CFTC warns against anti-competitive trade practices regarding Illovo sugar

* The include hoarding of sugar at distributor level; exorbitant pricing of the product beyond the recommended retail price

* Tying the purchase of sugar to the purchase of other products and charging higher prices for sugar while issuing lower valued receipts

By Duncan Mlanjira

Competition and Fair Trading Commission (CFTC) says it has noted with concern reports regarding the proliferation of anticompetitive and unfair business practices emanating from the alleged shortage of sugar on the market.

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Over the past few days, people posted several pictures depicting different prices of sugar manufactured by Illovo Sugar Malawi Plc, but the company maintains that the recommended price is K2,000 per 1kg packet.

Other shops are restricting customers from buy more than they require while others are forcing consumers to purchase other items on top of the sugar.

In response to these reports, CFTC said it conducted snap inspections in selected markets to ascertain these allegations and found that some suppliers are engaging in the following malpractices among others:

* Hoarding of sugar at distributor level;

* Exorbitant pricing of the product beyond the recommended retail price;

* Tying the purchase of sugar to the purchase of other products; and

* Charging higher prices for sugar while issuing lower valued receipts.

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“Suppliers, consumers and the general public are, hereby, reminded that the business malpractices involving hoarding, excessive pricing, tying, misleading consumers as to price of a product with the view to take advantage of a situation, are violations of the Competition and Fair Trading Act (CFTA).

“All suppliers found engaging in such malpractices will be dealt with in accordance with the CFTA, said the CFTC in a statement issued today, January 29.

The Commission is also encouraging the general public to be very proactive in reporting any possible violations including the above mentioned malpractices through Toll Free Line 2489 and/or WhatsApp +265 987 738 749.

Since November last year — after the devaluation of the Kwacha by the Reserve Bank of Malawi — the CFTC has been conducting weekly market surveillances to check on whether traders are engaging in unfair trading practices, specifically excessive pricing.

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Public relations officer, Innocent Helema said by the end November 2023, they engaged about 20 companies whom they suspected to have excessively raised prices.

“Some of them have responded to the letters that were written to them to explain such price increases,” he said a fortnight ago. “These companies were given the right to explain themselves in line with the standard investigation due process of the CFTC.

“The outcome of the investigations will be presented to our Board for determination. There will be sanctions on those found to have violated the law after the conclusion of the investigations and pronunciation of the decisions by the Board of Commissioners.

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