UNFAIR BUSINESS PRACTICES Commerce assures protection of NMI consumers

The closure of too many business establishments in the Northern Marianas in the last two years have raised concerns on the possible emergence of monopoly by those that will survive the economic crisis, thereby, giving birth to unfair business practices.

But even before the concerns go out of hand, the Department of Commerce assured the public that appropriate measures are currently in place to protect local consumers against unscrupulous businesses who may take advantage of the lessened competition in the market.

With the realities of more business establishments that are unable to weather the crisis shutting their doors down, local consumers continue to feast on cheap commodities flooding the CNMI market through clearance, inventory and closing out bargains.

Although seasonal bargains are here to stay, observers believe the advantages of closing down sales to the end-buyers are oftentimes short-lived since consumers are eventually faced with costly products due to lesser competition.

In an open market like the CNMI where the government allows businesses to freely establish consumer prices, lesser competition against high demand normally pushes commodity and service prices up.

While this scenario may lead to monopoly especially when the number of establishments involved in a particular field of business is further reduced, a monopolistic approach in doing business in a free market as the Commonwealth is not going to be a long-term problem.

When prevailing consumer prices start skyrocketing, new investors will come into the marker to compete and offer similar products at practically lower prices to the advantage and benefit of the consumers.

David S. Palacios of the commerce department said the Commonwealth has laws against the creation of a monopoly, as well as strings of policies and government agencies that coordinate at ensuring consumer protection.

Mr. Palacios cited a provision in the Commonwealth Code which specifically discourages leases, sales, contracts, conditions, agreements or understandings that lessens competition, including monopolies.

Existing laws also consider as illegal trade activities that would carry out restrictions in trade or commerce and would limit or reduce the production or increase the price of merchandise or of any commodity.

The Commonwealth Code reads, “It is unlawful for any person to lease or make a sale or contract for the sale of goods, merchandise, machinery, supplies or commodities for use within the Commonwealth, or to fix a price charged for them.”

An open market policy helps regulate the price of goods by enhancing the consumers’ control over price and quantity decisions.

In addition, other measures had also been put in place by the CNMI government to protect the interests of both consumers and businesses in the Northern Marianas.

The Consumer Counsel of the Attorney-General’s Office had been established to coordinate preventive and remedial consumer protection programs, and to prosecute those who violate CNMI’s consumer protection laws.

Also, a legislative measure — the Disaster Price Freeze Act of 1996, was already institutionalized to ensure consumers are protected against overpricing merchants in special cases or situations.

The CNMI has a consumer protection law which guarantees that the public interest requires that consumers be protected from abuses in commerce which deprive them of the full value and benefit of their purchases of goods and services.

It described as illegal the increasing of the cost of merchandise that has been previously been placed into the stream of commerce by having been offered to the public for sale at a specific price, indicated by the price tag or marking placed on the goods.