Council welcomes Commerce Commission’s findings on hardware industry

29/07/2010 16:51

The Consumer Council of Fiji welcomes Commerce Commission’s report on the investigation on hardware industry which concurs with our own findings of anti-competitive behaviour and unfair practices in the hardware sector.  The consumers themselves have experienced exorbitant prices and unfair practices in the hardware industry for far too long. The independent report from the Commerce Commission verifies Council’s concerns.

Housing is a basic human need. Its quality, cost and availability are crucial to an individual’s quality of life. How can we expect consumers to afford a decent shelter when the building materials for this shelter are made unaffordable to them through unfair and anti- competitive practices? 

We are appalled by the revelation that some hardware outlets were putting as much as 34000 % mark-up. Not only this but majority of these hardware materials are of sub-standard and inferior quality. This is grossly unfair to consumers and totally unacceptable when premium price was paid for sub-standard products. We cannot allow big business to continue deceiving the consumers and making huge profits unethically. Majority of the consumers in this country are already facing increased cost of living and low income. They don’t need unscrupulous traders further burdening them financially.

The Council had always maintained that there was lack of competition in the hardware sector and Commerce Commission’s report proves that anti-competitive practices such as price-fixing and transfer pricing exists in this industry.  If most hardware companies have “buying houses” abroad and Fiji companies buy their stock from their own foreign-based subsidiaries or “buying houses” then it is expected that Fiji consumers have to pay exorbitant prices. These buying houses in fact act as “middleman” and consumers are actually paying for higher prices despite the hardware dealer and it’s so called buying house being under the same ownership. Hardware companies engaging in such practices are not only unfair to consumers but also are deceptive against tax authorities by concealing actual revenue generation.

Council has always strongly opposed and denounced such anti-competitive behaviour. Price fixing- where some distributors set price for retailers so consumers would find the same prices being charged on particular goods by most hardware outlets– compromises the consumers’ right to choice on prices and is totally unacceptable.

The report on hardware industry is a great victory for consumers in Fiji and we trust that actions will be taken by relevant authorities and enforcement agencies to bring fair play in the hardware market. This is needed for the benefit of consumers as well as the country because increased hardware prices not only impedes on an individual’s satisfaction of basic needs but the entire growth and development of the country.