Majid Al Futtaim-run retailer Carrefour is set to fight the Sh1.1 billion fine it was slapped with by the Competition Authority of Kenya (CAK) at the Competition Tribunal.
The retailer said the record fine had taken it by surprise, which it claims to have come on the back of a resolution to its dispute with two suppliers—Woodlands Company Limited and Pwani Oils Limited.
“Majid Al Futtaim was surprised by the recent decision made by the Competition Authority of Kenya, which comes despite the withdrawal of complaints and renewed partnership agreements that have been signed with Woodlands Company Limited and Pwani Oils Limited.
Majid Al Futtaim has full confidence in the fairness and integrity of our business practices and is appealing the Competition Authority’s decision,” said Majid Al Futtaim in a statement on Wednesday. The CAK announced the fine on Tuesday.
Parties aggrieved by decisions made by the competition watchdog can file their appeal at the Competition Tribunal.
Carrefour has a 30-day window from its receipt of the CAK’s sanctions to appeal in writing to the tribunal.
The tribunal is expected to serve notice in the gazette announcing the review of the CAK’s decision, after which it shall invite interested parties to make submissions.
Subsequently, the tribunal is expected to decide within four months with the determination to either overturn the regulator’s decision, amend it or confirm it or refer the matter back to the CAK for reconsideration on specified terms.
The decision of the tribunal can also be challenged by either party through the filing of an appeal at the High Court within 30 days of its determination.
Majid Al Futtaim has already walked down the tribunal route having challenged the CAK’s decision to pay Orchards Limited Sh289,482 in rebate reimbursements and Sh130,856 for the loss arising from the termination of the supplier’s agreement in 2019.
Orchards, a yoghurt manufacturer, had protested the requirement to pay a Sh50,000 listing fee for each product sold in Carrefour’s stores.
Following the tribunal’s decision to confirm CAK’s enforcement action, Carrefour appealed the decision at the High Court where the matter rests currently.
The retailer had been widely expected to appeal the hefty Sh1.1 billion having stood by its operator model requiring rebates and discounts from suppliers despite complaints in recent years.
“Carrefour in Kenya maintains a strong network of over 700 supplier partners, 300 of which have been valued partners since we began operations in Kenya in 2016.
“We take pride in working collaboratively with all our suppliers to create a more sustainable and equitable business environment through ongoing engagement and transparent communication,” said Majid Al Futtaim Retail.
