The UK competition watchdog has lobbied the government for emergency powers to crack down on companies profiteering from the pandemic after finding itself hamstrung by existing laws, reported The Financial Times.
The Competition and Markets Authority has asked the government for “emergency time-limited legislation” to pursue retailers bumping up prices for products such as hand sanitizes and face masks in response to the virus. The CMA received 21,000 complaints between March 10 and April 19 related to Covid-19, including alerts about price gouging.
The average price increase across all such reports was 130 per cent — and in the case of hand sanitisers, an average of 367 per cent. It has promised to take enforcement action where necessary. But competition lawyers say the watchdog is all but powerless to penalize offenders because of the limited nature of competition and consumer laws in the UK, which do not cover price gouging.
CMA chief executive Andrea Coscelli said he had spoken to the Department for Business, Energy and Industrial Strategy (BEIS) to advise them of the need for temporary new laws: “Consumer and competition law are not really designed for emergencies,” he said. “Part of our role is to use everything we have but if there are gaps, to explain to the government what those gaps are. Ultimately though it’s for the government and parliament to decide.”
In March, Boris Johnson, prime minister, told the House of Commons that new laws were needed to tackle “profiteering”. Business secretary Alok Sharma also met Amazon and eBay in April to discuss price gouging on their sites.
However, the business department is understood to be lukewarm on the idea of laws on price controls. One government official said it was “not something we are actively pursuing at the moment”. In a statement a spokesperson said: “The CMA deals directly with firms to address any complaints and we continue to keep the issue under review.”