Kenya attacks Google and Amazon with new antitrust law

The Competition Authority of Kenya (CAK) has proposed changes to the Competition Act, signaling a tougher stance against Big Tech as the government takes action to protect local companies from anti-competitive behavior. Anticompetitive behavior includes companies making mergers and acquisitions to kill competition, limiting third-party services on their platforms, and limiting customer options by combining only core and complementary products.

Let’s assume that the proposed changes to the Competition Act have entered into force. In this case, CAK will have power over fair market practices and the protection of consumer rights in a digital and technological space currently dominated by a few foreign giants.

The new law will give the competition watchdog the power to launch antitrust investigations, if it deems it necessary, against technology companies such as Google, Amazon, X and Apple, mirroring similar industry cases in the United States and Europe.

“The Competition Act (hereinafter referred to as the ‘Fundamental Act’) is amended in section 2 by adding “digital activity” means the provision of services via the Internet or the provision of digital content to entrepreneurs or other consumers (paid or not and regardless of whether such activity is multilateral),’ we read in the amendment.

The agency gave interested parties until June 11, 2024 to submit their views on the draft rules.

The proposed law distinguishes eight sectors, including online intermediation services, online marketplaces and application stores, online search engines, online social networking services and video-sharing platform services.

Others are standalone operating systems that provide interpersonal communication services, cloud computing services, and online advertising services.

CAK will conduct compliance audits of foreign technology companies to determine whether their activities have exposed competitors to unfair competition. The new law will enable the agency to use issues raised in other markets to make decisions.

“This change has been necessitated by the fact that in the digital market there are companies whose market shares are below the dominance threshold, but whose behavior has the same negative impact on competition as the dominant players. The envisaged enforcement procedure is the same as that set out in applicable law. The proposed changes also introduce criteria for determining strategic market position,” CAK reported.

While the European Union (EU), the United Kingdom and the United States have taken enforcement action against technology companies, African countries have fallen by the wayside without strong antitrust laws and competition institutions. Facebook’s Meta, Apple and Google companies faced anti-competitive scrutiny in Europe that resulted in multi-million-dollar fines paid to competition regulators.