SGR Cargo Directives Case

A challenge to the government requirement that all Mombasa Port cargo be transported by SGR | Constitutional Petition No. 159 of 2018 Consolidated With Constitutional Petition No. 201 of 2019 | Civil Appeal No. E.12 of 2021
Case filed: May 2018Current status: Government has appealed

Petitioners

  • William Odhiambo Ramogi
  • Asha Mashaka Omar
  • Gerald Lewa Kiti
  • Kenya Transporters Association Limited

Respondents/
Appellants

  • The Attorney General
  • The Cabinet Secretary, Ministry Of Transport And
  • Infrastracture
  • Kenya Ports Authority
  • Kenya Railways Corporation
  • Competition Authority Of Kenya

Interested Parties

  • Muslims For Human Rights
  • Maina Kiai
  • County Government Of Mombasa

Current status

Updated 26 Sep 2022

After President William Ruto ordered the return of port services to Mombasa following his inauguration, Kenya Ports Authority issued a notice advising shipping lines and agents that:

1/ Cargo importers may choose their mode of transport, meaning that the SGR cargo directives would no longer be enforced.

2/ Cargo importers can choose their point of clearance, meaning they are no longer requiring clearance to take place at the inland container depots in Nairobi or Naivasha.

Okoa Mombasa interprets this notice to mean that the so-called SGR cargo directives – which were declared unconstitutional in this court case – have now been rescinded. See our full statement here

With the directives revoked, we call on the government to withdraw its appeal immediately. Alternatively, the Court of Appeal should dismiss the case as moot. 

Previous status updates

25 Nov 2021: Court of Appeal grants government's motion to delay implementation of judgment

On 25 Nov 2021, the Court of Appeal GRANTED the government’s February 2021 motion to further stay (delay) the High Court’s November 2020 judgment nullifying the SGR cargo directives.

The ruling means that the SGR cargo directives remain in effect. The High Court’s ruling declaring the directives illegal will not be implemented until the full appeal is heard. The ruling allows KPA to continue its anti-competitive practice of forcing importers to use the SGR to transport goods arriving at the Port of Mombasa. Importers cannot choose any other means of transport.

6 Nov 2020: Judgment issued by High Court

Allegations that the cargo directives violated the Petitioners’ socio-economic rights were not proved and were therefore dismissed.

The claim that the Take-or-Pay Agreement was in violation of the Constitution was dismissed.

The claim that the cargo directives were in violation of the Constitution for lack of public participation and non-compliance with fair administrative procedures succeeded and the directives were quashed.

The order quashing the directives was suspended for one hundered and eighty (180) days to allow the Respondents to regularize the situation. See here for full judgment.

30 Nov 2020: KPA applies to stay orders

On 30 Nov 2020, KPA applied for a stay of orders quashing the cargo directives found in violation of the Constitution and the suspension of the order.

5 Feb 2021: Court rules on KPA's application to stay orders

The High Court ruled that the Applicant had sufficient time to either comply with the judgment or appeal against the judgment.

Further, that the Court of Appeal was best placed to determine its own docket and timelines and therefore was the appropriate venue to seek further extension or variance of the stay orders. The application was dismissed with costs. See here for the ruling.

18 Feb 2021: Motion to certify urgent appeal

KPA filed a motion with the Court of Appeal to certify its appeal as urgent. If granted, the appeal could be heard before the lower court’s 180-day stay expires. Read the motion and certificate in support of urgency here

10 May 2021: Court's orders delayed

The 180-day deadline expired on 7 May, but the high court granted a last-minute stay for the appeals court to decide on May 10 whether to expedite KPA’s appeal.

Unfortunately, the appeals court hearing on 10 May was canceled at the last minute for unclear reasons. On 31 May 2021, the High Court again stayed implementation of their order suspending the SGR cargo directive until the next hearing.

22 June 2021: Court's orders delayed again

The High Court granted KPA an interim order allowing it to continue enforcing the SGR cargo directives until 30 September 2021, when it will rule on the authority’s application of stay.

30 Sept 2021: Court's orders delayed a third time

The High Court dismissed Kenya Ports Authority’s application to stay enforcement of the court’s Nov. 2020 judgment ruling that the SGR cargo directives were illegal. 

However, the Court also issued an interim order staying its decision until 10 Nov 2021. During that time, the SGR cargo directives will stay in effect. Moreover, we expect that the Court of Appeal will rule on the case before 10 Nov. 2021, either upholding over overturning the High Court’s 2020 judgment. If it doesn’t, the High Court’s judgment would take effect on 10 Nov 2021. See here for the ruling.

11 Nov 2021: The High Court's stay expires

The latest stay, issued on 30 Sept 2021, expired on 10 Nov 2021. Therefore, the original court ruling technically took effect and the SGR cargo directives are null and void as of 11 Nov 2021.

Under this court ruling and Kenyan law, importers are now free to choose their method transport. We notified KPA as such via a letter sent on 11 Nov 2021. However, it appears KPA was not obeying the court orders in anticipation of a ruling from the Court of Appeal. 

Summary of facts & issues

Petition 159 of 2018 challenged a clause in an agreement between the 3rd respondent (Kenya Ports Authority) and the 4th respondent (Kenya Railways Corporation). The clause obligated the 3rd respondent to consign to the 4th respondent, as a carrier, a set volume of freight and other cargo pursuant to the commencement of the operations of the Standard Gauge Railway (SGR) to the 3rd respondent’s Inland Container Depot (ICD) at Embakasi. The 1st to 3rd petitioner alleged that the clause violated various constitutional provisions including fundamental rights and freedoms. In general, they complained that the clause threatened the socio-economic rights of the petitioners and residents of Mombasa County under article 43 of the Constitution.

Mombasa High Court petition No. 201 of 2019 challenged two directives issued by the 3rd respondent (Kenya Ports Authority) and directed at members of the 4th petitioner (Kenya Transporters Association Limited) and they were about the consignment of cargo and the location of the clearance depot for cargo arriving at the port of Mombasa. The first directive, issued on March 15, 2019, notified the general public that from the date of the directive, shipping lines would not be allowed to endorse a Bill of Lading to importers’ Container Freight Station (CFS) of choice. The second directive, issued on August 3, 2019, stated that all imported cargo for delivery to Nairobi and the hinterland would be conveyed by SGR and cleared at the ICD – Nairobi. It was argued by the petitioners that the directives supported monopolistic tendencies with regard to the transport of containers from the port of Mombasa to other destinations. The 4th petitioner said that it went contrary to the Competition Act and the Consumer Protection Act. The 4th petitioner added that importers of cargo had a right to choose the mode of transportation for their cargo from the port of Mombasa to a destination of their choice. They said that the directives violated the socio-economic rights of the residents of Mombasa and Kenya in general.

Mombasa High Court petition No 159 of 2018 and Mombasa High Court Petition No 201 of 2019 were consolidated.

Prayers and Okoa Mombasa objectives

Responds to Okoa Mombasa’s goal of strengthening local participation over decisions affecting local resource by:

  • Demonstrating the unconstitutionality of decision-making that does not involve public participation particularly of those most affected by the decisions;
  • Strengthening devolution by asserting county (residents and government) control and ownership over county resources and resources within the county;
  • Enforcing government obligations in protecting, promoting and fulfilling socio-economic rights.
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