Cape restaurant supplier admits to excessive pricing of nitrile gloves during Covid-19 pandemic – agrees to donate to Solidarity Fund
Oil and More General Trading CC (O&M), a Cape Town food distributor and restaurant supplier, admits to excessive pricing of nitrile gloves during March and April 2020 in contravention of the Act and the Consumer Protection Regulations (the Regulations).
Nitrile gloves fall under the category of “medical and hygiene supplies” in the Regulations.
In its consent agreement with the Commission, confirmed as an order of the Tribunal, O&M agrees to donate R18 361.51 to the Solidarity Fund. In addition, O&M agrees to:
- Immediately stop the excessive pricing conduct as described in the consent agreement;
- Immediately reduce its gross profit margin on nitrile gloves to and agreed maximum percentage for the duration of the state of disaster;
- Implement and submit proof of a competition law compliance programme (incorporating corporate governance) to prevent future contraventions; and
- Circulate the summarised consent agreement to management and staff.
In April 2020, the Commission received a complaint against O&M for the alleged inflated pricing of nitrile blue disposable gloves (nitrile gloves) between March and April 2020.
The Commission investigated and concluded that O&M’s gross profit margin during March and April 2020, in respect of nitrile gloves sold, amounts to a contravention of section 8(1)(a) of the Act (i.e. excessive pricing) read together with regulation 4 of the Regulations.
The Commission found that the pandemic gave market power to O&M in the market for the supply of food products and consumables to the hospitality industry in the City of Cape Town.
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