SEVERAL MONEY EXCHANGE COMPANIES WERE SUMMONED FOR QUESTIONING

  • 28/06/2022

Kuwait City: The Competition Protection Authority (CPA) has summoned a number of exchange companies for questioning in connection with allegations that they have entered into a collective agreement to unify the prices of remittances based on daily agreed-upon rates, which includes the exchange rate margin of their converted currencies. According to reliable authority sources, it violates the provisions of the device law. 


If the claims against them are verified, these companies will face penalties under the "Competition Protection" statute, beginning with a warning and up to a punishment of 10% of their earnings earned throughout the implementation period of their agreement. It is reported, according to the open investigation in this regard, that 12 exchange companies have resorted, since the start of the repercussions of the corona pandemic, to regulate competition between them, with an amicable understanding contract that requires the implementation of their transfers at a unified price, and this includes the exchange rate of currencies transferred in their operations, with the aim of getting rid of unhealthy competition, which sometimes reached offering prices devour returns. 

This agreement obligates all its members to set the price on a daily basis, without allowing any reduction in value, regardless of the weight of the customer, the size of his transfers and his history with the company. Sources close to the exchange companies pointed out that their understanding in this regard does not contradict the “Competition Protection” law for more than one reason, noting that the two ‘mutualists’ are 12 companies, while there are about 200 companies and exchange institutions that did not participate in this agreement, as they decided to work alone by determining its profit margin from remittances, and while doing so, it provided lower price levels than those traded with counter-party companies. She stated that about 35 companies are working in the local exchange market, subject to the supervision of the Central Bank of Kuwait, not all of them agreed on this understanding, which shows that the agreement is not binding.

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