× Digital News Videos Health & Science Opinion Education Columnists Cartoons Lifestyle Moi Cabinets Arts & Culture Ramadhan Special Podcasts E-Paper Lifestyle & Entertainment Nairobian Entertainment Eve Woman Travelog TV Stations KTN Home KTN News BTV KTN Farmers TV Radio Stations Radio Maisha Spice FM Vybez Radio Enterprise VAS E-Learning Digger Classified Jobs Games Crosswords Sudoku The Standard Group Corporate Contact Us Rate Card Vacancies DCX O.M Portal Corporate Email RMS

New unit to fine, jail retailers for delaying suppliers’ cash

By Lee Mwiti | November 29th 2018
Traders display their Tomatoes at Daraja mbili open air market in Kisii County. [File: Standard]

Rogue retailers who withhold suppliers’ cash unduly now risk being slapped with fines of up to Sh10 million and lengthy jail terms.

This is after the Competition Authority of Kenya (CAK) formed a Buyer Power Department in a new push to address emerging concerns of contractual breaches by retailers.

“This prioritisation has been informed by the fact that the retail sector value chain has recently come under strain,” said CAK Director-General Wang’ombe Kariuki in a statement yesterday.

In December 2016, Kenya became the first country in Africa to adopt specific legislative provisions on buyer power through the competition law framework.

The retail sector has in recent years come under scrutiny for delayed payments to suppliers, which stood at Sh40 billion as at the end of December last year, with struggling retailers Nakumatt and Uchumi owing the bulk of the cash.

Justifiable reason

The new unit will now be allowed to investigate such cases, with the punishment for infringing the law being imprisonment for a term not exceeding five years, a maximum fine of Sh10 million or both.

Previously, CAK had no mandate to ask trade lobbies to provide details or even intervene in disputes between suppliers and buyers.

Take a quick survey and help us improve our website!

Take a survey

According to a statement from the authority, culprits will from now be subjected to penalties for delayed payments by a buyer without justifiable reasons in breach of contractual terms.

Unilateral termination (or threat of termination) of a commercial agreement without notice or a buyer’s refusal to receive or return goods without justifiable reasons and in breach of contractual terms will also land you in trouble. Others are buyers transferring costs or risks to suppliers.

Share this story
Six-star Sharks: Confederations Cup. Kenya’s representatives in pole after thrashing Djibouti opponents
Kariobangi Sharks dismantle Arta Solar in the debut in Africa and now head to Horn of Africa with their noses up.
I eagerly await my baby's first steps
Spina Bifida, and though rare in the general population, it is the most common neural tube defect in the world