The Competition Authority of Kenya (CAK), established under the Competition Act No.12 of 2010, has taken a strong stance against anti-competitive behavior by penalizing nine steel manufacturers. Following an investigation, the CAK has imposed fines totaling KES. 338,849,427.89 on companies engaged in cartel conduct. This conduct artificially inflated the prices of steel products, contributing to higher construction costs for homes and infrastructure projects.
The penalized companies include Nail and Steel Products Limited, Brollo Kenya Limited, Blue Nile Wire Products Limited, Tononoka Rolling Mills Limited, Devki Steel Mills, Doshi & Hardware Limited, Corrugated Steel Limited, Jumbo Steel Mills, and Accurate Steel Mills Limited. These entities were found guilty of price fixing and output restriction, both of which hinder competition and harm consumers. The penalties, the highest ever imposed by the Authority, reflect the commitment to combat anti-competitive practices and restore fair competition in the sector.
Dr. Adano Wario, the Acting Director-General of the Authority, emphasized the significance of the penalties. They aim to address the concerns of consumers who have been affected by high steel prices and discourage companies from resorting to anti-competitive strategies. Dr. Wario highlighted that cartels undermine the principles of a free economy and manipulate market dynamics for their commercial gain.
In addition to the penalties, the Authority is engaging with five other steel firms to seek settlement negotiations, as per the provisions of the Competition Act. This approach aims to swiftly and effectively resolve matters and restore competition in the sector. The outcome of these negotiations will be published in the Kenya Gazette.
The intervention in the steel sector aligns with the Authority’s efforts to foster a competitive construction market and support the government’s initiatives, including affordable housing projects. The CAK’s strong stance against anti-competitive behavior in various sectors demonstrates its commitment to maintaining fair market practices and safeguarding consumer interests.