The Kenya Maritime Authority (KMA) has hired a German consultant to conduct a study aimed at boosting its safety and security oversight and raising the country’s global competitiveness.
The study, being conducted by HPC Hamburg, a subsidiary of Hamburg Port in Germany, is funded by the World Bank to the tune of Sh120 million.
Acting KMA director-general Cosmas Cherop said the consultant will also assess the logistics costs incurred on imports and exports though Mombasa port and make appropriate recommendations.
“The study is in the final stages of the first phase with stakeholders’ validation work- shop set for later this month,” Mr Cherop said in an interview at the KMA headquarters.
One of the key areas of focus is involvement of industry stakeholders in the development of new regulations after a court blocked implementation of section 16 (1) of the Merchant Shipping Act 2009.
“The court ruled that we did not carry out proper consultations, which was unconstitutional. We will engage all stakeholders with a view of explaining to them what the regulations mean and also consider concessions each party can make,” said John Omingo, the regulator’s head of commercial shipping.
He said KMA would ensure that all parties were taken care of to avoid litigations that slow their work progress.
“We are telling our stakeholders that we will to come up with realistic regulations that are acceptable by all parties. However there will be need for us to consider areas of concession,” said Mr Omingo.
There have been murmurs among the clearing and forwarding fraternity who complain that shipping lines have been allowed to operate businesses, taking up space for the small and micro enterprises in the sector.
Two years ago, the High Court delivered a ruling that rendered Section 16(1) of the Merchant Shipping Act, 2009 ineffective.
The section states: “No owner of a ship or person providing the service of a shipping line shall, either directly or indirectly, provide in the maritime industry the service of crewing agencies, pilotage, clearing and forwarding agent, port facility operator, shipping agent, terminal operator, container freight station, quay side service provider, general ship contractor, haulage, empty container depots or ship chandler.
Justice George Odunga on January 23, 2015 quashed the regulation in a case where APM Terminals, which has links with Maersk shipping line, moved to court to challenge Kenya Ports Authority’s (KPA) bid to block it from the tender to operate the first phase of the second container terminal.
“Leave is hereby granted to apply for an order prohibiting KPA from denying the applicant opportunity to participate in tender no. KPA/007/2014-5/CS for qualification of concessionaire for phase 1 of the second container terminal on the grounds that the applicant had ‘a relationship prohibited under section 16(1) of the Merchants Shipping Act 2009,” the judge ordered.
The ruling also meant that multinationals could carry on businesses related to quayside services, general ship contractors, haulage, ship brokerage, cargo consolidators, ship repairers and maritime trainers.
Early this year, Mvita MP Abdulswamad Nassir accused shipping lines of the ruling to set up businesses that should ideally be reserved for Kenyans, adding that this has resulted to dominance by foreign firms and adversely affected employment of locals.
In the 11th Parliament, the MP sent a petition to National Assembly Speaker Justin Mturi requesting for drafting of the Bills to amend the Act and force shipping lines to cede part of their businesses besides being forced to pay workers high salaries.
The petition did not however sail through but the legislator, who retained his seat in the August polls, said he would re-introduce it in the new Parliament.