'Buyer Power' as an Emerging Concern in the Kenyan Economy: A Competition Law Perspective
4th Annual Competition Authority of Kenya Essay Writing Competition 2017 Series
11 Pages Posted: 2 Apr 2017
Date Written: February 15, 2017
In December 2016, Kenya became the first country in Africa to adopt specific legislative provisions on buyer power through the competition law framework. According to Competition Authority of Kenya, abuse of buyer power is an emerging issue of concern in the Kenyan economy particularly in the retail sector because of the failure of buyers to honour their contractual obligations with their suppliers.
In this connection, this Essay seeks to answer two interrelated questions. Firstly, how does Kenyan competition law treat a market structure where there is a small number of big buyers and a large number of suppliers characterised by superior bargaining power of the large buyers, where the latter fall below the threshold for dominance? Secondly, what remedies exist under Kenyan competition law to control abuse of buyer power?
Keywords: buyer power, monopsony power, bargaining power, abuse of superior bargaining position, competition, consumer welfare, waterbed effect, Africa, retail sector, supermarkets, dominance, Kenya, South Africa, Australia, United Kingdom, United States, Competition Amendment Act, 2016
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