Royal Mabati to pay Ksh.2.7M fine for misleading customers as appeal dismissed

Roofing material manufacturer Royal Mabati has lost an appeal against a decision to pay a Ksh.2,652,363 fine for misleading customers.

In a ruling issued last week, the Competition Tribunal upheld a decision by the Competition Authority of Kenya (CAK) to fine the manufacturer for documented customer complaints.

The complaints cover failure and delays to deliver purchased products within agreed timelines, and request for customers to pay for deliveries despite adverts on free deliveries by the company.

Additionally, customers have complained about requests to change order specifications after payments.

Royal Mabati had appealed a determination by CAK in May 2020 which found that the roofing material manufacturer had misled its customers.

“The authority is of the opinion that this ruling will deter suppliers of goods and services from engaging in conduct that misrepresents the terms of a transaction to consumers and encourage implementation of robust and fair complaints address mechanism,” CAK said in a statement on Tuesday.

CAK had between March 2018 and March 2020 received 13 complaints from customers of Royal Mabati.

In addition to the financial penalty, the manufacturer will be required to refund customers with outstanding complaints within 60 days from the determination date or deliver the roofing materials to preferred premises within 30 days at no cost.

Further, Royal Mabati has been asked to refrain from running false or misleading advertisements and to sensitize its customer care team about provisions of the Competition Act.