Competition Authority of Kenya raises red flag on bread makers issuing misleading information to consumers

KENYA – Bread manufacturers in Kenya are on the radar of the Competition Authority of Kenya, after the authority found that some bakers are not meeting the provisions of the Competitions Act and other relevant standards.

In pursuant to its consumer protection mandate, CAK undertook investigations targeting bread manufacturers in the country.

In a statement containing findings from the investigations, the competition regulator has established unfair and misleading market conduct by some actors.

CAK revealed that some of the bakers were not providing the manufacturing date/month on their bread wrappers in the prescribed format, while others were printing them illegibly on the seals.

In other cases, the manufacturers omitted the applicable month in the expiry dates.

The authority’s investigators also found out that the manufacturers failed to provide the weight of their bread products and ingredients, while others marketed their bread as fortified but did not specify the alleged nutrients/vitamins used.

Others have misled consumers that their products contained milk or butter whereas they did not.

“Manufacturers have no latitude to elect which laws to adhere to.”

Mr. Wang’ombe Kariuki – CAK Director-General

“These actions amount to making false and misleading representations to consumers of goods and services and are in contravention of sections of the Competition Act. Further, the bread manufacturers, were not adhering to product information standards as prescribed by the Kenya Bureau of Standards (KEBS),” CAK said in a statement.

Mr. Wang’ombe Kariuki, the Authority’s Director-General, further noted that, “Manufacturers have no latitude to elect which laws to adhere to.”

To this end, the bread manufacturers have been asked to take remedial measures including compliance with requirements such as providing a list of ingredients and the net weight of products in grams.

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Further, the manufacturers are required to legibly print the day and month the product was manufactured on the wrapper and correctly indicate the expiry date of the bread by adjusting the information on the wrappers to ‘Best Before’ instead of ‘Sell By’.

Additionally, manufacturers must clearly specify the vitamins and minerals used in the fortification of their bread.

Whereas no harm to consumers has been recorded due to the aforementioned contraventions, Mr. Kariuki has indicated that consumers have absolute rights to full and accurate information about goods or services offered in the markets.

The CAK will continuously undertake spot-checks to establish compliance with all the directives.

Meanwhile, bakers have criticised the government’s move to introduce value-added tax (VAT) on bread and its products.

The Bakers Association of Kenya (Bake) says the tax is disruptive, considering the economic downturn the sector has suffered since the start of the Covid-19 pandemic last year. It argues that introducing the tax will deny majority of Kenyans access to quality food.

“The introduction of 16 per cent VAT on this commodity will further increase the average price of a 400g loaf of bread by approximately Ksh8 (US$0.74), making it unaffordable to the majority of Kenyans,” said Bake in a letter to the National Treasury.“This will be in violation of the fundamental right to affordable food.”

The planned tax comes a few months after manufacturers increased the price of bread by Ksh5 (US$0.046) following a jump in global wheat prices.

The price of bread has remained stable over the years due to zero-rating on tax, with manufacturers competing for the small margins buoyed by economies of scale.

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