Reckless and predatory prices of goods- A necessary reform

The Office of the Consumer Protection (OCP) must initiate a price catalogue to prevent reckless and predatory price of goods in the country. The experience and reports on an unreasonable hike in price during the last six months of the pandemic is evident that business entities took advantage of the situation.

During the 21-day national lockdown, consumers were restricted only to over 21 essential goods and vegetables. Due to the dire need of essentials, consumers not only sacrificed the right to inspect the quality and quantity of goods but were also forced to pay the price at the behest of the state corporations, the state selected suppliers and retailers. Social media was flooded with suspicions of suppliers charging the prices at their whims and fancies. The intervention of OCP have served only a few consumers and most suppliers remain indifferent to the consumer’s right to a fair price.

Right to a fair price, correct quantity and non-defective goods are fundamental rights of consumers, well enshrined under the Consumer Protection Act of Bhutan, 2012 (CPA). Section 9 and its regulations protect the right to price by requiring the mandatory display of goods. In the absence of a price catalogue, price of goods remains uncertain. Even if the prices are displayed, fairness is questionable.

A BBS report on FCB charging a higher price for rice to Silambi in Mongar is just a tip of the iceberg. FCB’s justification for the price hike is appalling. It was deliberate, may constitute fraud or deception. It shows how suppliers can easily get away with deceptive practices. The requirement of the display of prices is based on the principle of fair and reasonable price. Section 9 of CPA prohibits business entities from charging any arbitrary or unreasonable or deceptive prices for the goods as in the Silambi incident.

It is fortunate that most business entities in Bhutan fix prices of goods relying on the Maximum Retail Price (MRP). However, the application of MRP on goods in Bhutan lacks legal basis because, MRP is fixed based on the Consumer Goods Act, 2006 and Weights and Measures Act of India for consumers in India. OCP has no legal authority to enforce existing MRP in Bhutan.

Section 90 of CPA and Rule no. 81 of Consumer Rules and Regulations 2015 mandates OCP to publish “standard catalogue containing prices.” OCP is almost a decade old and it has been six months since the pandemic hit us, yet there is no price catalogue on even the essential items. Prices were fixed on few commodities but those remained confined only to selected markets. OCP and other authorities have failed thus far, leaving the price of goods completely uncertain undermining the objectives of CPA.

OCP must take cognizance of the current scenario and fulfil their duty of initiating a price catalogue at the earliest. It is a herculean task but not impossible. Since almost all our goods are imported, the initiation of a price catalogue is a lot easier as import price is already known.  OCP must first start with the essential items. Non-regulation of prices may lead to more economic inequality and affect poverty alleviation efforts. Contrarily, the determination of prices will encourage more business to declare goods and help reduce tax evasion. Till such time, consumers will continue to suffer at the reckless and predatory pricing by the business entities at their whims and fancies.

Sonam Tshering

Lawyer, Thimphu

Disclaimer: The views expressed in this article are author’s own.

0 replies

Leave a Reply

Want to join the discussion?
Feel free to contribute!

Leave a Reply