Blow to Gov't as High Court declares sale of Safaricom shares 'null and void'

A three-judge bench of the High Court has declared null and void the government’s partial divestiture of its 15 per cent stake in Safaricom, ruling that the process violated the Constitution and the law.

The court found that the decision to sell the government’s stake was a public policy decision that required meaningful public participation before it could be undertaken.

The judges held that neither the Cabinet nor the National Assembly subjected the proposed sale to adequate public participation, rendering the process unconstitutional.

The court further faulted the government for failing to provide sufficient information to the public about the proposed transaction, including the identity of the intended buyer.

The bench found that the government engaged in “unexplained obscurity” over the identity of the proposed buyer, made misrepresentations and concealed material information relating to the partial divestiture.

The judges said withholding or concealing material documents during a public participation process undermines the constitutional principles of transparency and accountability.

“Concealing or withholding material information and documents during public participation violates constitutional transparency requirements and invalidates the resulting policies or projects because it renders public engagement a cosmetic formality rather than a meaningful exercise,” the court ruled.

The court stressed that public participation must be meaningful and informed, requiring the government to provide citizens with adequate information to enable them to effectively participate in decisions involving public assets.

The bench also found that the proposed sale, including arrangements relating to the merger, takeover or transfer of the government’s Safaricom shares, was contrary to the law.

Consequently, the court quashed all agreements, approvals and arrangements relating to the sale, merger, takeover or transfer of the shares to or involving any person or entity.

The court further ordered that the 15 per cent Safaricom shareholding be restored to the Government of Kenya, to be held on behalf of the people of Kenya.

The relevant approvals and transactions arising from the proposed divestiture were consequently cancelled and declared null and void.

The ruling effectively means that the government retains the 15 per cent stake in Safaricom on behalf of the Kenyan people.