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Corporates: Watchdog warns of prison term for cartel-like behaviour

By -NICHOLAS WAITATHU | May 13th 2014 at 12:00:00 GMT +0300


Businesses practicing cartel like behaviour in various key sectors of the economy thus frustrating promotion of competition will be prosecuted, Competition Authority of Kenya (CAK) has warned. 

The antitrust watchdog yesterday cautioned that it is investigating practice of unethical trade practices and abuse of dominance with a view to safeguarding the interests of consumers and farmers.

CAK Director General Wang’ombe Kariuki said any merchant who would be linked to cartel tactics in the local market would be fined Sh10 million or jailed for a term of five years.

Mr Kariuki said investigations are already being conducted in transport, insurance, shipping, milling, banking, cement, sugar, health care and tea. 

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Consumers have been complaining of cartel like behaviour in the said sectors, saying they have been subjected to a lot of suffering in terms of high prices and, low quality services and high cost production.

Kariuki was speaking during a trader’s association workshop at a Nairobi hotel yesterday.

Various industry associations including East Africa Tea Traders Association and Kenya Bankers Association attended the workshop organised by the authority.

Kariuki said the authority has been investigating the sectors for various restrictive trade practices offences for the last two years.

In the next two months, he disclosed, the authority would start publishing some of the reports on limiting and controlling production, market outlets and technical development. 

“Further we are probing claims on fixing prices, market segmentation, collusive tendering and abusing of intellectual property rights,” Kariuki told the trade associations.

Kariuki said players in the said sectors have been accused of fixing prices, collusion in terms of allocating market, excluding new entrants, and recommending suppliers.

Businesses Authority of Kenya Competition
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