Carrefour has been found guilty of abusing buyer power by the High Court, upholding a previous decision by the Competition Authority of Kenya (CAK).

Judge Anne Ong'ijo ruled decisively against Carrefour, stating, "In conclusion, the court upholds the decision of the tribunal. The conduct by the appellant amounted to abuse of buyer power. The tribunal was correct in declining to set aside the Authority decision on the appellant's abuse of buyer power."

This legal battle began when Orchards Limited approached the CAK, alleging Carrefour had unilaterally delisted them by blocking their supplier code without prior notice.

This action left Orchards with substantial dead stock and financial losses.

Orchards had been supplying probiotic yoghurt under the brand name Cool Fresh to Carrefour between January 2015 and December 2018.

Read More

  1. Ex-NSSF boss loses appeal in Sh1.2 billion fraud case as court upholds 14-year sentence
  2. Mary Wamae retires from Equity Group after illustrious two-decade banking career
  3. Curtain falls on Blue shield Insurance Company as court orders liquidation

As part of the ruling, Judge Ong'injo ordered Carrefour to refund Orchards Limited Sh289,482 for rebates that were deducted from its invoices and imposed a penalty of Sh124,768 to the Authority for its abusive practices.

Carrefour had contested the CAK's decision, arguing it was denied a fair hearing and access to key evidentiary information.

However, the CAK maintained it had conducted the investigation with full adherence to legal protocols.

"The professionalism and objectivity by our staff members during the investigations has occasioned the positive outcome in this case," commented CAK board chair Shaka Kariuki.

Kariuki further noted the importance of the five-year legal process, which began in April 2019, in validating the Authority’s functions and rigorous investigation procedures.

Orchards Limited’s accusations against Carrefour included terminating their contract mid-negotiation in January 2019, imposing excessive listing fees and rebates, refusing full delivery, returning goods nearing expiry, demanding free merchandise, and requiring Orchards to provide shelf staff.

The CAK's investigation confirmed these claims, leading to a guilty verdict in February 2020.

Carrefour’s appeal to the Competition Tribunal in April 2021 largely upheld the CAK’s ruling.

In a subsequent appeal to the High Court, Carrefour succeeded in overturning only one of seven points, specifically the order to amend contracts with other suppliers, as these suppliers were not part of the original complaint or appeal.

This High Court ruling underscores the CAK’s authority in regulating market practices and protecting smaller suppliers from the unfair practices of larger retailers.