April 24, 2020 / 1:41 PM / a month ago

S.Africa's Dis-Chem rejects claim it hiked prices of surgical masks

JOHANNESBURG, April 24 (Reuters) - South African drug store chain Dis-Chem said on Friday it will oppose a referral to the Competition Tribunal after an investigation found it had inflated prices of dust and surgical masks during the coronavirus outbreak.

On Thursday, the Competition Commission, which investigates competition complaints and refers them to the Tribunal for prosecution, said it had found that Dis-Chem hiked the prices of those masks by as much as 261% during the State of National Disaster in early March.

In an emailed response, Dis-Chem said it was consulting its legal team and economic experts and would oppose the complaint referral.

“It does not believe that the information and data provided to the Competition Commission during its investigation establishes any contravention of the Competition Act,” the company said.

“Unfortunately, that information and data appears to have been misunderstood. Dis-Chem will be responding, in detail, to the allegations in the referral in due course.”

Dis-Chem said its pricing was within regulated guidelines and it did not engage in price-gouging or excessive price-fixing.

The Commission has asked the Tribunal to impose a maximum penalty against Dis-Chem.

The Commission is investigating more than 300 complaints against retailers and suppliers of essential goods for over-charging essential commodities when South Africa is struggling with a shortage of medical supplies and equipment.

Most complaints of excessive pricing were related to hand sanitisers and face masks, followed by toilet paper, flu medication and other products during the coronavirus outbreak, the Competition Commission said last month.

Last Wednesday, Babelegi Workwear Overall Manufacturers was referred to the Tribunal for hiking the price of face masks by 500%.

On Friday the tribunal said a Gauteng hardware store must refund its customers for the overcharge of surgical gloves and it must also reduce its mark-up on those gloves to 10% during the remainder of the pandemic period and for six months thereafter. (Reporting by Nqobile Dludla; editing by Barbara Lewis)

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