Kenya’s Competition Tribunal has ordered French supermarket chain Carrefour to revise its agreements with suppliers in the next 30 days after finding the retailer guilty of abuse of buyer power.
The tribunal’s ruling backs a similar pronouncement by the Competition Authority of Kenya, which in February 2020 found Carrefour Kenya in breach of fair competition practices by forcing its suppliers to issue rebates and pay listing fees to have their goods on its shelves between 2015 and 2018.
The retailer had also been accused of transfering commercial risk to the supplier and unilateral delisting of suppliers.
Majid Al Futtaim, which holds the Carrefour franchise in more than 30 countries across the Middle East, Africa, and Asia, appealed against the authority’s decision through the tribunal. Both rulings say the current supplier agreements give the retailer an unfair edge over its competitors through huge discounts to customers, but to the detriment of suppliers.
Carrefour opened its first retail store in Kenya in 2016, and now operates 12 outlets across the cities of Nairobi and Mombasa. Its sales in East Africa’s largest economy jumped 28% between 2018 and 2019 to $172m (£124m).
This growth came at a time when home-grown supermarket brands such as Uchumi and Nakumatt collapsed.