File picture: Timothy Bernard/ African News Agency (ANA)
File picture: Timothy Bernard/ African News Agency (ANA)

Gauteng supplier guilty of 500% mark-up on facial masks over two months

By ANA Reporter Time of article published Jun 1, 2020

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Johannesburg – Gauteng-based Babelegi Workwear and Industrial Supplies CC has been found guilty of excessive and exploitative pricing of face masks, the Competition Commission said on Monday.

The commission said the company was found guilty under the Competition Act, concerning consumer protection regulations.

"On April 15, the Commission referred Babelegi to the Tribunal on charges of inflating prices of facial masks following the advent of the Covid-19 national disaster. 

"This was the first case referred for prosecution following a complaint laid on 24 March, 2020 and the matter was heard a month later on 24 April, 2020," said acting spokesperson Siyabulela Makunga.

He said the commission had received about 1,500 complaints from consumers about the prices of certain essential goods and basic food items sky-rocketing since the declaration of the national health disaster in mid-March.

"The commission investigated the complaint expeditiously and found that during the period 31 January, 2020 to 5 March, 2020, Babelegi had increased its prices of facial masks from R41 per box up to the highest price of R500 per box, earning during this period mark-ups in excess of 500 percent. 

"The commission further found that Babelegi’s prices for facial masks increased by at least 888 percent when comparing the prices charged on 9 December, 2019 to the prices charged on 5 March, 2020."

Makunga said the tribunal found that Babelegi effected several price increases before the actual increase in its supplier costs on March 18.

The first significant increase occurred on January 31, a day after the World Health Organisation declared Covid-19 a public health emergency of international concern. 

"The tribunal further found that Babelegi’s price increases became progressively bolder wherein, on 10 February 2020, Babelegi again significantly increased its price and subsequently on 5 March 2020 when South Africa announced its first Covid-19 case."

The tribunal found Babelegi’s increases and mark-ups were "unreasonable" and of "an exploitative nature", and fined it R76 000. 

African News Agency (ANA)

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