South Africa: government unveils regulation to stop stockpiling and prevent price hikes

The government in South Africa has introduced regulations that will protect consumers from the adverse effects of the coronavirus pandemic by curbing stockpiling and preventing unfair price hikes of essential goods. 

The provisions were announced by Trade, Industry and Competition Minister Ebrahim Patel at a press conference on Thursday. They stipulate that price rises may not exceed increases in the cost of raw materials and that profit levels should not be any higher than in the period immediately prior to the outbreak.

“We are doing this to ensure that we don't have unjustified price hikes or stockpiling of goods. We are doing this to protect consumers and ensure fairness and social solidarity during this period," said Mr Patel.  

“The regulations will cover the full supply chain and will limit price increases of suppliers," he added. 

Retailers will also be required to take steps to curb customer stockpiling, ensuring that essential products remain available for all, including on the weekends and at the end of the month. 

Any breach in the new regulations will result in penalties ranging from a R1 million fine to docking 10% of the company’s turnover and jail sentences of up to a year. 

The government announced that should companies fail to comply with the new measures, it may be forced to set price limits on certain products.

The news comes as South Africa takes drastic measures to curb the spread of the coronavirus, including the closing of all bars, restaurants and clubs, and deploying additional law-enforcement officers to ensure the public complies with new safety measures. 

Photo: SANews