Kenyan regulator CCK to clamp down on sales promotions and special offers and control tariffs

Telecoms

The Kenyan regulator CCK is bringing in strict regulations that target sales promotions, special offers and other sales gimmicks, which have become integral parts of the aggressive tactics the companies use to attract new customers and retain loyalty. The moment the new rules take effect, all promotions and special offer campaigns will only be allowed to run for a maximum of 90 days.

Under the proposed regime, companies must file all details of promotions or special offers with the CCK within 14 days before the campaign starts. Special offers and promotions will only run after approval by the CCK. Even more controversial are proposals to monitor and control tariffs. The rules stipulate that all tariffs charged by mobile phone companies will have to be approved by the CCK.

There is also a proposal to introduce what is known as price caps. Any mobile company with a dominant market share will have to observe an upper limit tariff set by the regulator. Furthermore, tariff increases will be pegged to movement of the consumer price index.

The proposed regulations have been circulated to the stakeholders and are still subject to discussion and consultation. In a conversation with the Saturday Nation, the chief executive of Safaricom, Michael Joseph, described the proposed regulations as "draconian" and "anti-business", arguing that publication of the proposed rules had introduced regulatory uncertainty in the industry. Zain also objected to some of the new rules the moment the draft regulations were circulated a fortnight ago.

Daily Nation