The Commission has opened an investigation into suspected price fixing of mealie meal prices by the Millers Association and its Members. On 29th October 2015, a team of Investigators from the Competition and Consumer Protection Commission (CCPC) conducted a search (“dawn raid”) on 4 major milling companies in Lusaka for suspected engagement or facilitation in the fixing of mealie meal and flour prices.
Four (4) Teams of Commission Investigators arrived simultaneously at the premises of the Millers’ Association of Zambia (MAZ), National Milling Corporation (NMC), Superior Milling Company Limited and Simba Milling Company Limited in Lusaka around 10:40hours in search of documentary evidence showing that the Association and its members were coordinating in setting mealie meal and flour prices, conduct likely to result in the prevention, restriction or distortion of competition in the supply and pricing of the two commodities.
The Commission has observed that in the period between 2010 to 2015, the Millers’ Association of Zambia (MAZ) acting with other parties are reasonably suspected of participating in or facilitating conduct likely to result in the prevention, restriction or distortion of competition in the supply and pricing of mealie meal and flour. The Commission suspects that the Association and its members have been agreeing to simultaneously increase the price of mealie meal and flour. On 4th October 2015, MAZ issued a press statement informing the general public that it had together with its members resolved to increase the price of mealie meal by between K10 and K15 per 25kg bag, thereby triggering a price increase of the country’s staple food.
The alleged conduct by MAZ and its members is contrary to Sections 8 and 9(1) (a) of the Competition and Consumer Protection Act No. 24 of 2010 which prohibits agreements, decisions or concerted practices that prevent, restrict of distort competition and agreements that fix, whether directly or indirectly, a purchase or selling price or any trading conditions of goods and services.
A Director whose company is found liable upon conviction by a court of law for violating the law will be fined not exceeding five hundred thousand penalty units or to imprisonment for a period not exceeding five years, or to both. In addition, a company that is found guilty is liable to pay the Commission a fine not exceeding ten percent of its annual turnover.