This archive report was first published on 18 May 2020.
As the COVID-19 pandemic continues to ravage the world, businesses in Kenya have taken advantage of the situation to engage in unfair business practices, including price-gouging and hoarding.
According to the Competition Act, 2010, such practices are considered business malpractices and are punishable by law.
Before the pandemic, dust masks were retailing at Sh150 for a box, but now they are selling at Sh1,500 for a box, a price increase of over 900%.
Price-gouging affects not only retailers but also manufacturers and suppliers, as it creates an artificial shortage of goods, leading to higher prices for consumers.
The Competition Authority of Kenya (CAK) has the power to investigate and penalize businesses engaging in such practices, including imposing financial penalties of up to 10 percent of the gross revenue of the previous year.
On March 2020, the CAK ordered a local retailer to refund to consumers an amount in excess of the ordinary price after it was found to have inflated the price of hand sanitisers by 20 percent.
Despite this decision, many businesses are still engaging in such malpractices, including manufacturing of sub-standard goods, such as masks and sanitisers without the standardisation mark.
The CAK has the power to investigate such practices and hear complaints, and it is hoped that the authority will crack its whip to deter price-gouging and hoarding, and protect vulnerable consumers in the market.
