Heineken to pay Maxam Ksh.1.7B in damages after terminating distributor contract

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Heineken East Africa has been ordered to pay its former distributor Maxam Limited Ksh. 1.7 billion by the High Court in Nairobi.

In his ruling Justice James Makau, said that Heineken liable to compensate Maxam Limited for its breach of the clause No. 26 of their contract. He further added that the alcohol manufacturer should pay Ksh. 1,799,978,868 as special damages for loss of business after Heineken terminated Maxam’s distribution agreement.

The company, which trades as Heineken East Africa Import Co Ltd in east Africa, was sued by Maxam Limited and two other distributors. The two other distributors are Uganda’s Modern Lane Ltd and Tanzania’s Olepasu Ltd. The three companies sued Heineken after it terminated their contracts.

According to Heineken however, the termination of the contracts was aimed at deleting the exclusivity clause in the current contracts. This was geared towards opening up the distribution of its products across the region to more firms that were willing to partner with it. The three companies contested this and Heineken added that the three were free to apply for new distribution deals.

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