Food and Drink and Pharmaceutical Industries Should Not Raise Prices Unnecessarily Because of the Coronavirus
We have written an open letter to the pharmaceutical and food and drink industries warning firms that they should not capitalise on the current situation by charging unjustifiably high prices for essential goods or making misleading claims around their efficacy.
The Competition and Markets Authority (CMA) has published an open letter for businesses in the pharmaceutical and food and drink industries.
A copy of the letter mentioned above is given below:
Competition and Markets Authority
Senior Director, Markets
An open letter to the pharmaceutical and food and drink industries
We are in unprecedented times, during which the need for all sections of society to
pull together for the good of all will be significant. The services provided by your
sectors are important to the lives of many people at the current time, and it is vital
that trust can be maintained as we move through this time of crisis together. While
most businesses are striving to do the right thing under very challenging
circumstances, we have received reports that a minority of firms in your sector are
seeking to capitalise on the current situation by charging unjustifiably high prices for
essential goods or making misleading claims around their efficacy.
We are sure that you share our concerns not just about the unacceptability of such
practices in the current circumstances, but also the risk of undermining public trust
more widely across these sectors. If appropriate, the CMA has recourse to a range
of competition and consumer powers to tackle bad behaviour. It is therefore vital that
any poor behaviour is nipped in the bud now and we will use all of the powers
available to us to ensure that markets continue to work well during the coronavirus
We are determined to ensure that consumers are treated fairly through these difficult
times. We are therefore keen to work with you to ensure that the approach firms take
is clear, fair and supportive of trust among the wider public.
We understand that some price rises may result from constraints further up the
supply chain. For example, if an individual firm raises its prices as a result of passing
on increased prices from wholesalers or suppliers, then this may be unavoidable.
However, where this is happening, we would like to hear from you about any
information relating to such price increases by wholesalers or suppliers, so that we
can investigate these issues further up the supply chain. Please send any such
information in writing to firstname.lastname@example.org.
The food and drink and pharmaceutical industries are hugely important to the UK
economy and consumers and it is essential that these markets function well in the
months ahead. I urge firms to read and act on this letter to help ensure that the
harmful practices by a minority of bad apples are identified and stamped out quickly
so that consumers can rely on these vital markets when they need them most.
Senior Director, Markets
In relation to the same subject, CMA Chairman Lord Tyrie has said previously said:
“We will do whatever we can to act against rip-offs and misleading claims, using any or all of our tools; and where we can’t act, we’ll advise government on further steps they could take, if necessary.”
CMA Chief Executive Andrea Coscelli:
“We urge retailers to behave responsibly throughout the coronavirus outbreak and not to make misleading claims or charge vastly inflated prices. We also remind members of the public that these obligations may apply to them too if they resell goods, for example on online marketplaces.”