Maximum retail price set for bottled water not to apply to premium brandsTraders charging more than the maximum retail price may be fined Rs 200,000 to Rs 300,000, officials say.
The maximum retail price set for bottled water will not apply to premium brands, said the Department of Commerce, Supplies and Consumer Protection, which recently capped bottled water at Rs16 for a 1-litre bottle and Rs50 for a 20-litre jar.
Netra Prasad Subedi, director general of the department, said they would set the maximum retail price for premium brands too in the future.
According to the department, the new maximum retail price is for ordinary processed drinking water and not for bottled water for export or specially sealed bottled water.
Subash Bhandari, president of the Nepal Bottled Water Industries Association, said almost 90 percent of the bottled water plants in the country were producing ordinary processed drinking water and the rest produced premium processed drinking water.
“Premium brands such as Aqua 100, Bisleri, Bailley, Himalayan Spring, H2O and Rasuwa have a comparatively high cost of production due to the raw materials they use, and the consumer segment is also different for these brands,” said Bhandari.
According to Bhandari, these brands are packaged in polycarbonate jars. Ordinary bottled water is sold in 20 gram plastic bottles while premium brands come in 24 gram or 30 gram bottles which have a PCO cap and a different labelling system.
The premium brands use spring source water and have a different door-to-door delivery system, he added.
The retail price of premium brand bottled water is more than Rs25 for a 1-litre bottle. A 20-litre jar costs more than Rs80. Rasuwa brand water is produced from processed water obtained in Dhunche and costs Rs200 for a 20-litre jar.
In 2016, the government and the association agreed to set the maximum retail price of bottled water. The maximum retail price was fixed at Rs18 for a 1-litre bottle and Rs60 for a 20-litre jar. But the base price was not implemented and retailers were found charging more than Rs60 for a 20-litre jar.
Subedi said the maximum retail price had been reduced, and no one can stop somebody from selling at less than the set price in a free market. “Our main aim is to provide processed drinking water at reasonable prices,” he said. Bottled water companies can reduce prices to undercut their competitors.
The department said retailers buy jar water at Rs35 wholesale from bottled water companies and they cannot charge more than Rs50 retail. If the company or depot sells directly to consumers, they can charge Rs35 to Rs40, he said. Retailers have been charging Rs60-70, he added.
Traders charging more than the maximum retail price may be fined Rs200,000 to Rs300,000, said Sagar Mishra, director at the department.
Consumers were being cheated for lack of a fixed maximum retail price, said Bhandari. If prices are not set, the market could be flooded with imported products, he said.
Premium bottled water brands like Rasuwa are exported to Korea, Japan and Europe, but in limited quantities and not on a regular basis, said Bhandari.
The National Consumer Forum has repeatedly complained about customers being overcharged for bottled water. The maximum retail price was set on the basis of a report prepared by a task force consisting of department officials, representatives from the association and consumer rights activists.
“We had said that the price of a 1-litre bottle and a 20-litre jar should be set at Rs17 and Rs55 respectively, but our recommendation was rejected,” said Bhandari.
Department clarifies prices
KATHMANDU: The department on Tuesday clarified that the maximum retail price for packaged water fixed on Monday was lower than the market rate, amid criticism that the department had hiked prices in the name of setting the maximum retail price.
“The processed jar water company's price is Rs20, the distributor price is Rs35, the retail price is Rs40 and the maximum retail price is Rs50. The company price for processed water in 1-litre bottles is Rs110 per carton containing 12 bottles, the distributor price is Rs130 per carton, the retail price is Rs150 per carton and the maximum retail price is Rs16 per bottle,” said the department.
A market inspection done by the department found that 20-litre jars were being sold for up to Rs125, and 1-litre bottles for Rs85-Rs115 per carton.
The inspection team also found bottled water companies using jars or labels belonging to other firms, not printing the maximum price on the package, disregarding hygiene standards, not using acro filter and UV machine, not obtaining water quality certificate and selling water of dubious quality cheaply to consumers.
The new maximum retail price will be implemented on a trial basis in the Kathmandu Valley and Kavrepalanchok district from August 26.