Executive Vice-Chairman/Chief Executive, Federal Competition and Consumer Protection Commission (FCCPC), Mr. Tunji Bello, on Thursday, read the riot act to traders, market leaders and other stakeholders over dubious market practices, marked by undue price inflation that defy explanation.
Speaking at the opening of a stakeholders’ meeting on the exploitative pricing hosted by the FCCPC in Abuja, Bello, bemoaned the growing trend of unreasonable pricing of consumer goods and services across the country on the one hand, and unwholesome practice of market associations engaged in price fixing on the other hand.
He said the practice had eroded consumer trust and threatened the stability of the economy.
He said as a responsive organisation, the commission had carried out discreet market surveys extensively across the country in the past few weeks to get to the root of the matter.
Bello stressed that the law empowers the commission to impose heavy fine for breaches and also prosecute offenders which could lead to jail terms.
He said the new initiative by the FCCPC aligned with the Renewed Hope agenda of President Bola Tinubu, which prioritises the welfare of the Nigerians in all economic activities.
He said the council was determined to uphold the agenda by ensuring that market practices do not exacerbate the economic challenges faced by citizens at a time of hardship.
He pointed out that as a sensitive leader who cares for the welfare of the citizens, Tinubu had already graciously taken some pragmatic steps to ease food security in the country, including the provision of fertiliser to farmers as well as removal of tariffs on the importation of selected staple food items.
Bello said, “It is only just and reasonable that distributors and traders pass down the gains to Nigerian consumers by reducing prices in the coming weeks”.
He urged all stakeholders to embrace the spirit of patriotism and cooperation.
According to him, Section 107 (4a.) of FCCPA clearly states that, “Where the undertaking is a natural person, is liable on conviction to imprisonment for a term not exceeding three years or to payment of a fine not exceeding N10 million or to both the fine and imprisonment”.
Also, Section 107 (4b) further stipulated that, “Where the undertaking is a body corporate, is liable on conviction to a fine not exceeding 10% of its turnover in the preceding business year.”
However, Bello said, “In the spirit of democracy, we are first exploring the option of dialogue. It is also in this spirit that we are giving a moratorium of one month (that is, September) before the commission will start firm enforcement.
“Let us work together to create a marketplace that is not only competitive but also fair and just. The FCCPC is committed to continuing these dialogues, monitoring compliance, and taking decisive action where necessary.”
In an interview, Bello said Nigerians are currently feeling the pinch of high inflation and illegal price increases, necessitating the intervention of the FCCPC.
He said, “As FCCPC, we have a responsibility here. We are also responsible for promoting competition in the market, and also for protecting the consumers in the long run.
“What we are saying is that there are situations where you have people fixing prices here and there, contrary to what is supposed to be achieved.
“Let us engage the traders, the retailers, the wholesalers, and every sector; and those who are responsible for allowing goods into the markets.
“And that’s what we have come to do and we have listened to them. We have heard their feelings. This is a very good feedback for us.”
He said the commission was not against businesses making profits from their legitimate activities.
However, he said, “What we are against is illegitimate surplus or profits that people are making. And there is a gang up already. And we are trying to prevent those gang ups from happening.
“What we are trying to stop is exploitation. We are not stopping people from doing their normal trade.”
Continuing, he said, “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.
“However, the margin in pricing of goods and services is rather unreasonable or excessive in not a few cases. 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.”
Giving handful illustration to further buttress his point, the FCCPC boss said, “For instance, our check just two days ago at a popular supermarket chain in Texas, United States, revealed that a fruit blender called Ninja is displayed on the shelf at $89 (roughly N140,000). Just two days ago.
Meanwhile, the same product was displayed at a popular supermarket at Victoria Island in Lagos for N944,999 on the same day and at the same hour. This represents more than 500 percent inflation of the cost.
“Interestingly, when our undercover officer visited the same supermarket two weeks earlier, this same blender was on display with the price tag of N750,000.
“The question then arises: what is the basis for this arbitrary hike in the price of the blender compared to the United States? What business principle can justify this level of profiteering?”
He also cited a few more of the unpleasant discoveries the commission made during its investigation in some notable supermarkets surveyed discreetly in Abuja, Kano, Port Harcout and Lagos.
He said, “We also found that prices were arbitrarily jacked up from time to time without any justifiable reason. In one particular big supermarket in Abuja, for instance, consumers were being charged N2,600 for an imported toilet soap at the payment point as the price tag was not displayed as earlier mandated by FCCPC.
“The same toilet soap was displayed for sale at N1,950 at a popular supermarket in Lekki, Lagos the same day.
“That already constitutes a double offense. 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 higher transport fare?”
He said, “Whereas the price of the same basket of tomatoes was far cheaper at another market within the same jurisdiction surveyed by our field officers.
“Now, the question: did the seller who sold at a lower price not also pay transport fare?
“In a typical foodstuff market environment, this is how price fixing happens. A trailer-load of yam tubers arrives Wuse market in Abuja from, say, Benue State.
“Rather than allow free trade, the market cartel then insert themselves between the produce farmers and the retailers.
“They buy in large quantities from the producer at cheap rate and, in turn, sell to market retailers at much higher price.
And the retailers, in turn, sell to consumers at cut-throat rate.”
James Emejo
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