Competition Commission: Fresh Produce Market Inquiry Final Report

Competition Commission: Fresh Produce Market Inquiry Final Report

• 17 January 2025
• Regulatory Compliance and Legislation
• South African Accounting Academy

Summary:

The Competition Commission has published its final report for the Inquiry into the Fresh Produce Market, which proposes sweeping changes to the way fruit and vegetables are sold and priced by retail giants in SA.

Article:

Supermarkets have been ordered by the Competition Commission to change the way they sell fruit and vegetables to make it easier for consumers to compare.

This is among the recommendations made in the final report following the commission’s Inquiry into the Fresh Produce Market.

The Inquiry's primary objective was to identify features within the fresh produce value chain that may impede, restrict, or distort competition. It focused on five fruits: apples, citrus (notably oranges and soft citrus), bananas, pears, and table grapes, along with six vegetables: potatoes, onions, carrots, cabbage, tomatoes, and spinach. These products are staples in South African households.

Retailers, namely Shoprite Checkers, Pick n Pay, Woolworths, the SPAR Group, Food Lover’s Market and Massmart, must display pricing on a “per 100 gram” basis for the 11 prioritised fresh produce products, in addition to any other pricing display chosen by the retailer. These retailers should, to the best of their endeavours, extend this pricing to all other fresh produce sold at their stores, and the weighed price should be displayed in such a manner that a consumer can clearly and easily identify that price. Most of these displays should be implemented within 12 months.

In total, the Inquiry proposed 31 practical recommendations aimed at promoting competition, reducing barriers to entry, and promoting a more inclusive fresh produce value chain. These include calls for policy reforms, market restructuring, and targeted support for small-scale and historically disadvantaged farmers.

Click on the links below to download the relevant document:

• Full Report (516 pages) (will be published in the Government Gazette and was submitted to the Minister of Trade, Industry and Competition) https://www.compcom.co.za/wp-content/uploads/2025/01/CC_FPMI-Final-Non-Confidential-Report-2025.pdf
• Executive Summary (40 pages) https://www.compcom.co.za/wp-content/uploads/2025/01/CC_FPMI-Final-Report-2025_ExecSummary_final.pdf
• Media Release https://www.compcom.co.za/wp-content/uploads/2025/01/FRESH-PRODUCE-MARKET-INQUIRY-FINAL-REPORT-RELEASED-13-Jan-2025.pdf

Relevance to Auditors, Independent Reviewers & Accountants:

• The Consumer Protection Act is yet another piece of legislation that your clients must comply with, and which you must assess compliance with.  If they don’t comply with the relevant laws and regulations, you have certain reporting obligations in terms of NOCLAR (NOn-Compliance with Laws And Regulations) – this could include reporting to management, qualifying your audit opinion, reporting a Reportable Irregularity, etc.
• As an auditor, independent reviewer and accountant, you need to consider publications and legislation that affect your relevant clients, e.g. fresh produce agents and distributors/retailers.
• As a consumer, you should be informed and aware of publications issued by regulators, e.g. Consumer Commission – especially as it affects your purchase and relevant rights relating to fresh produce.

Relevance to Your Clients:

• An entity (company or close corporation) has a duty to comply with the Consumer Protection Act.
• Distributors/retailers and agents of fresh produce should be aware of informed and aware of publications issued by regulators, e.g. Consumer Commission.

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