Parliament Rejects Safaricom’s Petition to Not Submit Business Contracts to CAK

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Safaricom voice data issuesTelco Safaricom has failed to persuade the National Assembly Committee on Finance and National Planning to drop a clause in the competition law that tasks the carrier to reveal its business reports to the Competition Authority of Kenya.

The state’s largest operator had engaged the CAK and the Parliament Committee to drop the provision found in the Competition Act of 2010 that serves as a law for matters surrounding business competition in Kenya.

The case brought forth by Safaricom was, thereafter, rejected. In principle, companies are tasked by the CAK to divulge information about their operations which range from pricing of products to terms of payments.

According to Business Daily, Safaricom noted that “defining how parties should contract and the terms they should include in their contracts would constitute interference in the freedom of contract which is protected by law.”

Moreover, the carrier argued that such competition provisions heighten the risk of buyers being accused of abusing buyer power because of unjustified complaints since they will try to negotiate competitive terms with suppliers.

The National Assembly’s decision to reject the petition was supported by an argument that there was no harm is revealing and sharing supplier contracts with the competition authority, and that a variety of Kenya agencies look at different regulatory elements.

Lastly, CAK says that the provisions of the Competition Act of 2010 have been put in place to protect suppliers from dominant buyers, which, in this case, happens to be Safaricom (it cannibalizes other operators in terms of sheer market share) that has since refuted claims that it is a dominant player.