High Court of Kenya Declines to Halt Planned Privatisation of Kenya Pipeline Company

By : Mweru Mbugua 

The High Court has declined to issue conservatory orders stopping the planned privatisation of the Kenya Pipeline Company (KPC), dealing a temporary setback to Busia Senator Okiya Omtatah who had sought urgent intervention

In a ruling delivered on Monday, Justice Lawrence Mugambi said it would be inappropriate to grant substantive orders at this stage, noting that the matter had only been listed for mention

The judge observed that the case raises contested legal issues  including questions of res judicata and jurisdiction which must first be determined before any interim relief can be considered. Consequently, the court declined to issue immediate orders and directed that the preliminary objection and the application for conservatory orders be heard together

Omtatah had petitioned the court seeking to halt what he described as an imminent and unconstitutional privatisation process, including an Initial Public Offering (IPO) reportedly nearing completion

At the centre of the petition are concerns about the sale of public investments and the alleged influence of the International Monetary Fund (IMF) on Kenya’s fiscal decisions

The senator questioned whether international lenders such as the IMF can “micromanage” the use of public funds and whether such institutions can be subjected to Kenyan jurisdiction and sued in local courts

Supporting the application, constitutional lawyer Kibe Mungai argued that the matter raises weighty constitutional questions touching on public finance and national sovereignty. He urged the court to empanel a multi-judge bench under Article 165(4) of the Constitution

Mungai warned that executive decisions involving the disposal of public investments for budgetary support could expose the country to long-term financial strain

“All countries, including Singapore, maintain public investments to enable governments to raise revenue beyond direct taxation. If we allow the sale of public assets purely for budgetary reasons, Kenya risks increasing the tax burden on its citizens,” he submitted

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The respondents opposed the application, arguing that substantive relief cannot be granted on a mention date. They further contended that some of the issues raised had already been determined in a previous ruling by Justice Bahati Mwamuye

“The only outstanding issue is that of the IMF,” the court was told

The case will now proceed with the High Court set to hear both the preliminary objection and the application for conservatory orders together before determining the next course of action