Clarification on CCPC’s Intervention in bread prices

Dear Editor,
Kindly allow me space to clarify a few issues with regard to your story headlined “PF agency to interven in bread prices” published on 19th July 2012 in which various bloggers raised concern on why the Commission was getting involved in the matter.. Firstly, CCPC is a government agency created under the Competition and Consumer Protection Act No. 24 of 2010 to safeguard competition and protect consumers from unfair trading. My statement therefore was in line with the Commission’s mandate. The Act prohibits any behavior by firms operating at the same level of the production chain to engage in behavior that has the effect of preventing, distorting or restriction competition or substantially lessening competition in Zambia.
Specifically, section 9(1) (a) of the Act prohibits a horizontal agreement between enterprises that “fixes, directly or indirectly, a purchase or selling price or any other trading conditions.”A person who contravenes this provision commits an offence and is liable, upon conviction, to a fine not exceeding five hundred thousand penalty units (K90,000,000) or to imprisonment for a period not exceeding five years or to both or both while an enterprise is liable to pay the commission a fine not exceeding 10% of its annual turnover.
Further, i wish to clarify that the Commission in no way controls prices of goods and services as Zambia is a liberalised economic regime. But any conduct by enterprises where they uniformly raise prices of goods and services will naturally attract the Commission as this would appear to be cartelistic and therefore prohibited by the Act. Enterprises can raise or reduce prices independently of each other and not that they have directly or indirectly agreed. Independence in decision making by enterprises engenders competition.
Editor, thank you.
Brian M. Lingela
Director- Consumer & Education
CCPC

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