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Competition Authority to reward informants in new scheme

By Sara Okuoro | January 21st 2021 at 13:30:00 GMT +0300

CAK Director-General Wang’ombe Kariuki.

The Competition Authority of Kenya (CAK) has launched an Informant Reward Scheme for an incentive of up to Sh1 million.

The Authority says the scheme provides a mechanism and framework for informants to receive financial incentives in exchange for actionable information in the course of the Authority’s investigations.

“An informant who provides credible intelligence leading to closure of an investigation through penalisation, is entitled to up to 1 per cent of the administrative penalty imposed by the Authority. However, the payment shall not exceed Sh1 million,” said the Authority.

The Scheme is targeted at persons with credible intelligence regarding restrictive trade practices, mainly cartel-like conduct. This includes agreements between undertakings to fix purchase and selling prices, maintenance of minimum resale prices, controlling production levels and market allocation, and collusive tendering.

The programme extends to misrepresentation and safety of products, abuse of dominance, abuse of buyer power, mergers and acquisitions implemented without approval, and unconscionable conduct.

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“Cartels, which harm consumers through impeding choice, innovation and increasing prices, flourish under a veil of secrecy,” said CAK Director-General Wang’ombe Kariuki.  

“Through this Scheme, the Authority has the objective of deepening its intelligence gathering capacity with regard to such clandestine operations using informants who are close to the conduct, but not party to it.”

A confidential informant, for instance, can be an employee who was directed by their superiors to attend a meeting between competing firms where price fixing was discussed, but did not actively participate in the decision-making.

The Authority says it is committed to ensuring that the identity of informants is not compromised.

The Scheme became effective on January 1, 2021.

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