The Competition Authority of Kenya this week fined nine steel makers a record Sh338.8 million for engaging in cartel-like behaviour, including price fixing, punishing consumers with costly building materials that has seen some real estate firms go burst.
The firms fined include Devki Steel Mills, Doshi & Hardware, Brollo Kenya, Corrugated Steel, Tononoka Rolling Mills and Jumbo Steel Mills.
Others are Accurate Steel Mills, Nail and Steel Products and Blue Nile Wire Products.
The firms, some which are owned by prominent billionaires, were also accused of restriction of output leading to an inflation of their markup by at least 30 percent.
The fine, which is the highest penalty ever imposed for anti-competitive behaviour, with the last being Sh66 million against four paint manufacturers two years ago, has brought back into sharp focus the extent to which some firms are prepared to go to make profits at the expense of the consumer.
Steel is one of the most important construction materials. It is used to make reinforcement bars, beams and columns, windows, and doors, among other products.
The conduct of the Steel firms is a slap in the face for taxpayers, who have to shoulder the double blow. On one end is inflated prices and on the other, the firms enjoy some protection from external competition after Kenya slapped a 35 percent duty on imported finished steel.
The country is littered with unfinished real estate projects, a painful reminder for many potential homeowners, who have had to book expensive losses after the prices of building materials skyrocketed.
We laud the latest action and urge the watchdog to continue protecting consumers from harmful practices.
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