Why Uganda has taken Kenya to court
Uganda and Kenya may be headed to some strained diplomatic and trade relations after Uganda decided to sue Kenya over the importation deal of petroleum oil from Mombasa port.
The Museveni administration filed the case at the East African Court of Justice on December 28, accusing Kenya of restraining the Energy and Petroleum Regulatory Authority (EPRA) from granting it a licence to import oil through Mombasa Port, denying Uganda the rights to operate as an Oil Marketing Company (OMC) in Kenya.
Uganda said Kenya’s delay in the issuance of the license also goes against the treaty for the establishment of the East African Community.
"The complete reliance and dependency on Kenyan OMCs to import and supply petroleum products to Uganda have exposed the Republic of Uganda to supply vulnerabilities resulting in an avoidable increase in fuel pump prices," court documents submitted by Uganda read, quoted by local media Kenyans.
Uganda imports around 90% of its refined petroleum products through the Port of Mombasa in Kenya which are then transported to Uganda through the Kenyan Pipeline Company Limited (KPC).
Kenya directed the Uganda National Oil Company (UNOC) to register with the Energy and Petroleum Regulatory Authority (EPRA) as an oil marketer in Kenya for Uganda to import and export petroleum products through Kenya.
During the registration process, EPRA requested UNOC submit among others; proof of financial capability including proof of sales volumes of 6.6 million litres of super petrol/gasoil or A1jet or kerosene in Kenya, evidence of operating five licensed retail stations and operating a licensed depot with a turnover of USD 10 million over the last three years, local media Citizen reported.
Uganda sought an exemption which Kenya said it would consider at the Cabinet level. Uganda argued that the requirements were unnecessary, as the imported petroleum products were transit goods and not destined for Kenya.
Uganda further referred to the government-to-government oil deal signed by Kenya in 2023, an agreement that made Uganda’s importation of oil through Kenya a right.
Uganda expects the East Africa Court of Justice to, among others, hold Kenya responsible for the delay in granting exemptions; to declare the licensing requirement imposed by EPRA on UNOC irrelevant, irrational and illegal; to declare that UNOC does not need a license from EPRA to access the Kenya Pipeline Company’s systems or import petroleum products through Kenya and; to unconditionally accord UNOC as a service supplier of Uganda, entitled to commercial terms for the use of KPC, local media Citizen reported.
In November, the Ugandan President accused Kenyan middlemen of inflating fuel prices, and later in December, threatened to import fuel with or without the importation license, local media Kenyans reported.
