The state has suffered a blow after the High Court ordered the coffee regulator to hold a public participation forum on the implementation of coffee exchange fees 2024 in six months.
High Court Judge Edward Muriithi in a landmark ruling ordered the Capital Markets Authority (CMA) to hold fresh public participation forums in six months, and involve the stakeholders.
The court sitting in Kerugoya, suspended the regulation that could have allowed the government backed CMA and Nairobi Coffee Exchange (NCE) through the proceeds made at the coffee auction.
The Judge ruled that the regulators used oppressive and retrogressive methods in introducing new coffee payment systems and fee structures.
The petitioners, Kirinyaga Slopes, a coffee broker, Kirinyaga Cooperative Union and National Coffee Cooperative Union (NACCU) among others, challenged the implementation of the regulations that also designed to lower the brokerage fee from two percent to one percent.
In the suit National Treasury and Economic Planning, John Mbadi, Cabinet Secretary, AG, CMA, NCE, Bankers Association of Kenya, among others were the respondents.
In the judgement, the court outlined that the dispute on fees structure was not adequately discussed among other contentious issues related to coffee reforms.
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The court also noted that the meeting with the farmers in absence of the coffee brokers and the stakeholders at the NCE is incomplete for the purposes of deliberations on the proposed market fees.
“The meeting on the fee structure ought to have been specially called for the stakeholders in the marketing system who possess the technical and skills to respond to the proposal,” said the Judge.
The court observed that the regulator failed to develop and circulate a detailed information matrix on the proposed scale of fees completely justified on the basis of scope of work done by the respective actors with comparison with actors from other countries.
The CMA dismissed requests by the coffee brokers and unions for a further consultative discussion and proceeded to impose regulations disregarding the objection, observed the court.
During the trial the Cooperative bank, providing the DSS service, that there was a public forum held between May 29, last year and July 11 last year in the major counties of Murang’a, Kirinyaga, Nyeri, Machakos and Kericho through the collaboration of CMA and NCE.
By A Correspondent
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