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DLCA Suggests Consumers Boycott Gas Station Minimarts on St. Croix
BY SOURCE STAFF — AUGUST 24, 2015
The Department of Licensing and Consumer Affairs suggested Monday that consumers on St. Croix should consider not shopping at gas station minimarts as retribution for their charging higher fuel prices.
According to a news release Monday from the DLCA, the price of oil on international markets has fallen more than 50 percent in less than a year, from more than $105 a barrel in the summer of 2014 to $38 per barrel currently, with some analysts predicting further declines. But those global decreases have not been reflected in the territory, particularly not on St. Croix.
While St. Thomas fuel prices show some difference from station to station, on St. Croix, the average price of a gallon of gas and has fallen only 26 cents, holding steady at $3.39 for three months. Further, the DLCA noted, the price is identical at every station on the island.
"This is a free market economy, but essential to the free market system is competition, which provides choices to the consumer. With no competition, the consumer is left with no choice as where to purchase," according to the news release.
The agency also said that an April analysis showed St. Croix service stations are "realizing healthy profits while paying less for their gas purchases from the wholesaler."
The Virgin Islands Code provides the Department of Licensing and Consumer Affairs with the statutory duty to educate and guide consumers in the best use of their income and to promote on behalf of consumers, fair and honest practices of commerce and industry in business’ transactions with consumers.
"Consumers must make wise, informed decisions on spending their money," the DLCA said. "As an example, many if not all gas stations in the Virgin Islands have minimarts as an added amenity. While the consumer may not have much choice where to buy their gas, they certainly can choose to not patronize other aspects of a gas station’s business."
The agency said consumers "must exercise the power they have to make choices as to where and how they spend their hard-earned money."
The release said DLCA plans additional action "authorized by statute to bring relief to the consumer of the Virgin Islands."
The DLCA can be reached at 340-713-3522 on St. Croix or 340-714-3522 on St. Thomas.
(While prices here in STT vary from station to station, we have a few that regularly have a price of regular gas at $3.0999 a gallon for quite awhile now).
Posted : August 25, 2015 9:18 am
Since they all sell for the same cost, I buy from the station that treats me the best. My favorite station has always given me a free soda or beer with every fill up.
Posted : August 25, 2015 10:19 am
Gas stations, like any other private enterprise, are free to make as much profit as they're able.
Posted : August 25, 2015 11:17 am
Gas stations, like any other private enterprise, are free to make as much profit as they're able.
Yet price fixing is illegal.
Posted : August 25, 2015 11:20 am
At every store I have been to on STX except for 2, milk is sold at $5.99 per gallon.
Only one sells for less. That would be price fixing also?
Posted : August 25, 2015 11:22 am
Topic starter
Price fixing is a conspiracy between business competitors to set their prices to buy or sell goods or services at a certain price point. This benefits all businesses or individuals that are on the same side of the market and involved in the conspiracy, as prices are either set high, stabilized, discounted, or fixed.
How Price Fixing Violates the Law
Price fixing violates state and federal competition laws, which prohibits businesses collusion. Business collusion is an agreement between businesses that fraudulently prevents other businesses from being able to compete in the open market. Price fixing violates competition law because it controls the market price or the supply and demand of a good or service. This prohibits other businesses from being able to compete against the businesses in the price fixing agreement, which prevents the public from being able to expect the benefits of free competition. This violation can be implied or express, with minimal evidence needed to prosecute.
Even if there is evidence that competitors have appeared to agree on a price, this can lead to a collusion charge. Price fixing can be prosecuted federally as a criminal violation under the Sherman Antitrust Act or a civil violation under the Federal Trade Commission. Price fixing can also be prosecuted under state antitrust laws.
How Price Fixing Happens
Price fixing can happen several ways. Businesses can agree to set their prices high, so that consumers have no choice but to buy at the high price. They can also agree to set mark-ups, sales, surcharges or discounts on goods or services at the same rate. Businesses can also agree to set their maximum purchasing price so that a seller of a product, service or commodity will be forced to sell at the set price. Price fixing can also happen in the credit market, where companies agree to standardize credit terms to consumers. Many states have “below sales-cost laws,” which prohibit businesses from selling goods or services below market cost, if their intent is anti-competitive.
It is important to remember that illegal price fixing only occurs when there is an agreement between businesses to fix prices. A business, acting on its own, may use legitimate efforts to obtain the best price they can, including the ability to raise prices to the detriment of the general public. Further, businesses that conform to the same prices without an express or implied agreement are not in violation of price fixing laws. However, there is a fine line between conforming to prices at one’s own accord, and having an implied agreement to do so.
Read more: http://business-law.freeadvice.com/business-law/trade_regulation/price_fixing.htm#ixzz3jpXA7s2q
Sherman Antitrust Law:
http://business-law.freeadvice.com/business-law/trade_regulation/anti_trust_act.htm
Guide to Antitrust Laws:
https://www.ftc.gov/tips-advice/competition-guidance/guide-antitrust-laws
Posted : August 25, 2015 11:47 am
I'm not a gas station owner and have to buy gas like everyone else. But, the DLCA has yet to bring charges of price fixing or collusion against any gas station operator and its unlikely that they will, hence the boycott the mini mart message.
I can tell you as a local business owner that I am constantly monitoring my competitors pricing and conducting secret shopper visits both in person and on the phone to ensure we're as competitive as we can be.
In my past life as a senior marketing manager in the food ingredient business, it wasn't uncommon for a competitor's price list to magically and anonymously appear on our fax machine a few weeks before they wanted to put through an increase. Sometimes we followed, sometimes we didn't. But, we all knew when a price change was coming.
I'm not saying its right, but it happens everywhere.
Posted : August 25, 2015 4:53 pm
Topic starter
All I'm going to say is that stateside prices are expected to fall to $2 per gallon for gas and that while WAPA rates have decreased, I'm still seeing food prices continue to rise here.
Posted : August 25, 2015 5:41 pm
yep alana. just the same old same old for us.
Posted : August 26, 2015 10:54 am
