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Saturday, June 3, 2023

Online food delivery platforms in Kenya under probe

The competition regulator in Kenya is probing the conduct of online food delivery and groceries platforms to inform its suggestions on regulatory and policy options, to bolster healthy competition, and enforcement of consumer protection.

The Competition Authority of Kenya (CAK) said the market inquiry will help it understand amongst other issues the “role of data” in their operations, data portability, how they acquire customers, consumer protection issues, and give it a purview of redress mechanisms used by the marketplaces. It also plans to use the inquiry to review if the existing regulatory framework can be applied in digital markets.

Enforcement in digital markets is one of the key areas of focus by CAK. It has in the past conducted similar investigations, recent one being in the digital lending space where it made suggestions (including on pricing transparency) that informed some aspects of the new Digital Credit Providers law.

“The market inquiry will seek to uncover how food delivery and groceries platforms work in practice and suggest regulatory and policy options for competition and consumer protection enforcement,” said CAK acting director general, Adano Wario.

“The inquiry will identify players and services involved in the food delivery and groceries platforms business model in Kenya and examine the relationships between the platforms and the users with focus on the competition parameters (market power and conduct) and concerns amongst the players,” said Wario.

The regulator said by understanding consumer protection concerns, it will be better placed to provide redress mechanisms for consumers shopping through the marketplaces.

There are a number of major online food delivery and groceries platforms in Kenya including Uber, Jumia, Bolt, Glovo, that have gained foothold in the country as internet and smartphone penetration grows, coupled by the uptake of services such as online shopping and deliveries.

The market inquiry follows the recent coming together of several competition watchdogs in Africa, including CAK, to collectively interrogate the market conduct of global digital firms over concerns related to competition and consumer welfare in Africa.

Members, that also include Egypt, Mauritius, Nigeria, South Africa, Morocco, Gambia and Zambia, aim at ensuring efficient enforcement of competition law and policy in digital markets guaranteeing a competitive market, and fostering the growth of African digital firms.

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