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Uhuru rejects bid to lock Swiss out of shipping line company

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President Uhuru Kenyatta has rejected Parliament’s bid to lock Swiss majority shareholder out of the Kenya National Shipping Line (KNSL).

Mr Kenyatta refused to assent to the Statute Law (Miscellaneous Amendments) Bill after MPs introduced changes to have the KNSL owned exclusively by the State.

MPs last week approved amendments to the KNSL Act that would have effectively locked out Mediterranean Shipping Company (MSC), a Swiss company that owns majority shares at the KNSL.

The Kenya Ports Authority and foreign companies own the firm at 53:47 per cent shareholding basis.

The KNSL operates a berth that generates more than Sh10 billion annually.

The President sent back a memorandum asking MPs to reverse their decision on grounds that “this restriction will disadvantage the Kenya National Shipping Line whose majority shareholding is held by the government, through the Kenya Ports Authority”.

“In his memorandum, the President has expressed reservations on the provisions relating to the Merchant Shipping Act, 2009 as passed by the House.

The President has a reservation with the limitation on “whole ownership,” Speaker Justin Muturi told MPs.

The House Speaker said Mr Kenyatta was concerned that the revival of the KNLS would be greatly hampered and opportunities to create employment lost, especially for youth near maritime resources.

“The President is, therefore, proposing to delete the proposed new subsection 16 (1A) as passed and to introduce a caveat that provisions of section 16 (1) (providing for ship ownership) shall not apply to a shipping line owned or controlled by the Government of Kenya,” said Mr Muturi.

The President has, however, yielded to MPs’ decision to strip Transport Cabinet Secretary of powers to determine who runs the lucrative shipping business at the second terminal of Mombasa port.

Mr Kenyatta argued the changes would assist the KNLS in collaborating with other partners, “as is the international practice, to enhance its competitiveness in the regional and global shipping markets”.

Lawmakers from the coastal region led by Mvita MP Abdulswamad Nassir successfully lobbied their colleagues to shoot down the proposal allowing the KNSL to run the second terminal unless the government fully owns it.

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