The Mombasa High Court has stopped the Kenya Revenue Authority from implementing a new system for cargo clearance.
A petitioner, Mohammed Samow, on August 2, accused KRA of failing to engage the public in implementing the new system.
The petitioner said the new system, rolled out in July, had led to significant delays in cargo clearance, increased storage and demurrage fees and added unnecessary costs for importers.
“The cumbersome nature of the system had worsened conditions for traders, created additional tariff barriers and lacked transparency, accountability and efficiency,” Samow said in the petition.
Prior to the implementation, it only took 1-3 hours to clear goods.
“However, with the new system, it takes traders between 3-16 days or more to clear goods,” he said.
KRA Commissioner General Humphrey Wattanga and Commissioner of Customs and Border Control, Lilian Nyawanda, ought to have consulted stakeholders before the rollout of the new system.
Samow said KRA failed to issue publish notices via any major newspapers or hold a single public forum, thereby violating several provisions of the constitution, including Articles 10, 35, and 47, which emphasise public participation and fair administrative action.
Further, the failure to provide public stakeholders with a draft of the new system in a timely manner violated the Access to Information Act.
As a result, Samow requested the court to declare the new system unconstitutional and to issue conservatory orders to halt its further operationalisation.
In response, KRA opposed the petition through affidavits sworn by officer Kenneth Mbobua on August 7, 2024.
Mbobua argued that the changes were merely an administrative reorganisation involving the redeployment of verification officers, not a policy or legal shift that would warrant public participation.
The cargo clearance process was not changed.
“There was no new system, process or procedure introduced. The process of cargo clearance remains as per the provision of the East African Community Customs Management Act, supported by the existing Integrated Customs Management System and payment gateway which remains unchanged,” Mbobua said.
The petitioner failed to establish the existence of old and new systems and their differentiations, if any, Mbobua argued.
He also explained that the time taken to clear cargo depends on a number of variables.
“The revenue performance is merely an outcome of the clearing process, but has other interdependent factors such as volume of imports and nature of imports.”
However, in his ruling on Monday, Judge Julius Ng’arng’ar said the Centralisation of Head of Verification Officers represented a new system, with broad implications for port users and, as such, required public participation.
In a 12-page judgement, Ng’arng’ar said while KRA’s goal of streamlining cargo clearance was not in dispute, the constitutional principle of public participation could not be bypassed.
“The respondent (KRA) cannot say it was within its mandate under Section 5 (2) of the East African Community Customs Management Act and that the petitioner’s need for public participation is inviting the court to get entangled in administrative decisions and to micromanage their human resource administrative measures,” he said.
Article 2 (4) provides that any law that is inconsistent with the constitution is void to the extent of the inconsistency and any act or omission in contravention of the constitution is invalid.
Under Article 165 (3), the court has jurisdiction to hear any question on the interpretation of the constitution in a manner that promotes its values and purposes, which include public participation.
“This court therefore has powers to issue remedies to ensure that the constitution is not violated or threatened,” he said.
The judge declared the Centralisation of the Head Verification Officers system unconstitutional, as KRA violated Articles 10, 27, 33, 35, 47, 50, 201 and 210 of the Constitution.
“From the analysis, it is clear that in the obtaining scenario, public participation was a necessary constitutional imperative which needed to be complied with. It is trite fact and admitted by the respondent that public participation was not done in respect of the changes effected by the respondent.”
The court issued a conservatory order preventing the implementation of the new system until KRA complies with the requirement for public participation.
“Consequently, flowing from the facts, evidence and the law, this court is allowing the petition,” he ruled.