Accountants and surveyors have written to the Competition Authority of Kenya (CAK) asking their members be allowed to impose minimum charges.
The Competition Act outlaws anti-competitive practices, including setting of minimum fees not only by the professions but also by industries such as insurance.
Accountants and surveyors have sought to be exempted from competition rules so as to continue charging minimum fees to clients.
The Institute of Certified Public Accountants of Kenya (ICPAK) and the Institute of Surveyors of Kenya (ISK) have written to the Competition Authority of Kenya (CAK) asking their members be allowed to impose minimum charges.
The CAK has been against the practice of restricting the amounts that professional associations charge their clients, maintaining that it is uncompetitive behaviour.
CAK director-general Kariuki Wang’ombe said while he had received letters asking for the exemption of the two professional associations from competition rules, it also expected to see a similar request from lawyers. “We have received requests from accountants and the Institute of Surveyors to exempt them from the competition rules. We are also expecting that lawyers will also make similar requests, but they have not done it so far,” said Mr Wang’ombe last week. Mr Wang’ombe said that the CAK was evaluating those requests, but did not hint as to what the final word would be. The Competition Act outlaws anti-competitive practices, including setting of minimum fees not only by the professions but also by industries such as insurance.
The CAK has recommended a tightening of the competition rules to minimise the practices following research done by the World Bank’s private lending and investment arm International Finance Corporation (IFC) showing extensive regulations of professions.
According to the CAK report drawing from the research, regulation of the accounting profession is slightly higher in Kenya than in western and Latin American countries.
“In terms of conduct, the principal restrictions come from marketing and advertising being restricted for service providers…these restrictions, therefore, limit market strategies available to professionals,” said the CAK report.
The conclusion of the report on the legal profession is the same; restrictions are higher than in advanced and southern American countries.
For example, foreigners are not allowed to practice in Kenya unless they work with a domestic counterpart and independent firms associated with foreign firms are not allowed to use the branding of their international partners.
Lawyers are not allowed to advertise their work but a 2012 high court ruling said the requirement was unconstitutional. The lawyers have since come up with advertising rules, but the CAK report has said they are still restrictive.
“These advertising rules are still restrictive and do not allow advocates to make reference to the fee charged, identify former clients nor mention any award obtained,” said the CAK report.
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