A total of 51 Tea Factory Companies, which are owned by smallholder tea farmers, have now been enjoined in a class action Constitutional Petition that challenges sections of the Tea Act, 2020.
This comes after the High Court in Embu admitted 50 additional Tea Factory Companies, to be co-petitioners, in the petition filed by Mungania Tea Factory Company Limited against the Attorney General of the Republic of Kenya.
In a court order dated the 26th of January 2021, the High Court in Embu certified the application by the 50 Tea Factory companies as urgent and directed that “the Tea Factory Companies listed as the proposed 2nd to 51st co-petitioners be and are hereby enjoined as co-petitioners in this petition.”
According to lawyers handling the petition, Millimo, Muthomi and Company Advocates, the Tea Factory Companies were enjoined in the suit as their complaints and that of the lead company, Mungania Tea Factory Company, are similar in both form and content.
Mungania Tea Factory moved to court to challenge sections of the Tea Act on the premise that the new law went against the Companies Act, 2015; The Law of Contract; The Crops Act; the Competition Act; and the Constitution.
In orders granted on January 19 following the application, the Embu High Court directed that pending the hearing and determination of the application, a conservatory order be issued “suspending the implementation and or further implementation of Sections 5 (1) (e) & (I), 21 (2), 22, 25, 33, 34, 36, 37 (3), 39, 40, 41, 42,45 and 74 of the Tea Act, 2020.”
Sections 21 of the Act contains provisions to guide the registration of small-scale tea growers and medium scale tea growers, while sections 22 and 25 provides for maximum number of board of directors for tea factory limited companies and the licensing of manufacturers respectively.
Sections 33 and 34 contain provisions guiding the registration of tea management agents, as well as their agreements with tea factories; while Section 36 provides that all black tea must be sold at the auction.
Section 74 of the Act grants the Agriculture Cabinet Secretary powers to draft regulations which guide, among others, the tenure of tea factory companies board members; maximum fees charged by players along the value chain; and regulation of contracts among industry players.
The order stopping the implementation of this section consequently stops the implementation of the various draft regulations which the Ministry has already published in line with the Act.
The petition by the Tea Factory Companies is one of three petitions that have been lodged in court by industry players challenging sections of the new law. The Kenya Tea Growers Association and the East African Tea Trade Association are the other two industry players who have challenged the new law