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Thursday , December 1 2022

Several money exchange companies summoned for interrogation

This post has been read 51794 times!

KUWAIT CITY, June 27: The Competition Protection Authority (CPA) has summoned for interrogation a number of exchange companies, against the background of allegations that they have concluded a collective agreement to unify the prices of remittances according to rates agreed upon daily, and this includes the exchange rate margin of their converted currencies, reports Al-Rai daily. Reliable sources from the authority said it constitutes a violation of the provisions of the device law.

In the event that the accusations against them are proven, these companies will face penalties in accordance with the “Competition Protection” law, starting with a warning, and up to a fine of 10 percent of their profits achieved 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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