The East African Community (EAC) Vision 2050 notes the importance of enhancing the region’s competitiveness, particularly in the fertilizer and agrochemical industries. These areas are critical for growth in the Community, leveraging existing capabilities and resource endowments to promote food security. Further, the EAC Industrialization Policy 2012-2032 identifies six (6) priority sectors in which the EAC region has a comparative advantage. Strategic interventions have, therefore, been proposed to support the competitive development of the priority sectors, which include fertilizers and agrochemicals. The East African Community Competition Authority has therefore prioritized to conduct market screening of the fertilizer sector within the Community. Fertilizer as a key input in agriculture and essential for food security in the Community is applied by farmers to help them to increase crop yields, improve plant health and restore soil health. Fertilizer prices across the region increased along with international prices in late 2021, however, they have not reduced in line with the prices in international markets. The high prices are detrimental to the farmers, and to governments which have chosen to subsidize fertilizer prices. Furthermore, there are high levels of market concentration, behavioural practices and high barriers to entry, among others. Thus, it necessitates competition assessment of this market in the EAC region, specifically in Kenya, Tanzania, Uganda, Rwanda, Burundi and Democratic Republic of Congo. Therefore, pursuant to the provisions of section 18 (5) of the Competition Act, Cap 504 laws of Kenya (“the Act”) and in the exercise of the powers conferred by section 18 (1) (a) of the Act, and sections 5, 42 (1) (a), 42 (1) (k) and section 43 of the East African Community Competition Act, 2006, the Competition Authority of Kenya in support of the East Africa Community Competition Authority intends to carry out a market inquiry into the fertilizer markets in Kenya. The overall objective of the market inquiry is to assess the state of competition in the fertilizer sector within the East African Community. The specific objectives are to— (a) determine fertilizers trading patterns including relevant product and geographic markets, in terms of imports, ports of entry, distribution and supply to and within EAC; (b) examine the market structure and market concentration level regarding undertakings engaged in the supply and demand of fertilizers, including importation /blending/manufacturing and distribution/supply of fertilizer within the EAC; (c) analyze the cost components and price patterns of fertilizer over five years in the industry value chain (between manufacturers, importers, distributors and suppliers); (d) establish barriers to entry and exit and other trade barriers in the fertilizer industry value chain within the EAC; and (e) establish if there are anti-competitive practices in the industry value chain of the fertilizer sector and take appropriate action as per the Act and the East African Community Competition Act including providing relevant policy recommendations for pro-competitive reforms. In conducting the study, the Competition Authority of Kenya in collaboration with the East African Community Authority shall— (a) send requests of information as it deems relevant to all institutions and undertakings involved in the industry value chain who may contribute to the scope of this industry sector inquiry; (b) hold such number of meetings and Key Informant Interviews (KIIs) in such places at such times as it may consider necessary for the proper discharge of its functions; and (c) receive views from all stakeholders through oral and/or written submissions from any person with relevant information. Members of the public with relevant information may also submit oral or written submissions to the Secretariat within twenty-one (21) days of publication of this notice. The secretariat of the study shall be based at the Authority’s offices located at CBK Pension Towers,15th Floor Harambee Avenue. P.O. Box 36265–00200 Nairobi, Tel. +254-20-2628233. Submissions may be made through the email address info@cak.go.ke or the CAK portal https://competition.cak.go.ke:444 under the “Submissions” Tab.
Dated the 18th December, 2024.
MR/6520714
DAVID KEMEI, Director-General.
