The Competition Authority of Kenya (CAK) has imposed record fines on nine steel manufacturing companies for their joint role in a price-fixing and output-restriction.
The fine, which is the highest-ever to be imposed by the CAK against anti-competitive practices, was set at Ksh 338 million for the offenders.
The decision, which also netted billionaire Narendra Raval of Devki Steel, was arrived at after a two year long investigation that saw the competition watchdog probe the nine firms.
In June 2022, the CAK raided the premises of the still firms on suspicion of price-fixing, which is against the competition laws.
“In execution of this role, the Authority has pursuant to an investigation, penalised nine steel manufacturers a total of Ksh 338 million.
The companies engaged in cartel conduct whose effect was to increase the cost of construction of homes and infrastructure by artificially inflating the prices of steel products,” said CAK.
CAK said, steel products such as bars, pipes, beams, and sheets, account for over 20 percent of the total cost of constructing a house, with destortion in pricing having a negative impact on consumers.
Other firms penalised include l Nail and Steel Products Limited, Brollo Kenya Limited, Blue Nile Wire Products Limited, Tononoka Rolling Mills Limited, Doshi & Hardware Limited, Corrugated Steel Limited, Jumbo Steel Mills, and Accurate Steel Mills Limited.
Further, the said firms, with the exception of Accurate Steel Mills, have been penalised for output restriction by agreeing to limit imports of certain steel components, thereby causing an artificial shortage that raised prices.
Price fixing and output restriction are illegal under the Competition Act as they hinder competition in markets.