Cement companies in Zambia ordered to reduce prices
The move comes after Zambia’s Board of Commissioners of the Competition and Consumer Protection Commission (CCPC) observed a sustained increment of cement prices between July 2019 and January 2020.
Zambia’s Board of Commissioners of the Competition and Consumer Protection Commission (CCPC) has fined Lafarge Zambia Plc and Mpande Limestone Limited 10% of their annual turnovers for the year 2019 and another 10% of their 2020 annual turnovers for price fixing and division of markets.
Dangote Cement Zambia Limited was, however, granted full leniency for having cooperated with the Commission during investigations.
In a statement on Wednesday (31 March) CCPC said, “Further, the Board has ordered Lafarge Zambia Plc, Dangote Cement Zambia Limited and Mpande Limestone Limited to revert to the pre-cartel prices ranging between US$4.50 – US%5 for a period of one year from the date of receipt of the Board Decision pursuant to Section 59 (3) (b) of the Act.
“Additionally, that Lafarge Zambia Plc, Dangote Cement Zambia Limited, Mpande Limestone Limited submit monthly average ex-works prices and any price adjustments be indexed to the exchange rate and be submitted to the Commission for review pursuant to Section 58 (1) of the Act; The Board has also ordered the three cement companies to develop and implement compliance programmes in their respective firms within 90 days of receiving the Board Directive,” the statement said.
“Furthermore, the Board has directed Lafarge Zambia PLC, Dangote Cement Zambia Limited and Mpande Limestone to make undertakings within 90 days of receiving the directive that their respective employees should not engage in any anti-competitive behaviour and that the enterprises should not facilitate and/or participate in any anti-competitive conduct including the exchange of information,” it added.
Why they were sanctioned
The decision to fine Lafarge Zambia Plc and Mpande Limestone Limited was made during the 49th Board of Commissioners meeting for the adjudication of cases held in Lusaka on 30 March 2021.
This was after an exhaustive investigation by the commission initiated in January 2020, following the Commission’s observations of a sustained increment of cement prices in the country between July 2019 and January 2020.
The continuous price increment of cement by the parties led the commission to suspect that there was possible collusion and an agreement to fix the prices of cement.
The investigation which lasted for over one year revealed that the parties shared price adjustment proposals seeking approval for price changes before the implementation date and in some cases before they were approved by their respective management.
“The exchange of commercially sensitive information on future prices and rebates demonstrated that there was a ‘meeting of minds’ among the respondents to pursue an agreed objective,” the statement said.
Read full statement below:
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