Court decision paves way for maritime regulations overhaul

The Kenya Maritime Authority (KMA) has won a case against the Kenya Ships Agents Association (KSAA), which challenged the implementation of key regulations in the maritime sector.

The disputed regulations were the Merchant Shipping (Maritime Labour) Regulations, the Merchant Shipping (Prevention of Collision) Regulations, the Merchant Shipping (Maritime Transport Operators) Regulations, the Merchant Shipping (Load Lines) Regulations, the Merchant Shipping (Tonnage Measurement) Regulation, and the Merchant Shipping (Recognised Organisations) Regulation.

The petitioner, on September 2 last year, argued that the regulations were enacted without undertaking satisfactory public participation and that they imposed new operations and financial burdens on stakeholders in the maritime sector.

In the suit, KSAA sued the Cabinet Secretary for Mining, Blue Economy and Maritime Affairs; KMA; the Attorney General; and the National Assembly over the regulations.

In a judgement delivered on September 19 this year, Mombasa High Court Judge Justice Olga Sewe noted that KMA complied with the Statutory Instruments Act, CAP 2A, in respect to the public participation exercise conducted for all the regulations.

The exercise included the preparation and gazettement of the regulatory impact assessment for the proposed Maritime Transport Regulations and an explanatory memorandum annexed to the regulations, a key duty placed upon regulation-making authorities.

The judge also held that due process for enactment was followed.

The contention by the petitioner was that the tariff framework guideline published by KMA was an order or guideline of a statutory nature and that it ought to have complied with the Statutory Instruments Act.

The judge held that the said tariff framework was not a statutory instrument but a guidance intended for maritime transport operators seeking to review tariffs.

The respondents brought proof of transparency in the stakeholder participatory engagement conducted and were therefore found to have complied with the Fair Administrative Act, CAP 7L.

The court also held that the respondents acted within their legal mandate and dismissed the case for lack of merit.

The petitioner was aggrieved that the tariff framework mandatorily provides for a procedure to be adopted by Maritime Transport Operators (MTOs) seeking to change their tariffs, including the requirement to give a 90 day notice to KMA.

“In the petitioner’s view, that notice period is an inordinately long time given the fast-paced nature of the maritime business. It pointed out that the tariff framework also calls for consultations with the public on the same and that a notice be given to the public 30 days prior to the effective date of the proposed changes in tariffs,” said Just Sewe.

KSAA had contended that there was neither public participation on the tariff framework nor any notice given to the stakeholders of the maritime industry prior to its publication.

The petitioner also averred in the petition that it came across another report by KMA, published on its website, entitled “Report of Stakeholder Consultations on the Maritime Laws (Amendment) Bill and the Merchant Shipping (Maritime Transport Operators) Regulations 2022” (“the 2nd Report”), in which KMA attempted to outline its efforts in ensuring public participation in respect to the Draft MTO Regulations.

KSAA pointed out that KMA failed to attach the responses to the said consultations or the findings.

In their view, these so-called public participation activities lacked transparency, given that no information could be gleaned as to what transpired during the various stakeholder engagement processes.’

The National Assembly also opposed the petition in a replying affidavit by Samuel Njoroge, dated September 30, 2024, pointing out that under Article 94(5) of the Constitution, no person or body, other than Parliament, has the power to make provisions having the force of law except under authority conferred by this Constitution or by legislation.

Njoroge added that Article 94(5) of the Constitution, as read with Section 11 of the Statutory Instrument Act, requires that all regulation-making authorities submit copies of all statutory instruments to the National Assembly for approval.

Over the years, proposals for developing a specific regulatory framework for the maritime transport services in the country have faced heavy resistance from dominant sector players, particularly those undertaking vertical integration in shipping operations.

In 2011, attempts to regulate the maritime service operators through the enactment of the Merchant Shipping (Maritime Service Providers) Regulations flopped when the guidelines were successfully challenged in the Mombasa High Court on the grounds of general inconsistency with the Constitution.

Similarly, section 16 of the Merchant Shipping Act, CAP 389, a provision meant to boost local investment and the local maritime industry, was also challenged in the Mombasa High Court and the said section was rendered inconsistent with the Constitution.

With the victory, KMA now hopes to implement robust and effective regulations for the maritime sector to enhance safety, security, and maritime labour standards.

According to the Maritime Transport Operators Regulation, it is projected that the regulations will promote the participation of Kenyans in the maritime transport and logistics sector, reduce unfair competition among maritime transport operators, and promote quality service delivery.

The regulation is also expected to reduce the costs of doing business in the sector, promote investment, reduce continuous loss of revenue from unlicensed maritime transport operators, and build the capacity of maritime professionals and transfer skills in the maritime sector and the blue economy at large.

The government is set to transition the maritime sector and wider blue economy from policy to practice through sustainable exploitation of the vast resources available to Kenyans and foreign investors at a level playing field, in line with Kenya’s Vision 2030.

KMA Director General Omae Nyarandi now hopes to implement robust and effective regulations for the maritime sector to enhance safety, security, and maritime labour standards.

On the Maritime Transport Operators Regulation, KMA projects that the regulations will promote the participation of Kenyans in the maritime transport and logistics sector, reduce unfair competition among maritime transport operators, and promote quality service delivery.

On the Maritime Transport Operators Regulation, it is projected that the regulations will promote the participation of Kenyans in the maritime transport and logistics sector, reduce unfair competition among maritime transport operators, and promote quality service delivery.

The regulations are also expected to reduce the costs of doing business in the sector, promote investment, reduce continuous loss of revenue from unlicensed maritime transport operators, and build the capacity of maritime professionals and transfer skills in the maritime sector and the blue economy at large.

The government is set to transition the maritime sector and wider blue economy from policy to practice through sustainable exploitation of the vast resources available to Kenyans and foreign investors on a level playing field, in line with Kenya’s Vision 2030.