On 16th March, 2020, the Competition Authority of Kenya (“CAK”) issued a remedial order to a retailer, after it was determined that the retailer unconscionably adjusted the prices of a brand of hand sanitizers contrary to the Competition Act, 2010 (“the Act”). The order directed the retailer to refund all the consumers who had purchased the hand sanitizers above their usual selling price, by 26th March, 2020.
The Act makes it an offence for a person to engage in unconscionable conduct in the course of trade, in connection with the supply or possible supply of goods or services to another person. In determining whether one’s conduct is unconscionable, the Act provides that the CAK may have regard to, among others:
- the relative strengths of the bargaining positions of the person and the consumer; and
- the amount for which, and the circumstances under which, the consumer could have acquired identical or equivalent goods or services from another supplier.
According to the CAK, the retailer exploited its relative strength as a retailer, to the commercial detriment of consumers whose bargaining positions had been greatly diminished, following the announcement of the first case of the Covid-19 virus in Kenya.
It is the duty of the CAK to promote and enforce compliance with the Act, and as such, the CAK is empowered under Section 36 of the Act, to direct any action to be taken by an undertaking to remedy or reverse any infringement under the Act.
The retailer has apologized and agreed to refund the consumers who were overcharged for the hand sanitizers.
The notice by the CAK can be found here
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