BUSINESS LIVE / 24 MARCH 2020 - 13:41 / BEKEZELA PHAKATHI
Fines and prison terms are in the offing for companies cashing in on the coronavirus
The government is tightening the screws on companies that cash in on the coronavirus by bumping up prices, trade and industry minister Ebrahim Patel said on Tuesday.
Trade and industry minister Ebrahim Patel. Picture: TREVOR SAMSON
He told a news conference that competition authorities are investigating 11 firms for selling products such as masks and sanitisers at inflated prices. Those found guilty will be fined up to 10% of turnover or one year in jail.
The coronavirus has wreaked havoc across the globe, rapidly spreading from its epicentre in Wuhan, China to more than 190 countries. On Monday, President Cyril Ramaphosa announced a three-week, nationwide lockdown, effective from midnight on Thursday, March 26, as the government tries to curb the spread of the virus.
Patel said the Industrial Development Corporation (IDC) has set aside R3bn to support businesses in distress. The IDC is a key national development finance institution set up to promote economic growth and industrial development.
Patel said the IDC will consider relaxing loan repayments to funded companies on a case-by-case basis.
The minister also elaborated on a list of essential services that will remain operational during the lockdown. The list includes heath practitioners; staff and service providers responsible for the generation, transmission and distribution of electricity; security personnel; agricultural and food supply-related operations; retailers, wholesalers, spaza shops and malls; financial services; and the media.
Meanwhile, the DA said it welcomed the the rejection by the government of the “absurd proposal by the department of small business development to link SMME funding during the national lockdown to race-based ownership”.
“This issue has caused mass panic in the business community across SA due to a leaked document from the department,” DA MP and trade and industry spokesperson Dean Macpherson said.
This is why the DA wrote to Patel, Macpherson said, to encourage him to put a moratorium on BEE requirements linked to funding and incentives because it would effectively miss 93% of all businesses that are BEE exempt and do not require black ownership.
“The DA is absolutely clear that funding must go to businesses that need it and that will keep people employed, regardless of the race, sex or geographical location of the business. The stakes are too high to be playing ‘battleships’ political ideology when so many jobs depend on quick and easy access to funding.”
LINK : https://www.businesslive.co.za/bd/national/2020-03-24-firms-investigated-for-covid-19-profiteering/
Disclaimer - The views expressed here are not necessarily those of the BEE CHAMBER