The Federal Competition and Consumer Protection Commission, FCCPC, has given traders and market associations one month’s notice to reduce the prices of goods or face the music.
The Executive Vice-Chairman of the FCCPC, Mr. Tunji Bello issued the order, Thursday, in Abuja at a one-day stakeholders’ engagement on exploitative pricing.
Bello said: “The issue of the critical national importance of the day is the growing trend of unreasonable pricing of consumer goods and services across the country, and the unwholesome practice of market associations engaged in price fixing.
According to Bello, given the current situation in the country, he pointed out that this action by the traders of exploiting innocent consumers by arbitrarily fixing the prices of goods was not only “unethical”, but “illegal”, and warned that enforcement of the law would commence after the expiration of the one month notice.
He said: “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. 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.
‘’As a responsive organization, we have carried out discreet market surveys extensively across the country in the past few weeks. Our findings are quite disturbing, to put it mildly. Therefore, our gathering here today (Thursday) is to underscore the gravity of the situation and the urgency of the need to work together to check this unwholesome development.
“As a statutory body whose mandate is to cater to consumer rights, we cannot allow this unhealthy trend to continue. To be sure, we quite recognize that an unfavorable exchange rate has negatively impacted the cost of production in local currency.
‘’We have observed, for instance, that the margin in the prices of imported goods are very disproportionate in many cases; and in the case of locally produced goods, excessively inflated.
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”, he said.
He noted that price fixing which refers to an unholy agreement between competing businesses to set prices, implicitly or explicitly at a certain level, hampers healthy competition that is otherwise expected to drive prices down and improve quality.
He said: ‘’Price gouging on the other hand occurs when sellers significantly increase the price of goods or services during a crisis or a period of economic challenge. This practice takes undue advantage of consumers.
Bello condemned the action of the market associations and traders aimed at arbitrarily hiking prices, adding that no business principle can justify such a level of profiteering.
Bello who gave varying instances of investigative findings by the government’s undercover men said, the FCCPC will no longer tolerate such unwholesome action by the traders and would henceforth crack down on defaulters.
“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? The price of the same basket of tomatoes was far lower at another market within the same jurisdiction, as surveyed by our field officers. Now, the question: did the seller who sold at a lower price not also pay the transport fare?
‘’In a typical foodstuff market environment, this is how price fixing happens. A trailer-load of yam tubers arrives at Wuse market in Abuja from, say, Benue State. Rather than allow free trade, the market cartel then inserts themselves between the produce farmers and the retailers.
‘’They buy in large quantities from the producer at a cheap rate and, in turn, sell to market retailers at a much higher price. And the retailers, in turn, sell to consumers at cut-throat rates.
‘’Such price fixing is no longer acceptable and FCCPC will, henceforth, crack down on those involved in this profiteering scheme.
He also further berated the transporters for unduly doubling their fare simply because there was a slight increase in the price of petrol, adding that such action would only worsen the situation, as it would lead to a spiral increase in the prices of other goods and services.