unequivocal. Price
gouging and price fixing are not only unethical, but patently illegal under the
FCCPA,” he said.
“Section 17 of the Act empowers the Commission to eliminate
anti-competitive practices, misleading, unfair, deceptive, or unconscionable
marketing, trading, and business practices.
“As such, the FCCPC has the will and the capacity to invoke
the full weight of the law against those found culpable of exploiting consumers
for undue profit.
“Under Section 155, violators, whether individuals or
corporate entities, face severe penalties, including substantial fines and
imprisonment if found guilty by the court. This is intended to deter all
parties involved in such illicit activities.”
‘ENFORCEMENT TO BEGIN IN SEPTEMBER’
The FCCPC CEO, therefore, called on all stakeholders across
the ecosystem to embrace the spirit of patriotism and cooperation.
He also said the law empowers the commission to impose heavy
fines for breaches and also prosecute offenders which could lead to jail terms.
“In the spirit of democracy, we are first exploring the
option of dialogue. It is also in this spirit that we are giving a moratorium
of one month (that is, September) before the commission will start firm
enforcement,” he said.
“Let us work together
to create a marketplace that is not only competitive but also fair and just.”
Bello said the commission is committed to sustaining
dialogue with stakeholders, monitoring compliance, and taking decisive action
where necessary.
He assured all stakeholders that the FCCPC would ensure
every complaint is addressed accordingly.
Some of the complaints raised by trade unions at the event
include electricity tariff hike, petrol subsidy removal, taxes, corruption,
insecurity, among others.
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