Companies
Court suspends law placing salt firms under mining regulations
Tuesday May 16 2023
A table salt shaker. Court has suspended the government’s move to place the salt processing companies under the mining regulations. FILE PHOTO | NMG
The Court of Appeal has suspended a decision dismissing a petition by salt processing firms challenging the government’s move to place the companies under the mining regulations.
A bench of three judges ruled that the salt processing firms had an arguable case as the court will determine whether edible salt is regulated under the Mining Act, of 2016.
Further, the court noted that the salt companies might be affected if the government goes ahead and implements the decision, which will force the firms to renew their leases.
The firms claimed they stand to give up leases of between 50 and 90 years to get new leases and be forced to pay double taxes.
“In our view, the Applicants have met the conditions for the grant of a stay pending appeal,” Justices Gatembu Kairu, Pauline Nyamweya and Jessie Lesiit ruled.
The salt companies including Krystalline Salt, Kurawa Industries Ltd, Malindi Salt Works Ltd and Kensalt Ltd, challenged the move saying the Mining Act, 2016, extinguished their salt harvesting rights which they had always enjoyed.
The court heard that the firms are required to seek fresh salt harvesting rights from the Ministry of Mining and comply with the conditions under the Act.
They argued that the Mining Act made no reference to edible salt when it brought within its regulatory ambit industrial and construction salt, and which exempted certain products including edible salt.
The firms argued that they had signed an agreement with the government to harvest edible salt from the seawater and they pay Sh160,000 for every two tonnes of salt as royalties until the expiry of their leases.
The royalties, according to them, should be paid to the Ministry of Lands and not that of Mining.
The firms further claimed that salt is not excavated as indicated in the Act, and should, therefore, not be regulated by the mining law.
The judges ruled that the loss of existing rights, and of long unexpired leases to land, if not suspended may not be reversible, or the companies be adequately compensated in case they win the appeal.
