The Competition Authority of Kenya (CAK) has imposed a hefty Sh.1.1 billion fine on the French retail giant Carrefour, accusing it of misusing its influence over suppliers.
In a statement released on Tuesday, CAK revealed that the supermarket chain, managed by Majid al-Futtaim based in the UAE, had mistreated its power to dictate terms to two suppliers, Pwani Oil Products Limited and Woodlands Company Limited.
The investigations conducted by the authority uncovered that Carrefour imposed three non-negotiable rebates, reaching as high as 12 percent, on its suppliers.
- Arrest Made In Connection With Police Officer’s Fatal Stabbing And Gun Theft In Siaya
- Who Is Paul Gicheru? Family, Career, Controversies, Death
Rebates, defined as a percentage of sales refunded by a supplier to its customer in exchange for benefits, such as early payment or meeting purchasing targets, were utilized by Carrefour to deduct annually and monthly.
These practices led to a consistent reduction in the final payout to suppliers.
CAK also found that Carrefour compelled suppliers to offer free products, pay listing fees for each new branch opening, and station employees at the supermarket’s branches.
According to CAK, these practices amounted to the unlawful transfer of the retailer’s costs to its suppliers, violating the Competition Act.
Carrefour now faces a significant fine of Sh.1,108,327,873.60, the largest ever issued by CAK.
The regulator has mandated the supermarket chain to revise all supplier contracts, removing clauses that enable buyer power abuse, such as listing fees, rebate collections, and unilateral delisting of suppliers.
In addition to the fine, Carrefour has been instructed to reimburse Woodlands and Pwani Oil a total of Sh.16,757,899 in rebates deducted from their invoices, along with Sh.500,000 billed as marketing support for store openings and listing fees.
This penalty marks a historic enforcement action by CAK against Carrefour, which entered the Kenyan market in 2016 and has since grown into one of the country’s largest retailers under Majid al-Futtaim’s management.
Gang Raids Nyamira Home, Defiles 17-Year-Old Girl, Robs Family
