Kenya Tea Development Agency (KTDA) directors are digging in for a drawn-out legal battle after they accused the State of hatching a plot to compulsorily acquire a private business.
Through lawyer Benson Millimo, the directors said KTDA was a private company owned by farmers (as opposed to a parastatal), "and the only way that the government can own it by buying it from growers".
“If the government is interested in taking over the business of KTDA… it should negotiate with the farmers. But just coming in to frustrate a private business is not allowed whatsoever in law,” said Mr Millimo.
Last month, Agriculture Secretary Peter Munya unveiled proposed Crops (Tea Industry) Regulations 2020 which critics claim will weaken KTDA’s control of the 69 factories currently under its fold.
Among other proposals, the rules require that all earnings from the sale of tea at the auction be remitted directly to KTDA factories as opposed to the current practice where all such returns are held centrally in the agency’s account.
Mr Munya has also moved to scrap KTDA’s role in direct tea sale to the overseas market.
The agency, through its subsidiary, Chai Trading Limited Company, has been selling a portion of its tea directly to international buyers at an agreed price.
According to Mr Millimo, the proposed regulations will infringe on the constitutional right to own property. He challenged the Government to follow the right procedures “if it has interest in owning the property held by tea farmers”.
“Both the Constitution and the laws of this country protect property. The duty of government is to protect property. If the Government is interested, in any other way, to have or acquire a property, then there are procedures through which it can do so,” he said.
Mr Millimo said the regulations go against the spirit and letter of the Kenya constitution and will significantly reduce tea farmers’ earnings, thereby achieving the opposite result of their intended objective.