Parties opposed to port privatisation reaches agreement with government
The Port of Mombasa on March 28, 2023.
What you need to know:
- Consent agreement adopted as an order of the court by three-judge bench of the High Court.
- Parties agreed to set aside interim conservatory orders which had halted the process.
Government plans to privatise some berths at Mombasa and Lamu ports can now proceed after parties in a petition challenging the privatisation entered into a consent agreement.
The consent will see Kenya Ports Authority (KPA) comply with the Constitution and Public Private Partnership laws to ensure public participation, value for money, increased efficiency in service delivery, inclusivity and local content in the projects.
The consent agreement was signed by lawyers representing the Taireni Association of Mijikenda which was challenging the privatisation, KPA, Cabinet Secretaries for Finance and National Treasury, Transport and Infrastructure and the Attorney General.
The consent, which has been adopted as an order of the court by a three-judge bench of the High Court, will also see KPA ensure the involvement of stakeholders throughout the process in terms of creating awareness to the project.
The three-judge bench comprising Justices Olga Sewe, Gregory Mutai and Florence Macharia also marked the case file as closed.
“The petition dated November 27 2023 be and is hereby determined as per the terms 1, 2 and 3 (of the consent) with no orders as to costs,” part of the consent states.
Parties also agreed to set aside interim conservatory orders which had temporarily halted the privatisation and an application by the petitioner seeking the interim conservatory orders.
Also agreed to be withdrawn is KPA’s application seeking to have the interim orders set aside.
Taireni Association of Mijikenda had challenged the planned privatisation of Lamu Container Terminal Berths 1-3, Lamu Special Economic Zone, Mombasa Ports Berths 11-14 and Mombasa Port Container Terminal 1.
The association had sought a declaration that berths 1-3 at the port of Lamu,11-14 at the port of Mombasa and container terminal 1 at the port of Mombasa contained in the Tender No KPA/052/2023-2024/CPS are public assets and not projects hence cannot be disposed of according to the Public Private Partnership Act, 2022.
The association argued that processes, which have been adopted by the government and leading to the purported leasing, concession or public private partnership on the public assets held by KPA, were both unlawful and unconstitutional.
“The respondents commenced the process of tender bids and invitation of qualifications for assets of KPA by a tender dated October 17 in disregard to express provisions of the law. The berths and container terminal one are fully developed and operational," part of the petition stated.
According to the petitioner, the berths and container terminals are public assets developed from public funds and the same being donated to private investors to operate.
It further said public assets are not projects, arguing that projects are undeveloped economic zones.
“The respondents are sneaking in the Public Private Partnership Act to procure and dispose of public assets, these actions should be frowned upon as they are in contravention of the constitution,” part of the petition stated.
The association also argued that KPA is a stable public entity that has offered employment to many people and has continued to confer rights under the constitution.
“With the coming in of the investors, the restructuring and staff reorganisation will ensue with attendant risks of redundancies and retrenchment. The government shall have contravened the constitution,” the petition stated in part.
The association was seeking a declaration that the processes leading to the issuance of the offer of the tender were unconstitutional.
The association also wanted an order issued stopping or suspending the tender processes for the disposal of berths and container terminals at the ports of Lamu and Mombasa or any other port operated by KPA to any person or entity through Public Private Partnership arrangements.
