High Court Validates Key Maritime Regulations

The High Court in Mombasa has dismissed a petition challenging the Merchant Shipping Regulations and a Tariff Framework guideline introduced in 2024, a move that is expected to significantly influence public debate and policy execution within Kenya's maritime industry. Justice Olga Sewe ruled that the Cabinet Secretary for Mining, Blue Economy and Maritime Affairs, alongside the Kenya Maritime Authority (KMA), acted within their legal mandate and complied with constitutional and statutory requirements in formulating these regulations.

The Kenya Ships Agents Association (KSAA) had filed the petition, seeking to invalidate Legal Notice numbers 90, 91, 92, and 94 of 2024. These notices cover critical areas such as maritime labour, collision prevention, transport operators, load lines, tonnage measurement, and recognised organisations. KSAA had argued that there was insufficient public participation and that the new rules would impose undue financial and operational burdens on stakeholders. However, Justice Sewe found that the regulatory process was transparent and participatory, noting that KSAA itself had been invited to public participation workshops and asked to guide its members in submitting feedback.

Context of Kenya's Maritime Sector

Kenya's maritime domain is crucial for its economy, facilitating significant imports and exports and serving as a gateway for trade to East Africa. The Kenya Maritime Authority (KMA), established in 2004 and legally constituted in 2006, is mandated to regulate, coordinate, and oversee maritime affairs to ensure safe navigation, promote maritime security, and prevent marine pollution. The Merchant Shipping Act of 2009 provides the primary legal framework for these activities.

In recent years, Kenya has actively pursued the development of its Blue Economy, aiming to leverage its marine resources for economic growth and job creation. This includes initiatives to improve port infrastructure, enhance logistics, and promote sustainable shipping practices.

Law and Policy Framework

The upheld Merchant Shipping Regulations, 2024, are part of a broader effort to modernise Kenya's maritime legal framework. These regulations aim to raise safety and labour standards, ensure fair competition, reduce the cost of doing business, and promote investment in the maritime and logistics sectors. The Tariff Framework Guideline, which KSAA had also challenged, was clarified by the court as an administrative guideline for Maritime Transport Operators to review and file tariffs, rather than a statutory instrument requiring parliamentary approval.

Previously, in November 2024, the Kenyan government had rescinded earlier stringent regulations, the Merchant Shipping (Maritime Transport Operators) Regulations, 2024, which had limited foreign ownership in domestic maritime transport firms and imposed other restrictions. This reversal followed widespread outcry from industry stakeholders who argued the regulations could discourage foreign investment and harm Kenya's economy. The government assured operators that 2025 licenses would be granted under previous regulatory criteria.

Stakeholder Perspectives

The maritime sector involves diverse stakeholders, including government ministries, departments, and agencies (MDAs), private sector entities, international organisations, and community-based organisations. Government MDAs, such as the KMA and Kenya Ports Authority (KPA), focus on creating a robust regulatory environment and promoting sustainable maritime development.

Private sector businesses are primarily concerned with investment costs, technology readiness, and regulatory certainty, seeking a favourable environment for innovation and economic benefits. International organisations emphasise alignment with global standards and provide financial assistance, while community-based organisations advocate for inclusive development and environmental sustainability.

Evidence and Data

• The global market for Marine Insurance was estimated at $29.6 billion in 2023 and is projected to reach $33.7 billion by 2030.
• Kenya's coastline stretches over 600 kilometres, with the Port of Mombasa serving as a critical hub for regional trade.
• The KMA's 2023-2028 strategic plan aims to create 187,000 jobs, generate KSh 960 billion in GDP contributions, and over KSh 110 billion in state revenue from the maritime sector.
• Despite its potential, Kenya exploits only 8% of its marine fisheries potential, landing 24,580 metric tonnes annually valued at KSh 5 billion, against a potential of 300,000 metric tonnes valued at KSh 42 billion.

Risks and Implications

While regulations are vital for safety, environmental protection, and fair competition, overly stringent or improperly designed rules can stifle innovation, increase costs, and impact Kenya's competitiveness in global trade. Challenges in the maritime sector include unregulated fishing practices, degradation of marine ecosystems, poor coastal area management, and a lack of capacity and technical skills. Effective maritime governance requires coordination among various government agencies and societal actors to address these issues.

What to Watch

The implementation of the newly upheld regulations will be a key area to watch. Stakeholders will be keen on the clarity of timelines, costs, and safeguards associated with these reforms. The KMA's ongoing efforts to enhance maritime transport safety, promote trade and investment, and develop the sector sustainably will be under scrutiny. Additionally, the impact of these regulations on foreign investment and Kenya's position as a regional logistics hub will be closely monitored.