Legal Expert Warns Parliament Against Rushing Imported Digital Competition Rules

A competition law expert has cautioned Parliament against adopting sweeping digital market rules modelled on foreign frameworks without first establishing clear evidence of failure in Kenya’s tech ecosystem. Dr Vellah Kedogo Kigwiru, a research fellow at the Technical University of Munich, made the submission to the National Assembly’s Departmental Committee on Finance and National Planning.

She warned that early and excessive intervention could harm competition, investment and innovation. Kenya’s digital markets have already delivered significant benefits. Local startups and small enterprises rely heavily on existing digital infrastructure. Over-regulation at this stage risks undermining those gains.

The proposed Competition (Amendment) Bill 2026 seeks to expand the mandate of the Competition Authority of Kenya. It would give the agency new tools to address anti-competitive conduct in digital markets and abuse of superior bargaining position. The Competition Authority has argued that the current Act does not adequately cover platforms that derive power from network effects, data control and integrated ecosystems.

Dr Kigwiru stressed that Parliament and the authority must first demonstrate that the existing 2010 Competition Act is insufficient. She noted that the Competition Authority has yet to publish a comprehensive digital market inquiry that would justify the legislative shift. Without such evidence, the amendments rest on assumptions rather than proven local problems.

Other emerging economies have taken a more cautious path. India, South Korea and Brazil recently paused or abandoned similar digital competition bills after pushback from local businesses and concerns about stunting growth. Kenya, she argued, should learn from those experiences rather than import ready-made solutions.

The Bill introduces the concept of a strategic market position. This would allow regulators to intervene even where a firm holds less than 40 percent market share if it can influence prices, quality or innovation. Factors such as network effects, data control and switching costs would be considered. Critics say the lower threshold and new powers risk creating uncertainty for platforms and investors.

Ride-hailing, e-commerce and other digital services have become central to Kenya’s economy. Drivers, merchants and consumers depend on these platforms. Balanced rules can protect smaller players and maintain fair terms. Poorly designed rules, however, can raise compliance costs, slow product development and discourage new entrants.

The expert’s intervention comes as the Competition Authority continues to seek expanded powers. Director General David Kemei has told the same committee that digital platforms present unique challenges not fully addressed by traditional dominance tests. The authority wants tools to tackle gatekeeper behaviour and unfair trading practices.

Lawmakers now face the task of weighing these competing arguments. Evidence-based market studies, clear definitions and phased implementation could reduce the risk of unintended consequences. Rushing legislation without that foundation, the expert warned, may ultimately dampen the very innovation Kenya seeks to promote.