FTC Working For Fair, Competitive Business Market

Remember the days when it was common to “marry” goods, where upon purchasing an item, you were told to receive it, you would have to buy something else?
And, have you ever been enticed to make a purchase at a particular store, having seen an item advertised at a particular price, but when you get there, the product is out of stock because it was in limited supply, and because you are already at the store, you feel obliged to buy another, more expensive item?
If these things have happened or are happening to you, then you are liable for redress under the Fair Trade Competition Act (FCA). Under the Act, these actions are seen as market manipulation practices and are deemed to be anti-competitive and a hindrance to the proper functioning of a market economy.
Among offences identified under the FCA are; misleading advertising, that is, any erroneous representation made to the public about the value or nature of a product; price fixing, where a business or individual seeks to influence the price of goods and services; exclusive dealing, which refers to a supplier seeking to induce customers to deal with that supplier only; and market restriction, where a supplier forces a dealer to make goods available only in specified areas rather than any area that the dealer may choose.
The Act also makes illegal, bid rigging, which is an agreement involving two or more persons to distort the bidding process for a work or commodities contract; abuse of dominance, which refers to using whatever means made possible by virtue of one’s dominant position to deny entry or force out competitors from the market; sale above advertised price, which is selling a product at a higher price than was advertised; and bait and switch, where a good is advertised at an attractive price and the merchant does not have reasonable quantities available for sale and so a buyer is induced to buy another but more expensive product.
Barbara Lee, Executive Director of the Fair Trading Commission (FTC), which administers the Act, tells JIS News that the rules are designed to rid the market of anti-competitive behaviour in order to facilitate the development of a healthy competitive environment in which businesses can thrive. In a liberalised, open economy such as Jamaica, the agency is seen as a necessary part of the free market infrastructure to ensure that all the players operate on a level playing field.
She notes that over the 10 years of operation of the FTC, the agency has facilitated major changes in the operation of a number of sectors, including the banking industry. She explains that at one time, persons were unsure, if not misled, as to the rates that they could get for their foreign currency. She points out that as a result of the intervention of the FTC, banks now display a rate board, which indicates the daily foreign exchange rates and that they are subject to change.
If there is no indication that the rates could vary throughout the day, then the consumer can assume that the rate given is set and is entitled to obtaining the foreign exchange at that rate.
The FTC was also instrumental in getting the banking industry to develop more “reader-friendly” loan documents and to secure changes to the wording of the terms and conditions on the back of credit card statements. The changes more clearly define the method used to compute the interest charges that are due on credit card payments.
Mrs. Lee notes that the FTC had also intervened in the monopolised telecommunications sector. She says that one of the earlier issues that the Commission had to deal with, concerned the installation of a voicemail service by Telecommunications of Jamaica (TOJ) on customers’ telephones, even if customers did not wish to have the service. The FTC was able to have the TOJ remove the service from the telephones of customers who do not wish to have it.
She says the FTC also came to an agreement with TOJ, to allow customers to acquire equipment from companies other than the monopoly and to install them on TOJ’s network without incurring liability. Prior to this agreement, customers could only connect equipment bought from TOJ. If the equipment was not in stock, and customers had obtained them elsewhere, then they were required to pay a rental charge to the monopoly.
“With competition, we have had to sort out that market in a way that Jamaica would be receptive to competition and to other entities coming in to challenge the monopoly and we had to deal with the issues that arose and continue to arise out of that challenge”, Mrs. Lee points out, noting that the FTC was able to establish a manual with guidelines and rules to govern the relationship between the dominant telecommunication company and other entities that eventually came into the market.
Meanwhile, in the used-car industry, Mrs. Lee says, “dealers are being made more aware of their responsibility in cases of warranty.and consumers are being made more aware of what they should demand”. She points out however, that most complaints that come in to the FTC, relate to the motor vehicle industry, involving both new and used cars.
Mrs. Lee says that the FTC is proud of its achievements over the years and is preparing itself to take on greater challenges when the CARICOM Single Market and Economy (CSME) comes into being in 2005.
“The CSME holds interest for the FTC as competition is going to be a big issue because we are moving from competition among firms in Jamaica to competition among firms across the borders in the various countries,” she points out.