Kenya’s land com­mis­sion bomb­shell to min­istries

The East African - - BUSINESS - By NJIRAINI MUCHIRA Spe­cial Correspondent

IN­VESTORS IN Kenya’s mining and oil sec­tors have been op­er­at­ing on il­le­gally awarded li­cences, while pay­ing fees, rents and roy­al­ties to unau­tho­rised gov­ern­ment agen­cies, ac­cord­ing to the Na­tional Lands Com­mis­sion.

The com­mis­sion says it is the cus­to­dian of all pub­lic land and thus man­dated by law to is­sue li­cences and col­lect all pay­ments for land us on be­half of the gov­ern­ment.

NLC is bas­ing its claims on the Na­tional Lands Act that stip­u­lates that a lease or li­cence for pub­lic land shall be is­sued by the com­mis­sion. Sec­tion 28 of the Act states that rents and other pay­ments and roy­al­ties re­ceived un­der any lease li­cence shall be a debt owed to the com­mis­sion and shall be paid by the li­censee to the com­mis­sion, while Sec­tion 29 im­poses in­ter­ests for fail­ure to make pay­ments to the com­mis­sion.

“All roy­al­ties be­long to the gov­ern­ment but must be paid to the com­mis­sion which dis­trib­ute to the rel­e­vant gov­ern­ment agen­cies and the com­mu­ni­ties,” said Mo­hamed Swazuri, NLC chair­man.

The as­ser­tion by the NLC ex­poses the supremacy wars be­tween gov­ern­ment min­istries and agen­cies, some­thing that could fur­ther dent Kenya’s ef­forts to at­tract in­vestors in the mining and oil sec­tors.

“The man­ager of pub­lic land is none other than NLC. We have not been ap­proached by any­one for land for prospect­ing, yet any pub­lic land use must be au­tho­rised by the com­mis­sion,” said Mr Swazuri.

He fur­ther said that while the com­mis­sion has been silent on the is­sue, it in­tends to start en­forc­ing its man­date of li­cens­ing all ac­tiv­i­ties on pub­lic land and col­lect­ing the rel­e­vant rents, roy­al­ties and other forms of pay­ments on be­half of the gov­ern­ment.

“We want to lay the foun­da­tion of en­gage­ment with stake­hold­ers, county gov­ern­ments and rel­e­vant min­istries,” he said.

In pro­claim­ing cus­tody of all pub­lic land, the NLC has opened a war front with the min­istries of En­ergy and Pe­tro­leum, and that of Mining, which have been is­su­ing in­vestors with prospect­ing, ex­plo­ration and mining li­cences.

“As far as I am con­cerned, the is­su­ing of ex­plo­ration li­cences in the oil in­dus­try is the man­date of the Cabi­net Sec­re­tary [min­istry of en­ergy and pe­tro­leum] based on the ad­vice of a spe­cial com­mit­tee,” Pe­tro­leum prin­ci­pal sec­re­tary An­drew Ka­mau told The Eastafrican.

The NLC is also headed for a clash with the Na­tional Trea­sury for seek­ing to di­rectly re­ceive roy­al­ties paid by mining com­pa­nies in the coun­try.

The claim by NLC is bound to fur­ther an­tag­o­nise in­vestors who were al­ready jit­tery over reg­u­la­tory un­cer­tain­ties, na­tional and county gov­ern­ments de­mands, lo­cal com­mu­nity re­sis­tance to pro­jets and pres­sure from civil so­ci­ety par­tic­u­larly on the is­sue of en­vi­ron­men­tal con­ser­va­tion.

The bomb­shell by the NLC comes on the heels of a re­port by Price­wa­ter­house­coop­ers that reg­u­la­tory un­cer­tain­ties is among key fac­tors mak­ing it im­pos­si­ble for com­pa­nies and in­vestors to op­er­ate in Africa’s oil and gas sec­tor.

“It is dis­heart­en­ing that gov­ern­ments are not catch­ing up to de­mands and calls from oil and gas com­pa­nies to en­sure reg­u­la­tory cer­tainty to play­ers who are look­ing to in­vest in hy­dro­car­bons,” states the re­port.

Pic­ture: File

Mo­hamed Swazuri, chair­man of the Na­tional Land Com­mis­sion.

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