Parents fearing another wave of school fee increases have been handed a glimmer of hope after the Competition and Fair Trading Commission (CFTC) warned education institutions against colluding to raise tuition fees, saying offenders risk massive financial penalties.
The Commission says it has received information suggesting that some associations are consulting their members on increasing tuition and other charges for schools, colleges and universities, citing rising operational costs.
However, in a press statement signed by Chief Executive Officer, Desmond Kaunda, CFTC has warned that while every institution is free to set its own fees based on its financial situation, any collective agreement or coordinated move to fix or recommend uniform fee increases is illegal.
“Any collective or coordinated effort by an association or an umbrella body to determine, recommend, or structure uniform adjustments of tuition fees or any service/product price amounts to anti-competitive business behavior as provided for under Sections 26 and 27 of the Competition and Fair Trading Act (CFTA),” reads part of the statement.
The regulator has also cautioned education institutions against imposing excessive fees, saying unreasonable price increases are prohibited under Sections 28 and 51 of the Act.
CFTC says it will not hesitate to launch formal investigations against any association or institution found engaging in collusive or excessive pricing.
The Commission warned that individuals found guilty risk penalties of up to five percent of their gross annual income, while enterprises could be fined up to 10 percent of their gross annual turnover.
“Be warned that, under Section 22(2) of the CFTA, the consequences for any Person or Enterprise engaging in the aforementioned prohibited practices are severe to the extent of paying a monetary penalty of up to 5 percent of their gross annual income (for Individuals) or up to 10 percent of their gross annual turnover (for Enterprises),” the Commission warned.
The Commission says it remain committed to protecting consumers and ensuring fair competition in the education sector.
