Stakeholders urge Finance Committee to enhance clarity of competition bill provisions, say overregulation could stiffle innovation

Stakeholders have urged the National Assembly to consider enhanced regulatory precision, evidence-based policy, and inter-agency coordination across Kenya’s evolving commercial and financial sectors as it considers the Competition (Amendment) Bill, 2026.
Laws firms Bowmans (Coulson Harney LLP) and Anjarwalla & Khanna (ALN Kenya) made the appeal when they submitted memoranda to Departmental Committee on Finance and National Planning on the Bill.
The two urged the lawmakers to exercise caution, refine legal definitions, and maintain regulatory balance while processing the reform legislation. 
They told the Committee that these submissions highlighted critical concerns regarding potential overregulation, institutional overlaps, and the economic impact on Kenya's developing digital and financial markets with the Bill’s enactment. 
The Competition (Amendment) Bill, 2026 seeks to modernize Kenya's legal framework for market competition, particularly in response to expanding digital economies and evolving supply chain dynamics. 
Among its key provisions, the Bill introduces statutory definitions for digital activities, digital markets, multi-homing, and strategic market position (SMP). 
It seeks to creates an expanded framework governing the Abuse of Superior Bargaining Power (ASBP) and broaden protections for business consumers against unconscionable conduct in commercial transactions. 
Further, the proposed legislation seeks to empower the Competition Authority of Kenya (CAK) to impose conduct requirements and administrative penalties, up to ten percent of annual turnover, on designated firms that hold market power or control strategic positions, even where traditional market dominance is not established.
In its submission on Bill, Bowmans (Coulson Harney LLP) expressed significant concern that the proposed amendments introduce broad, vague, and overlapping legal standards without a demonstrated market failure or a cost-benefit analysis.
They cautioned against broad legislative intervention in nascent markets without a demonstrated market failure or a comprehensive Regulatory Impact Assessment (RIA). 
The firm warned that introducing broad ex-ante obligations on digital platforms risks stifling innovation, discouraging foreign direct investment, and placing heavy compliance burdens on small and medium-sized enterprises (SMEs).
"The Authority's jurisdiction is not, and should not be construed as, a general power to regulate or interfere with commercial arrangements between private parties”, Bowmans noted highlighting the fundamental role of competition enforcement,
Addressing the broader statutory framework introduced by the proposed legislation, Bowmans added.
"The Amendment Bill, however, represents a significant and potentially harmful departure from these principles. It introduces broad, vague, and overlapping concepts without clearly defined thresholds, and risks expanding competition law beyond its proper function."
The firm emphasized that the absence of structured evidence could negatively alter Kenya’s position as a regional technology hub:
"In the absence of a clearly defined problem, a demonstrated legislative gap, and a rigorous cost-benefit analysis, there is a material risk that the proposed amendments will impose disproportionate compliance burdens, create regulatory uncertainty, and result in overreach”, they submitted. 
On the other hand, ALN Kenya called for inter-agency coordination and regulatory clarity. They underscored the importance of clear jurisdictional lines to prevent regulatory duplication between the Central Bank of Kenya (CBK) and the Competition Authority of Kenya (CAK).
ALN also sought to emphasizing their commitment to statutory development in Kenya.
"ALN Kenya has a policy to contribute to the development of legislation in Kenya and to encourage the strengthening of the rule of law in the country."
They further highlighted the need for seamless coordination between regulatory bodies, particularly regarding consumer protection and market amalgamations, ALN Kenya. 
"Financial-sector complaints often overlap CBK and CAK jurisdiction, hence including CAK would strengthen coordination, avoid duplication, and align with CBK’s consumer-protection framework."
Both law firms urged the Committee to adopt evidence-based, proportionate statutory frameworks that support market confidence and consumer protection while fostering economic growth and entrepreneurship in Kenya.
Reacting to the submissions, the Committee Members acknowledged the need to balance the the strengthened Competition Authority of Kenya’s (CAK) powers to execute its mandate, while pushing back provisions that could cripple innovation. 
“This law is very important and will have far reaching implications on how firms run businesses in the country. I am in agreement that as we consider this Bill, we need to balance between giving CAK regulatory powers, but at the same time, not cripple innovation”, he stated.
Hon. Kimani further acknowledged the need for the Committee to scrutinize the provisions of the Bill against the proposed amendments, to ensure that the enacted law does not lead to unnecessary litigation. 
“Hon. Members, this is a Bill we need to be careful on, because it could also lead to very many unnecessary court cases”, Committee Chairperson Hon. Kuria Kimani noted. 
Weighing into the matter, Committee Member Hon. Julius Rutto asked the law firms to make alternative proposals on how CMA can be supported through law to effectively carry out its mandate, in the event that the Committee was to adopt their proposed amendments. 
“My concern is that this is an agency mandated to look at the business environment to ensure that there is a fair balance on how businesses are run. We need to give them them teeth enough to bite. How do you think we should be able to support this agency?”, he asked
His sentiments were supported by Homa Bay Town lawmaker Hon. Peter Kaluma.
“This amendment Bill is very critical. The heart of the Bill is Part 3A on unfair markets. While the provisions of the Bill seek to curtail the abuse of superior bargaining positions, your submission suggests that you intend to safeguard the same position”,he noted.
“I wanted you to retract your proposal on the removal of penalties. I thought you would propose a non-custodial penalty. Could I pick your thoughts and the overall projected impact on the same?”, he asked.
While thanking the law firms for well researched submissions, Hon. Kimani undertook that the Committee would keenly look at their submissions before making proposals to the House on the Bill.