FCCC to explore price controls and fair profit margins if they see exhorbitant prices charged to consumers

FCCC to explore price controls and fair profit margins if theAs a comprehensive market study into the grocery retail sector continues, the Fijian Competition and Consumer Commission says while it is important for businesses to make a reasonable profit, exorbitant price margins for important items are not ideal, especially with the current economic concerns.

While speaking about the current surveys and cost of living, FCCC Chief Executive Officer, Joel Abraham says in the past, they have seen some traders try to take advantage of the National Budget announcement to exorbitantly raise the prices of items, far beyond what might be expected from the announced changes.

He says prior to the budget, 160 surveys were carried out nationwide by FCCC teams to collect and establish baseline data and market prices for non-price-controlled items.

Abraham says this is so that after the budget, they have the required data to ensure that traders are not hiking the prices of goods and services to unfairly benefit from the budget announcement.

So far, following the budget, they have had 44 price surveys.

Their major line items currently under monitoring are Canned Fish (Local), Corned Meat, Toothpaste, Washing Powder, Dish Washing Detergent, Soap and Shampoo, Noodles, Assorted Biscuits, Baking Items, Whole Chickens, Chicken Portions, Lamb, Sausages, Baby Diapers, Sanitary Pads, Spare Parts, Stationery, Agricultural Products, namely pesticides, weedicides, fertilizers etc.

While speaking on recommendations, the FCCC says imposing price regulation is not the first policy choice, as FCCC seeks to promote market driven solutions.

Abraham says some of the items are not currently price-controlled but are still important to consumers and critical livelihoods.

He says based on the top selling products in major retail outlets, FCCC is monitoring these high volume essential and household grocery items closely, which will continue in the following weeks, and necessary recommendations will be proposed thereafter.

The FCCC says this may be in the form of price control for some of these items based on their assessment of the data that they are currently collecting through these surveys, as well as market studies and inquiries.

In addition to price control, they are also exploring potentially capping retail margins for some of these items.

However, they emphasise that any decision will be based on the findings of our the inquiry.

This will involve a thorough analysis of wholesale and retail margins, with possible recommendations of a new margin structure, whilst ensuring fair returns for stakeholders.

The FCCC will also review products and sectors that have been protected through duty and/or tax concessions.

This will involve assessing the impact that these concessions have at the retail level to determine how the benefits are being passed onto consumers and if there are areas that can be improved in this regard.

They say they understand that the issue of cost of living is very important and in line with their regulatory mandate to ensure a competitive, effective, efficient, and sustainable marketplace for all Fijians, their teams have been on the ground before the budget announcement.

Understanding the economic pressure faced by Fijians, the FCCC says it is particularly focused on reviewing cost structure to confirm that no Fijian consumer is being charged more than what would constitute a fair price.

While speaking on the market inquiry into the grocery retail sector, Abraham says the team has begun phase 1 of the study which is gathering data and information from relevant stakeholders.

So far, 47 stakeholders have been provided with a notice to furnish FCCC with the relevant documentation needed to carry out the market inquiry assessments.

Once phase 1 is completed, phase 2 will commence, and this involves tabulating and verifying the data and information.

This study will cover the status, size, structure and characteristics of the grocery retail sector market, including the market demand and supply and the nature of competition across the supply chain.

The factors affecting consumption patterns and trends in the sector will also be explored.

Abraham says the FCCC is particularly committed to closely monitoring the retail sector in the weeks following the announcement of the National Budget 2024-2025 to protect consumers.

He warns any traders who may be thinking of taking advantage of the transition period following the budget as changes are implemented that the FCCC will continue to keep a close eye on the retail sector in the coming weeks.

He stresses any unethical pricing practices will be dealt with severely, with offenders facing the full brunt of the law.