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Ships contractors apply to regulator for exemption to fix prices among members

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Competition of Authority of Kenya (CAK) boss Wang’ombe Kariuki. FILE PHOTO | NMG

The Kenya Ships Contractors Association has sought permission to fix prices among its members, becoming the latest in a line of professional and trade associations to seek such exemptions from competition law.

Director-general of the Competition of Authority of Kenya (CAK), Wang’ombe Kariuki in a Friday notice asked members of the public to give their input to the application.

The Kenya Ships Contractors Association (KSCA) is applying for exemption from segments of the Competition Act that prohibit professional associations from imposing restrictions on their members that could distort or lessen competition.

The Association’s members provide a range of services to shipping lines docking at Mombasa, including cleaning, acquiring essential supplies (also known as chandlery), and in some cases clearing and forwarding.

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Their application to the CAK could face an uphill battle. Over the past one year the authority has made a number of precedent-setting decisions that indicate that it is hostile to price-setting in any form.

Most recently the CAK stopped surveyors and valuers from implementing price scales that are contained in legislation and regulated by the ministry of lands.

The CAK had previously rejected a price-fixing bid by accountants.

The anti-trust watchdog has argued that providing such exemptions would ultimately not be beneficial to the consumer and could serve to hike up prices while reducing incentives to compete.