Competition Commission v Cilliers and Heunis CC T/A Centrum Pharmacy (CR005Apr20) [2020] ZACT 95; [2020] HIPR 141 (CT) (20 April 2020)

Competition Commission v Cilliers and Heunis CC T/A Centrum Pharmacy (CR005Apr20) [2020] ZACT 95; [2020] HIPR 141 (CT) (20 April 2020)

The Tribunal confirmed that Centrum Pharmacy's conduct in increasing the mark-up on facial masks to approximately 150% during March 2020 constituted excessive pricing in contravention of section 8(1)(a) of the Competition Act, read with Regulation 4 of the Consumer Protection Regulations. The Tribunal accepted the Commission's findings that the price increases were not justified by corresponding cost increases and that the national disaster created conditions for temporary market power. The consent agreement, including undertakings to reduce mark-ups, donate essential goods, implement compliance measures, and circulate the agreement to staff, was confirmed as an order of the Tribunal,...

Citation
[2020] ZACT 95
Parties
Applicant: Competition Commission; Respondent: Cilliers and Heunis CC T/A Centrum Pharmacy
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
20 April 2020
Case Number
CR005Apr20
Procedural Posture
Consent Order Application / Order Confirming Consent Agreement
Outcome
Consent agreement confirmed as an order of the Tribunal, with specified undertakings and remedial actions.
Judges
Enver Daniels, Yasmin Carrim, AW Wessels
Legal Topics
Excessive Pricing, Covid 19 Regulations, Dominance, Consumer Protection, Mark Up Analysis
Competition Law Excessive Pricing Covid 19 Regulations Dominance Consumer Protection Mark Up Analysis

Case Brief

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Parties

Competition Commission

Applicant

Cilliers and Heunis CC T/A Centrum Pharmacy

Respondent

Procedural Posture

Consent Order Application / Order Confirming Consent Agreement

Legal Issues

  1. 1 Whether Centrum Pharmacy contravened section 8(1)(a) of the Competition Act by charging excessive prices for facial masks during the national disaster period.
  2. 2 Whether the price increases corresponded to cost increases or resulted in excessive profit margins.
  3. 3 Whether the conduct falls within the scope of Regulation 4 of the Consumer Protection Regulations for COVID-19.

Ratio Decidendi

The Tribunal confirmed that Centrum Pharmacy's conduct in increasing the mark-up on facial masks to approximately 150% during March 2020 constituted excessive pricing in contravention of section 8(1)(a) of the Competition Act, read with Regulation 4 of the Consumer Protection Regulations. The Tribunal accepted the Commission's findings that the price increases were not justified by corresponding cost increases and that the national disaster created conditions for temporary market power. The consent agreement, including undertakings to reduce mark-ups, donate essential goods, implement compliance measures, and circulate the agreement to staff, was confirmed as an order of the Tribunal,...

Court Disposition

Consent agreement confirmed as an order of the Tribunal, with specified undertakings and remedial actions.

Orders

  • Centrum Pharmacy must immediately desist from excessive pricing conduct as described.
  • Centrum Pharmacy must reduce its mark-up on facial masks to a specified percentage for the duration of the national disaster.