Dangote Cement Zambia Limited has been granted leniency by Zambia’s Board of Commissioners of the Competition and Consumer Protection Commission (CCPC) for engaging in price-fixing and market sharing for its cement product with two other cement manufacturers in the country.
The leniency granted Dangote Cement, as noted by the CCPC was due to the company’s cooperation with the Commission during its investigations on the matter as well as the the company’s application for leniency.
The two other cement manufacturers – Lafarge Zambia Plc and Mpande Limestone Limited – were however, fined a cumulative 20 percent of their annual turnovers for 2019 and 2020.
Investigations into the activities of Dangote Cement Zambia Limited, Lafarge Zambia Plc and Mpande Limestone Limited by the CCPC, followed observations of a sustained increment of cement prices from an average of K55 (Ghs 14) to K100 (Ghs 26) per 50Kg bag between July 2019 and January 2020.
The continuous price increment of cement by the parties, the Commission notes, led it to suspect that there was a possible collusion and an agreement by the three cement manufacturers to fix the prices of cement in the country.
According to CCPC, its investigations established that company representatives from Mpande Limestone Limited, Dangote Cement Zambia Limited and Lafarge Zambia Plc held discussions and meetings which resulted in the development of a pricing philosophy to stop cement price reductions.
CCPC, after the cumulative 20 percent fine on the 2019 and 2020 annual returns of Mpande Limestone Limited and Lafarge Zambia Plc, further ordered that Lafarge Zambia Plc, Dangote Cement Zambia Limited and Mpande Limestone Limited to revert to the pre-cartel prices ranging between $4.50 – $5 for a period of one year from the date of receipt of the Board’s Decision.
Additionally, Lafarge Zambia Plc, Dangote Cement Zambia Limited and Mpande Limestone Limited must submit monthly average ex-works prices and any
price adjustments be indexed to the exchange rate and be submitted to the Commission for review.
The Board also ordered that the three cement companies develop and implement compliance programmes in their respective firms within 90 days of receiving the directive.
Read below details of the CCPC’s press statement on price-fixing by Dangote Cement: