Reprieve for foreign logistics firms after rules nullified

Foreign-owned logistics firms have won a reprieve after the High Court struck out rules that had sought to scrap their trading licences.

Justice Edward Muriithi nullified the restrictive rules, saying the Merchant Shipping Regulations published under Legal Notice No 112 of 2011 were crafted without statutory authority, rendering them unconstitutional.

The contentious regulations restrict provision of maritime services to citizens or firms in which not less than 51 per cent of the share capital is held directly by Kenyans.

This means foreign firms that dominate the segment would not have had their licences renewed upon expiry. At least 20 logistics firms had moved to court arguing that the rule was discriminatory and unconstitutional.

The group sued the Attorney General, Transport ministry and the Kenya Maritime Authority after former minister Amos Kimunya published the regulations in 2011.

On Wednesday, Justice Muriithi issued orders declaring the regulations as “generally inconsistent with the Constitution and void to the extent of their inconsistency.”

“The regulations are wholly unconstitutional and ultra vires, the Constitution renders them invalid for want of specific expression of intent, nature and extent of limitation of affected rights,” said Justice Muriithi.

He added that changes sought in the regulations implied negative impact on the rights and fundamental freedoms of the petitioners and asked Parliament to effect necessary changes in the law.

Justice Muriithi said the court regarded the matter as a serious issue that warranted a careful deliberation by Parliament.