NAIROBI, Kenya, Jan 21 – The Competition Authority of Kenya (CAK) has punished Unilever for abusing its supplier bargain power.
CAK accuses the Fast-Moving Consumer Goods (FMCG) firm for influencing prices as well as number of products sold.
Buyer power is where a big company has the bargaining power than its suppliers.
“IT IS notified, pursuant to section 39 of the Competition Act, 2010 (“the Competition Act”), that in exercise of the powers conferred by section 38 of the Act, the Competition Authority of Kenya (“the Authority”) has entered into a settlement agreement with Unilever Kenya Limited (“Unilever”) after the Authority conducted investigations under section 24A (1) of the Competition Act,” CAK said in a Gazette notice.
Under the terms of the Settlement Agreement with CAK, Unilever is required to reduce payment term for all its existing SMEs firm 90-days to 60-days effective January 1.
Payment will also be reduced to 45-days starting January 1 2025.
Similarly, those onboarded after January 1 2023 will enjoy a 30-days.
Unilever is known for its products such as OMO, Vaseline, Knorr, among others.
It has also been urged to dedicate an annual budget of Sh75 million for supplier development training for its SME suppliers for a period of three (3) years from January 1 2023 to December 31 2025.
”Implement a competition compliance training program for a period of three (3) years between 1st January, 2023 and 31st December, 2025,” CAK acting Director-General Adano Wario said.
“Comply with the provisions of the Competition Act and all applicable relevant guidelines, which have the force of law from time to time,” he added.