· The Competition Tribunal of South Africa has found Babelegi Workwear and Industrial Supplies CC guilty of violating section 8 of the Competition Act.
· The company alleged to have increased its prices for facial masks from R41 per box to a whopping R500 per box, earning profits in excess of 500%, which is in contravention of the Competition Act in the supply of protective facial masks.
The Competition Tribunal of South Africa has found Babelegi Workwear and Industrial Supplies CC guilty of violating section 8 of the Competition Act. The company alleged to have increased its prices for facial masks from R41 per box to a whopping R500 per box, earning profits in excess of 500%, which is in contravention of the Competition Act in the supply of protective facial masks.
The case referred to the Tribunal by the Competition Commission comes under the purview of noncompetitive business practices. The Tribunal also noted that Babelegi’s prices for facial masks increased by at least 888% compared to the prices charged in December of 2019 vis a vis prices levied in March of 2020. The Tribunal imposed a fine of R76 040 on the company. The Tribunal set aside the argument of the company purported to be a rational and valid explanation for its successive and massive price increases that are not substantiated by any corresponding increase in cost. According to the Tribunal Babelegi exploited the crisis situation and increased both its prices and mark-ups for masks. The Tribunal said that the Commission established a prima facie case of an abuse of dominance.
Importantly, the Competition Commission is investigating allegations that retailers, traders, suppliers and pharmacies are charging excessive prices for Covid-19 related products including masks and sanitizers, protective gear, and certain essential goods and basic food items.
