The competition watchdog is setting up a coronavirus taskforce to crack down on companies that cash in during the outbreak by bumping up prices or exploiting people’s fears with misleading claims about products.
The Competition and Markets Authority said it had already contacted traders and online trading platforms about excessive pricing of hand sanitiser, sales of which have soared as part of efforts to prevent the spread of the virus.
Action will be taken against firms that breach consumer protection or competition laws if they do not respond to warnings. The taskforce will also advise government on emergency legislation if problems cannot be addressed through existing powers.
Andrea Coscelli, the CMA’s chief executive, said: “This is obviously a time when we all have to behave responsibly to protect our fellow citizens, and particularly those who are most vulnerable. We urge retailers to behave responsibly in the exceptional circumstances of the Covid-19 outbreak.
“But if they do not, our taskforce is monitoring market developments to enable us to intervene as quickly as possible. We have a range of options at our disposal, from warnings to enforcement action to seeking emergency powers. We hope that such action will not be necessary but we will do whatever is required to stop a small minority of businesses that may seek to exploit the present situation.”
The taskforce is being established after the CMA said it was considering asking the government to regulate prices of hand sanitiser and other protective kit relating to the coronavirus. With an increasing number of products sold out or rationed in many stores, shoppers have turned to online retailers.
Amazon has admitted it is struggling to prevent profiteering as “bad actors” attempt to cash in on coronavirus fears by raising prices of masks and sanitisers by as much as 2,000%.
The US company said it had removed “tens of thousands” of listings. Other websites, including eBay, Walmart and Etsy, have also struggled to limit profiteering by sellers.