Govt To Appeal Court Ruling That Nullified Sale Of KICC & 10 Parastatals

The government has revealed plans to appeal a High Court ruling on Tuesday, September 24 that declared the Privatisation Act 2023 unconstitutional in its entirety.

The court ruled at the time on a petition filed by the Katiba Institute and Orange Democratic Movement (ODM) Party and deemed the sale of Kenyatta International Convention Center (KICC) as unconstitutional null and void.

In its submissions to the International Monetary Fund (IMF), the National Treasury revealed that the appeal would seek to revitalise the planned privatisation of eleven state-owned institutions, including KICC.

The John Mbadi-led Ministry revealed that it had commenced the process of reevaluating 70 government entities for either liquidation, privatisation, or reintegration.

A photo of IMF offices. /DAILY SABAH

"The authorities have undertaken financial evaluations of seventy State Corporations based on their FY2022/23 accounts, providing specific recommendations and actions for each State Corporation. The National Treasury has submitted a policy paper to the Cabinet recommending the consolidation, dissolution/privatization, or reintegration into the line ministries of a number of State Corporations," read part of the IMF report. 

"On February 14 and June 11, the Cabinet approved state divesture in eleven entities that are not impacted by the new Privatization Act of 2023, which, however, was declared unconstitutional by the High Court on September 24 on grounds of insufficient public Consultation. The authorities intend to pursue their privatization agenda and plan to seek legal recourse to the High Court ruling."

The High Court had deemed the Act null and void after it argued that KICC is a national monument and that its proposed sale violates constitutional and cultural rights.

“The entire Privatisation Act is unconstitutional, null and void for want of meaningful qualitative and quantitative public participation,” read part of the ruling.

“The Constitution is the supreme law, and the public must be involved in public participation. The National Assembly does not do the public a favour by inviting them to participate.”

Justice Chacha Mwita determined that the Act cannot be allowed to operate as no meaningful public participation took place before its enactment.

Mwita agreed with submissions made by ODM that filed the case in court saying the public was not allowed to give its views regarding the Act which made it easier to sell state enterprises to private companies.

ODM had argued in late 2023 that the plans by President Ruto's government to privatise the parastatals had concerns as they were the state's assets financed by the public.

Among the companies that were targeted for sale by the government include Kenya Literature Bureau (KLB), National Oil Corporation (NOC), Kenya Seed Company Limited, Mwea Rice Mills, and Western Kenya Rice Mills Limited.

The Treasury, led by former Cabinet Secretary (CS) Njuguna Ndung'u, also listed Kenya Pipeline Company, Kenya Vehicle Manufacturers Limited, Rivatex East Africa Limited, and Numerical Machining Complex as companies up for sale.