CAK gives suppliers more time to report delayed payments

The Competition Authority of Kenya (CAK) has extended the time for receiving information on late payments by suppliers and manufacturers to facilitate determination of penal action against retailers.

The initial deadline was to expire on May 14 but no new date has been set.

Speaking when he hosted Kenya Association of Manufacturers (KAM) top officials in Nairobi, director-general Wang’ombe Kariuki said CAK would also look at new supplier-retailer agreements extending payment timelines beyond the 60–day cap for payments.

“Retailers and suppliers must submit information on outstanding payments by supermarkets or any extended payment periods to facilitate further action,” he said.

The two parties met last week and discussed matters concerning competition compliance and measures to address late payments.

KAM vice-chairman Mucai Kunyiha said increasing late payments in the sector were worrying and pushed for policies to ensure smooth cash flows for manufacturers.

The meeting comes hardly months after Choppies closed its Kenyan operations amid mounting supplier debts by its 15 stores. CAK’s move to extend late payment reporting period that lapsed mid-last month could have been informed by an unwillingness by suppliers, especially small and medium manufacturers, to report retailers who offer them a one-stop regional market for fear of being victimised.

An interim CAK report revealed late payments were largely due to the impact of Covid-19 on the retail sector.