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NaCC rules against exclusive school uniform sales agreements

October 22, 2021
NaCC rules against exclusive school uniform sales agreements

The Namibian Competition Commission (NaCC) has warned schools against getting into exclusive uniforms supply agreements with suppliers saying the practice promotes uncompetitive behaviour.

“The Commission is of the view that these types of agreements may have adverse effects on competition. These agreements have the potential to prevent and lessen competition as they prevent other uniform supplying competitors from gaining access or growing in the market,” NaCC said on Friday.

“The Commission further established that this common practice that has existed for many years, places pressure on consumers (parents and guardians) to buy uniforms specifically from the schools’ preferred suppliers. As a consequence of these types of agreements, consumer welfare is on the other hand, reduced as consumers are denied the choice of sourcing uniforms from cheaper alternatives.”

NaCC said schools and uniform suppliers who are found on the wrong side of the law would be subjected to a fine.

“The Commission therefore wishes to advise involved schools and school uniform suppliers to refrain from further engaging in these exclusive supply agreements as they may be in contravention to the relevant sections of Chapter 3 of the Act and may be liable for a pecuniary penalty of up to 10% of an undertaking’s global turnover,” the Commission said.

“The Commission wishes to emphasize that it will be monitoring developments in the supply of school uniforms market and therefore reserves its right to investigate any possible anti-competitive practices in future, should the need arise.”

The decision by the NaCC comes after it had been inundated with numerous complaints from parents alleging possible anticompetitive practices in the supply of school uniforms to public and private schools in Namibia.

In light of the above findings, the Commission recommends that:

a) school uniform specifications be as generic as possible so that they may be obtained from different suppliers;

b) schools should provide these specifications to learners/parents/guardians to enable them to make informed decisions as to where they can source the supply of their uniforms;

c) schools to annually invite new and/or potential uniform suppliers for possible consideration as suppliers;

d) schools are encouraged to publish in local newspapers, social media and other platforms on an annual basis, extensive lists of suppliers from where school uniforms can be sourced;

e) schools should contract with all able school uniform suppliers following a transparent selection process in order to allow all potential suppliers to have an equal opportunity to compete;

f) contracts entered into between schools and uniform suppliers be limited to a short period of time, preferably 3 years renewable through a new open selection process;

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Last modified on Monday, 25 October 2021 17:19
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