British American Tobacco Kenya PLC v Cabinet Secretary for the Ministry of Health & 2 others; Kenya Tobacco Control Alliance & another (Interested Parties); Mastermind Tabacco Kenya Limited (Affected Party) (Petition 5 of 2017) [2019] KESC 15 (KLR) (26 November 2019) (Judgment)
British American Tobacco Kenya, PLC
(formerly British American Tobacco Kenya Limited) v Cabinet Secretary for the
Ministry of Health & 2 others;Kenya Tobacco Control Alliance & another (Interested Parties);Mastermind Tobacco Kenya Limited (The Affected Party) [2019] eKLR
Neutral citation:
[2019] KESC 15 (KLR)
Republic of Kenya
Petition 5 of 2017
DK Maraga, CJ & P, PM Mwilu, DCJ & VP, JB Ojwang, SC Wanjala & N Ndungu, SCJJ
November 26, 2019
Between
British American Tobacco Kenya, PLC (formerly British American Tobacco Kenya Limited)
Appellant
and
Cabinet Secretary for the Ministry Of Health
1st Respondent
Tobacco Control Board
2nd Respondent
Attorney General
3rd Respondent
and
Kenya Tobacco Control Alliance
Interested Party
Consumer Information Network
Interested Party
and
Mastermind Tabacco Kenya Limited
Affected Party
(Appeal against the Judgment of the Court of Appeal (Okwengu, Azangalala and Sichale, JJA) in Civil Appeal No. 112 of 2016)
Supreme Court affirms that the Tobacco Control Regulations, 2014 are constitutional except for regulations 1, 13(b) and 45 which contravened certain provisions of the Tobacco Control Act and the Statutory Instruments Act.
Constitutional Law - national values and principles of governance - public participation - threshold to be met in the fulfilment of public participation – guiding principles in public participation – components of a meaningful public participation - role of the Tobacco Control Board in facilitating public participation in formulation Tobacco Control Regulations – whether the Tobacco Control Board was obliged to facilitate adequate consultation or public participation with the key stakeholders in tobacco business when formulating the Tobacco Control Regulations – Constitution of Kenya, article 10; Tobacco Control Act (cap 245A), sections 7 and 53.Constitutional Law - fundamental rights and freedoms - enforcement of fundamental rights and freedoms - right to equality and freedom from discrimination, right to property, right to privacy and intellectual property rights - whether the introduction solatium compensatory contribution a measure that was not subjected to other industries could be deemed to be discriminatory – whether imposing a disclosure of ingredients and compensatory contribution of 2% of the value of tobacco products manufactured and/or imported violated the right to privacy, right to property and infringed on intellectual property rights - Constitution of Kenya, articles 27 and 40.Tax Law – tax – imposition of taxes – where the Tobacco Control Act introduced solatium compensatory contribution payable by any licensed cigarette manufacturers or importers - whether the levying of a particular amount by a piece of legislation automatically transformed that payment into a tax - whether solatium whose purpose was for research and rehabilitation that was not submitted to any county or national reserve levied under the Tobacco Control Regulations 2014 was a tax - Constitution of Kenya, article 210; Tobacco Control Act, (cap 245A), section 7.
Brief facts
In a notice in the Kenya Gazette the Cabinet Secretary for the Ministry of Health (the 1st respondent) published the Tobacco Control Regulations 2014 (the Regulations) by way of legal notice. The Regulations were made pursuant to section 53 of the Tobacco Control Act, 2007 (the Act) and sought to regulate various aspects of the tobacco sector in Kenya. Section 53 of the Act gave powers for making regulations prescribing or prohibiting anything required by the Act to be prohibited, or for the better carrying out of the objects of the Act.The appellant was aggrieved by the Regulations and filed a petition at the High Court. The petition challenged the lawfulness of the Regulations and section 7(2) of the Act on grounds that inter alia, they were made in contravention of section 5 and 6 of the Statutory Instruments Act (SIA) and were discriminatory and violated certain provisions of the Constitution. The High Court declared that the Regulations were constitutional with exception to regulations 1, 13(b) and 45.Being dissatisfied by the High Court’s decision the appellant appealed to the Court of Appeal with similar grounds of appeal as in the petition. The appeal was dismissed precipitating the appeal to the Supreme Court.
Issues
- Whether the Tobacco Control Regulations 2014 were discriminatory for;
- limiting the interaction between public officers/authorities and members of the tobacco industries; and
- introducing a solatium compensatory contribution which was not subjected to other industries.
- What were the guiding principles and components of meaningful public participation?
- Whether the Tobacco Control Board was obliged to facilitate adequate consultation or public participation with the key stakeholders in tobacco business when formulating regulations.
- Whether the levying of a particular amount by a piece of legislation automatically transformed that payment into a tax.
- Whether solatium, whose purpose was for research and rehabilitation, which was not submitted to any county or national reserve levied under the Tobacco Control Regulations 2014 was a tax.
- Whether imposing a disclosure of ingredients and compensatory contribution of 2% of the value of tobacco products manufactured and/or imported violated the right to privacy, right to property and infringed on intellectual property rights.
Held
- Public participation and consultation was a living constitutional principle that went to the constitutional tenet of the sovereignty of the people. In line with the court’s mandate under section 3 of the Supreme Court Act, the following were the guiding principles for public participation:
- As a constitutional principle under article 10(2) of the Constitution, public participation applied to all aspects of governance.
- The public officer and/or entity charged with the performance of a particular duty bore the onus of ensuring and facilitating public participation.
- The lack of a prescribed legal framework for public participation was no excuse for not conducting public participation; the onus was on the public entity to give effect to the constitutional principle using reasonable means.
- Public participation had to be real and not illusory. It was not a cosmetic, public relations act or a mere formality to be undertaken as a matter of course just to ‘fulfill’ a constitutional requirement. There was need for both quantitative and qualitative components in public participation.
- Public participation was not an abstract notion; it must be purposive and meaningful.
- Public participation had to be accompanied by reasonable notice and reasonable opportunity. Reasonableness could be determined on a case to case basis.
- Public participation was not necessarily a process consisting of oral hearings, written submissions could also be made. The fact that someone was not heard was not enough to annul the process.
- Allegations of lack of public participation did not automatically vitiate the process. The allegations had to be considered within the peculiar circumstances of each case: the mode, degree, scope and extent of public participation was to be determined on a case to case basis.
- Components of meaningful public participation included the following;
- clarity of the subject matter for the public to understand;
- structures and processes (medium of engagement) of participation that were clear and simple;
- opportunity for balanced influence from the public in general;
- commitment to the process;
- inclusive and effective representation;
- integrity and transparency of the process;
- capacity to engage on the part of the public, including that the public had to be first sensitized on the subject matter.
- The Court of Appeal did not err in its findings on the meaning, scope and application of the principle of public participation.
- The Regulations making process was impugned due to lack of a Regulatory Impact Statement (RIS). While parties submitted at length on the issue before the court that issue was not for consideration by the court under article 163(4)(a) of the Constitution. The requirement for an RIS was provided for by the Statutory Instruments Act. Hence, the question(s) as to whether the same was required, exempted and/or published involved evaluation and interrogation of factual evidence; and a reading and interpretation of the Statutory Instruments Act. All those issues fell within the jurisdiction of the High Court and the Court of Appeal. There was nothing of constitutional interpretation and/or application to invoke the court’s jurisdiction under article 163(4)(a) of the Constitution.
- Part V of the Regulations (20-36) limited interactions between the tobacco industry and public officers and/or authorities. The appellant argued that the limitation infringed on article 27 of the Constitution that guaranteed the right to equality and freedom from discrimination. However, not all discrimination was unfair.
- A concept of unfair discrimination which recognized that although a society which afforded each human being equal treatment on the basis of equal worth and freedom was its goal. That goal could not be achieved by insisting upon identical treatment in all circumstances. Each case required a careful and thorough understanding of the impact of the discriminatory action upon the particular people concerned to determine whether its overall impact was one which furthered the constitutional goal of equality or not. A classification which was unfair in one context would not necessarily be unfair in a different context.
- A mere differentiation or inequality of treatment did not per se amount to discrimination within the prohibition of the equal protection clause. To attract the operation of the clause, it was necessary to show that the selection or differentiation was unreasonable or arbitrary, that it did not rest on any basis having regard to the objective the Legislature or the Constitution had in view. An equal protection was not violated if the exception which was made was required to be made by some other provisions of the Constitution. It was not possible to exhaust the circumstances or criteria which would afford a reasonable basis for classification in all cases.
- The intention behind the limitation was to ensure effective enforcement and implementation of the tobacco control laws. It accorded with the provisions of article 24 of the Constitution as it allowed differentiation in interactions with public officers between the tobacco industry and other industries which was permissible under the Constitution.
- The principle of equality did not mean that every law had to have universal application for all persons who were not by nature, attainment or circumstances in the same position and the varying needs of different classes of persons required special treatment. The Legislature understood and appreciated the need of its own people, that its laws were directed to problems made manifest by experience and that its discriminations were based upon adequate grounds. The rule of classification was not natural or logical corollary of the rule of equality, but the rule of differentiation was inherent in the concept of equality. Equality meant parity of treatment under parity conditions. Equality did not connote absolute equality. A classification in order to be constitutional had to rest upon distinctions that were substantial and not merely illusory. The test was whether it had a reasonable basis free from artificiality and arbitrariness embracing all and omitting none naturally falling into that category.
- The limitation of constitutional rights for a purpose that was reasonable and necessary in a democratic society involved the weighing up of competing values, and ultimately an assessment based on proportionality. The fact that different rights had different implications for democracy, and in the case of the Constitution, for an open and democratic society based on freedom and equality; meant that there was no absolute standard which could be laid down for determining reasonableness and necessity. Principles could be established, but the application of those principles to particular circumstances could only be done on a case by case basis.
- The inequality of treatment in limiting interaction between the public officers/authorities and members of the tobacco industry did not amount to discrimination as it was dictated by the circumstances obtaining. The limitation did not target only a specific group of players in the tobacco industry but applied to all players. To ensure the delicate balance of rights, the limitation of the appellant’s rights was justifiable, reasonable and necessary under article 24 of the Constitution to ensure the enjoyment of rights and fundamental freedoms by all individuals.
- Part III of the Regulations (12-14), on disclosure of information, did not infringe an appellant’s right to privacy or intellectual property rights. There was a balance between the appellant’s intellectual property rights and the need to protect the public health from the effects of tobacco use.
- The concept of competing rights called for utilization of the doctrine of proportionality so as to resolve the tension between such rights where it arose. In considering decisions limiting fundamental rights, courts looked at whether the Government’s decision was reasonably appropriate and adapted to serve a legitimate end. In that context, the phrase ‘reasonably appropriate and adapted’ did not mean ‘essential’ or ‘unavoidable’, but had been said to be closer to the notion of proportionality. The test of proportionality was correctly applied in resolving the friction between the competing rights of the appellant’s right to its intellectual property vis-à-vis the need to ensure a safe and clean environment, free from the hazards of tobacco use, for the public.
- The solatium (compensation given as solace for suffering loss) compensation contribution was provided by subsidiary legislation, it did not raise a constitutional question within the realm of article 163(4)(a) of the Constitution. The Tobacco Control Act provided for the Tobacco Control Fund to which the solatium compensation contribution was paid. The statute had not been impugned as being unconstitutional. For the court to interrogate whether the solatium was adequate and proportionate it had to first determine whether it was a tax. Taxation was a subject matter provided for by the Constitution. However, if it was found that the solatium was just a fee or a levy, then it was provided for within a legislative framework and therefore not a matter of constitutional issue.
- The establishment of a Tobacco Control Fund (the Fund) that was under section 7(2)(f) of the Act composed of, inter alia, a solatium compensatory contribution payable by any licensed cigarette manufacturers or importers. The solatium compensatory contribution was not a payment that went toward the national or county revenue. Under section 7(4) of the Tobacco Control Act, the purposes for which the Fund was to be used was specific as follows;
- research, documentation and dissemination of information on tobacco and tobacco products; and
- promoting national cessation and rehabilitation programs.
- The solatium was provided under statute anchored with a clear framework on its purpose. It was not a payment that was made to the consolidated fund so as to be part of the annual government budgeting and appropriation. The mere fact that a piece of legislation provided for the levying of a particular amount did not transform that payment into a tax. Having found that the solatium was not a tax, the appeal had no constitutional issue for determination by the court in exercise of its jurisdiction under article 163(4)(a) of the Constitution.
Appeal dismissed.
Orders
- The judgment of the Court of Appeal in Civil Appeal No 112 of 2016 was upheld.
- Each party was to bear its own costs.
Citations
Cases Kenya
- AIDS Law Project v Attorney General & another; VIHDA Association (Interested Party); Center for Reproductive Rights (Amicus Curiae) Petition 97 of 2010; [2015] KEHC 6972 (KLR) - (Explained)
- Anarita Karimi Njeru v Republic Criminal Appeal 4 of 1979; [1979] KECA 12 (KLR) - (Explained)
- British American Tobacco Kenya Ltd v Cabinet Secretary for the Ministry of Health,Tobacco Control Board,Attorney General,Kenya Tobacco Control Alliance & Consumer Information Network Petition 143 of 2015; [2016] KEHC 7530 (KLR) - (Explained)
- British American Tobacco Ltd v Cabinet Secretary for the Ministry of Health, Tobacco Control Board, Attorney General, Kenya Tobacco Control Alliance, Consumer Information Network & Mastermind Tobacco (K) Limited Civil Appeal 112 of 2016; [2017] KECA 763 (KLR) - (Explained)
- Coalition for Reform and Democracy (CORD) & another v Republic of Kenya & another Petition 628 & 630 of 2014; [2015] KEHC 6984 (KLR) - (Explained)
- Communications Commission of Kenya & 5 others v Royal Media Services Limited & 5 others Petition 14, 14A, 14B & 14C of 2014 (Consolidated); [2014] KESC 53 (KLR) - (Explained)
- East African Cables Limited v Public Procurement Complaints, Review & Appeals Board & another [2000] eKLR. - (Mentioned)
- Federation of Women Lawyers Fida Kenya & 5 others v Attorney General & another Petition 102 of 2011; [2011] KEHC 2099 (KLR) - (Explained)
- Gakuru, Robert N & others v Governor Kiambu County & 3 others Petition 532 of 2013 & 12, 35, 36, 42, & 72 of 2014 & Judicial Review Miscellaneous Application 61 of 2014 (Consolidated); [2014] eKLR - (Explained)
- Gakuru, Robert N. & others v. Governor Kiambu County & 3 others Petition 532 of 2013 & 12, 35, 36, 42, & 72 of 2014 & Judicial Review Miscellaneous Application 61 of 2014 (Consolidated) - (Explained)
- Independent Electoral and Boundaries Commission (IEBC) v National Super Alliance(NASA) Kenya, Al Ghurair Printing and Publishing Llc, Attorney General, Jubilee Party, Ekuru Aukot &Thirdwayalliance;, Samuel Waweru & Stephen Owoko Oganga Civil Appeal 224 of 2017; [2017] KECA 436 (KLR) - (Explained)
- Kenya National Commission on Human Rights & another v Attorney General & 3 others [2017] eKLR - (Explained)
- Keroche Industries Limited v Kenya Revenue Authority & 5 others Miscellanous Civ Appli 743 of 2006; [2007] eKLR - (Explained)
- Law Society of Kenya v Attorney General & another Constitutional Petition 185 of 2008; [2009] KEHC 2093 (KLR) - (Explained)
- Munyi, Gladys Wanjiru v Diana Wanjiru Munyi Petition 31 of 2014; [2015] KESC 9 (KLR) - (Explained)
- Nairobi Metropolitan Psv Saccos Union Limited & 25 others v County of Nairobi Government & 3 others Civil Appeal 42 of 2014; [2014] KECA 95 (KLR) - (Explained)
- Nature Foundation Limited v Minister for Information and Communication & Communications Commission of Kenya Civil Appeal 214 of 2011; [2015] KECA 976 (KLR) - (Explained)
- Ngoge, Peter v Francis Ole Kaparo & 5 others Petition No 2 of 2012 [2012] eKLR - (Explained)
- Ogendo, Richard Dickson & 2 others v Attorney General & 5 others Petition 70 of 2013; [2014] KEHC 6197 (KLR) - (Explained)
- Republic v Independent Electoral and Boundaries Commission (IEBC) Ex parte National Super Alliance (NASA) Kenya, Al Ghurair Printing and Publishing LLC, Attorney General, Jubilee Party, Ekuru Aukot & Third Party Alliance, Samuel Waweru & Stephen Owoko Oganga Judicial Review 378 of 2017; [2017] KEHC 4663 (KLR) - (Explained)
- Speaker of the Senate & another v Attorney-General & another; Law Society of Kenya & 2 others (Amicus Curiae) Advisory Opinion Reference 2 of 2013; [2013] KESC 7 (KLR) - (Explained)
- Thuku Kirori & 4 others v. County Government of Murang’a Petition 1 of 2014; [2014] KEHC 4667 (KLR) - (Explained)
- Trusted Society of Human Rights Alliance & 3 others v Judicial Service Commission & another; Law Society of Kenya (Interested Party); Article 19-Eastern Africa Curiae (Amicus Curiae) Petition 314 of 2016 & Judicial Review 306 of 2016 (Consolidated); [2016] KEHC 3581 (KLR) - (Explained)
- Waruathe, Samuel Thinguri & 2 others v Kiambu County Government & 2 others Judicial Review Miscellaneous Application 122 of 2014; [2015] KEHC 5590 (KLR) - (Explained)
- Doctors for Life International v Speaker of the National Assembly and Others (CCT12/05) [2006] ZACC 11; 2006 (12) BCLR 1399 (CC); 2006 (6) SA 416 (CC) (17 August 2006) - (Explained)
- Johncom Media Investments Limited v M and Others (CCT 08/08) [2009] ZACC 5, - (Explained)
- Merafong Demarcation Forum v President of the Republic of South Africa[ [2008] ZACC 10 - (Explained)
- Minister of Health v New Clicks South Africa (PTY) Ltd (2006) (2) SA - (Explained)
- Poverty Alleviation Network & others v President of the Republic of south Africa & others [2010] ZACC 5
- President of the Republic of South Africa & Anor vs. John Philip Hugo 1997(4) SAICC - (Explained)
- S v Makwanyane and another CCT 3/94 (1995) 2A CC3 - (Explained)
- S v Manamela & another (Director-General of Justice Intervening) (CCT25/99) [2000] ZACC 5; 2000 (3) SA 1; 2000 (5) BCLR 491 - (Explained)
- AG v Ryan (1980) AC 718 - (Explained)
- Heydon’s Case 76 ER 637 - (Explained)
- Utah Construction & Engineering Pty Limited v Pataky (1966) AC 629 - (Explained)
- Maharashtra State Board of Secondary’ & Higher Secondary’ Education v Kurmarsheth & others 1984 AIR 1543, 1985 SCR (1) 29 - (Explained)
- State of Kesata and another v NM Thomas and others, 1976 AIR 490, 1976 SCR (1) 906 - (Explained)
- Constitution of Kenya - (Interpreted) articles 10, 24, 37, 40, 42, 43, 110; 118; 163(4); 210; 259; 260; Chapter 6
- Fair Administrative Action Act (cap 7L) - (Cited) In general
- Leadership And Integrity Act (cp 185C) - (Cited) In general
- Public Officer Ethics Act (cap 185B) - (Cited) In general
- Statutory Instruments Act (cap 2) - (Interpreted) sections 5(1); 6; 9(g)(h)
- Supreme Court Act (cap 9B) - (Interpreted) section 3
- Tobacco Control Act (cap 245A) - (Interpreted) sections 7(2); 13(a)(c)(d); 24(5); 32; 33(7); 34; 35; 37; 38; 39; 53
- Tobacco Control Regulations, 2014 (cap 245A Sub Leg) - (Interpreted) regulations 1, 3, 12, 13(b); 14; 15(b); 38; 42; 45; part V
- Tourism Act (cap 381) - (Interpreted) section 105
- Vienna Convention on the Law of Treaties, 1969 article 31
- World Health Organization (WHO) Framework Convention on Tobacco Control (FCTC) articles 5(3); 6; 20(2)
Judgment
I. Introduction
1.The appellant moved the court via a petition dated March 31, 2017, being an appeal against the Judgment of the Court of Appeal (Okwengu, Azangalala and Sichale, JJA) in Civil Appeal No 112 of 2016, which decision upheld the Judgment of the High Court, in High Court Petition No 143 of 2015, British American Tobacco Kenya Limited v Cabinet Secretary for the Ministry of Health & 4 others that judgment held that there was adequate consultation or public participation in the formulation of Tobacco Control Regulations, 2014 and that, except for regulations 1, 13(b) and 45, the provisions are neither unconstitutional nor unlawful nor do they violate any right of the appellant, the affected party or the Tobacco industry players.
2.The appellant sought the following reliefs (produced verbatim), that:i.The appeal to be allowed.ii.The Judgment of the Court of Appeal in Civil Appeal 112 of 2016 be set aside and judgement be entered as prayed in the petition in the High Court on April 15, 2015.iii.The costs in this Appeal, Civil Appeal 112 of 2016 British American Tobacco Kenya Limited v Cabinet Secretary for the Ministry of Health & 4 others, and High court Petition Number 143 of 2015 British American Tobacco Kenya Limited v Cabinet Secretary for the Ministry of Health & 4 others, be awarded to the appellant.iv.Any further or alternative relief this Honourable Court may deem fit to grant.
II. Background
3.In a Notice in the Kenya Gazette dated December 5, 2014, the 1st Respondent published the Tobacco Control Regulations, 2014 (herein after referred to the Regulations) by way of Legal Notice No 169 (Legal Supplement No 161). The Regulations were made pursuant to section 53 of the Tobacco Control Act, 2007 (herein after referred to the Act) and sought to regulate various aspects of the Tobacco sector in Kenya. section 53 of the Act gives powers for making Regulations prescribing or prohibiting anything required by the Act to be prohibited, or for the better carrying out of the objects of the Act.
(a) High Court
4.The appellant was aggrieved by the Regulations and filed at the High Court, Petition No 143 of 2015 British American Tobacco Kenya Limited v Cabinet Secretary for the Ministry of Health & 4 others on April 15, 2015. The Petition challenged the lawfulness of the Regulations and section 7 (2) of the Act on grounds that inter alia, they were made in contravention of the provisions of the Statutory Instruments Act (SIA) and violated certain provisions of the Constitution. The Petition sought the following orders:1.A declaration that Tobacco Control Regulations, 2014 being Legal Notice Number 169 of 2014 published in the Kenya Gazette Supplement 161, Legislative Supplement Number 156 of 2014 are void in their entirety having failed to comply with the applicable provisions of the Statutory Instruments Act 2013 and article 10 of the Constitution.2.An order for judicial review by way of certiorari to remove into the High Court and quash the Tobacco Control Regulations, 2014 in their entirety.3.In the alternative to (2) above, an order for judicial review by way of certiorari to remove into the High Court and quash Regulations 3 to 39 (both inclusive) and Regulation 45 of the Tobacco Regulations 2014.4.In the alternative to (1) and (2) above:a.A declaration that Regulation 1 of the Tobacco Control Regulations, 2014 is not applicable to Part II of the Regulations.b.A declaration that Part VI (Regulations 37 and 38) of the Tobacco Control Regulations, 2014 is void.c.A declaration that Part V (Regulations 20 to 36) of the Tobacco Control Regulations, 2014 is voidd.A declaration that Part II (Regulations 3 to 7) of the Tobacco Control Regulations, 2014 is void.e.A declaration that Regulation 15(b) of the Tobacco Control Regulations, 2014 is void.f.A declaration that Regulation 45 of the Tobacco Control Regulations, 2014 is void.g.A declaration be made that section 7(2) (f) of the Tobacco Control Act 2007 is void.5.Any further order or relief that this Court deems fit to make to meet the interests of justice.6.The costs of this Petition be awarded to the Petitioner.
5.The crux of the appellant’s case was that the Cabinet Secretary (CS) for Health and the Tobacco Control Board (herein after referred to the Board) did not engage with the Tobacco industry stakeholders in the process of developing the Regulations; and that where there was such engagement, it was limited and entirely unsatisfactory. The appellant invoked section 5(1) of the SIA in submitting that where a proposed Regulation is likely to have a substantial direct or indirect impact upon business or restrict competition, the regulatory authority is required to consult with persons likely to be affected. It also argued that the Regulations impose significant costs on the Tobacco industry generally and the community at large, yet there was no evidence of a Regulatory Impact Statement (RIS) obtained by the Board as provided by section 6 of the SIA.
6.The appellant also challenged the Regulations’ introduction of the Solatium Compensatory Contribution (the Solatium) alleging that it was never heard on the basis for imposing the said contribution. It urged that the imposition was unconstitutional and unlawful as it was not based on any lawful obligation to pay compensation. The amount was deemed discriminatory, as other industries have not been subjected to such measures; and that the wording of regulation 38, that the solatium shall be 2% of the value of Tobacco products manufactured and/or imported, was vague and uncertain as it was not clear which information will be used to ascertain the value of manufactured or imported Tobacco.
7.Also challenged was the Regulations’ limitation of contact between public officers and Tobacco industry players. It is urged that this limitation undermines the appellant’s right to fair administrative action and offends the principles of good governance, including public participation, inclusiveness and non-discrimination. As a result, it brings into question the constitutionality of Regulation 3, as regards packaging and labelling of Tobacco products. The Regulations were impugned for being unreasonable, disproportionate, irrational and onerous because there is an East African Standard, EAS 110: 2005, which provides the specifications for cigarettes and is administered by the Kenya Bureau of Standards, which the appellant submits to as its cigarettes are submitted annually for testing and certification by that body.
8.It was contended that the information required to be disclosed under regulation 42 comprises manufacturer’s trade secrets or sensitive information, which is ‘protected and that the information if released, may also mislead the public as it may deem one product less risky than another, yet cigarettes with ingredients, are no more or less harmful than those with ingredients. It impugned regulations 13 on market share. It contended that regulation 15 was unconstitutional as it prohibited smoking in streets, walkways and verandas adjacent to public places. It urged that regulation 15(b) had extended the restriction to areas not contemplated under section 33(7) of the Act.
9.Regulation 45 which prescribes a penalty of a fine not exceeding five hundred thousand shillings or imprisonment for a term not exceeding three years for breach of any provision of the Regulations was challenged for being unconstitutional. It was argued that it is ultra vires section 24(5) of the SIA which only allows a penalty for breach of any provision of Regulations to be a penalty not exceeding twenty thousand shillings or imprisonment not exceeding six months or both. Lastly, the appellant contended that neither the CS Health nor the Board had any powers to make legislation to domesticate or implement article 5.3 of the World Health Organization (WHO) Framework Convention on Tobacco Control (FCTC) and the Guidelines thereto.
10.The Respondents’ case on the other hand, was that as a signatory to the FCTC, Kenya is obligated to fulfil its commitment by enacting and implementing legislation and Regulations compliant with the Convention. It was urged that under section 9 (g) & (h) of the SIA, a RIS need not be prepared for publication if the proposed Regulation is a matter arising under legislation that is substantially uniform or complementary with legislation of the national government or of any county, similarly, a matter advance notice of which would enable someone to gain unfair advantage.
11.The Respondents stated that the Regulations were for the benefit of the community and shall not impose significant costs on the community or part of the community. It was urged that there was public participation meetings held in over eight counties which views were considered and that the Regulations were made in compliance with the provisions of the SIA. Therefore, the Regulations were not unconstitutional. Further it was urged that the Regulations on limitation on contact between public officers and members of Tobacco industry are in conformity with chapter 6 of the Constitution. The imposition of 2% solatium compensatory contribution was stated to be in conformity with the Constitution, section 7(2)(f) of the Act and article 6 of the WHO Framework Convention. It was argued that the solatium is meant to cater for any health perils caused by Tobacco.
12.In its judgment the High Court, Mumbi J, delimited three issues for determination as follows:(a)Whether the process leading to the enactment of the Tobacco Regulations, 2014 was lawful?(b)Whether specific Regulations are unconstitutional for being arbitrary or unreasonable?(c)Whether a violation of the Petitioner’s constitutional rights has been made out?
13.Finally, the High Court made the following disposition:
14.The appellant was dissatisfied with the High Court decision, and lodged an appeal in the Court of Appeal.
(b) Court of Appeal
15.In its memorandum of appeal, the appellant raised 17 grounds on which it faulted the High Court judgment.
16.Parties made their rival submissions before the Court, which to a large extent echoed what they had submitted before the High Court. In its judgment delivered on February 17, 2017 the Court of Appeal delimited the following issues for determination:(i)Whether the process leading to the making of the Regulations was vitiated by lack of public participation and consultation as to render the Regulations unconstitutional or unlawful?(ii)Whether the specified provisions of the Tobacco Act and Regulations are unconstitutional, ultra vires or otherwise illegal?(iii)Whether the learned Judge’s findings on issue (i) and (ii) were correct?(iv)Whether the learned Judge’s view on the health effects of the Tobacco products were relevant to the proceedings?(v)Whether specific Regulations identified by the appellant violated the appellant’s rights as alleged?(vi)Arising from (i) to (v), whether the appeal should be allowed or dismissed?
17.The Court of Appeal agreed with the High Court on public participation and consultation. The Appellate Court appreciated the case law relied on by the High Court, buttressing that public participation is a mandatory requirement in the process of making legislation including subsidiary legislation. It evaluated the affidavit evidence on record and found no reason to upset the High Court findings. As regards the RIS, the Appellate Court also agreed with the High Court that it was not necessary to prepare the RIS in this matter.
18.As to whether specific Regulations violated the appellant’s rights, the Court of Appeal held that while the provisions of part V of the Regulations appear to be discriminatory against the appellant and others in the Tobacco industry as they seek to limit interactions between players in the Tobacco industry and public officers and/or authorities, a situation not replicated in other commercial industries, not all discrimination amounted to unfair discrimination. Noting the peculiar nature of the Tobacco industry and having taken note of the side effects of the Tobacco products the Court held that “the inequality of treatment in limiting interaction between the public officers/authorities and members of the Tobacco industry does not amount to discrimination as it is dictated by the circumstances obtaining. Moreover, the limitation does not target only a specific group of players in the Tobacco industry but applies to all players in the Tobacco industry.” It found the limitation of the appellant’s rights justifiable, reasonable and necessary under article 24 of the Constitution to ensure the enjoyment of rights and fundamental freedoms by all individuals. article 37 was found not to have been violated. As the Regulations were found to have been made in accordance with the SIA and the Constitution, it was held that the procedure was in line with the Fair Administrative Action Act with regard to public participation, and there was no violation of article 47 of the Constitution.
19.On the solatium compensatory contribution, the appellate Court found that it was not a payment that goes towards the national revenue, and could not be considered that is levied by the national government or county government for the purposes of national or county revenue. It does not violate article 210 of the Constitution and its imposition cannot amount to deprivation of the appellant’s property under article 40 of the Constitution.
20.As regards the Regulations on packaging and labelling, the appellate Court agreed with the High Court findings, that the purpose of the Regulations, in prescribing health warnings through packaging and labeling of Tobacco products, was to achieve the object of the Act by providing information and cautioning consumers and non-consumers of the side effects of Tobacco products. They found the Regulations to be in accord with the parent legislation.
21.On unconstitutionality of specific provisions, regulation 15(b) which bars smoking in streets, walkways or verandas adjacent to a public place was found not ultra vires the Act as it seeks to effect section 32 of the Act. As regards Part III of the Regulations, on disclosure of information, it was found that the disclosures required under regulations 13(a), (c), (d) and (e) on Tobacco produced, sales made and revenues earned, quantities exported and affiliated organizations or agents citing on behalf of a manufacturer, are relevant in light of Regulation 37 that requires the payment of the Solatium compensatory contribution at 2% of the value of the Tobacco manufactured or imported by the manufacturer or importer in that financial year. On the disclosure requirements under regulation 12, the appellate Court observed that there was a need to balance public health needs against intellectual property rights of the appellant and other stakeholders in the Tobacco industry. It found that the limitation was reasonable and justified under article 24 of the Constitution.
22.The Court of Appeal dismissed the appeal stating as follows:
23.It is this finding of the Court of Appeal that has aggrieved the appellant and hence the Petition now before this Court.
III. The Petition Before Court
24.Before the Supreme Court, the appellant alleges that its claims raise the following points of law, reproduced verbatim:a.What do the principles of ‘public participation’ under article 10 of the Constitution and ‘appropriate consultations’ under section 5 of the Statutory Instrument Act 2013 (SIA) require in respect of the development of the Regulations?b.Was there compliance with the requirement for consultation under the SIA and/or public participation under the Constitution in making the Regulations?c.What amounts to ‘a matter arising under legislation that is substantially uniform or complementary with legislation of the national Government or any County’ within the exception undersection9(g) of the SIA so as to exclude the requirement for publication of a Regulatory Impact Statement (RIS) undersection6 of the SIA?d.What is the effect of non-compliance with the requirements for public participation and consultation; and/or the preparation of a proper RIS on the Regulations?e.What does the term ‘solatium compensatory contribution’ mean within section 7(2)(f) of the Act?f.What are the requirements for the determination of the ‘solatium compensatory contribution’ payable under section 7(2)(f) of the Act?g.Does section 7 (2)(f) of the Act provide for the imposition of an annual levy as contemplated by the Regulations?h.Does the solatium compensatory contribution specified in regulation 37 constitute a ‘tax or fee’ such that it violates article 210 of the Constitution?i.Is the wording of Regulation 37 that the solatium compensatory contribution shall be in every financial year the sum of two per cent of “the value” of the Tobacco products manufactured or imported impermissibly vague and uncertain so as to be incapable of compliance?j.Is the Requirement for payment of a solatium compensatory (solatium contribution) of 2% of the value of Tobacco products manufactured or imported as provided for under section 7(2)(f) of the Act as read together with Regulation 37 within the powers and Authorities conferred on the 1st Respondent, constitutional and proportionate?k.Is part v of the Regulations which seeks to directly implement the guidelines to article 5.3 of the FCTC to limit interactions between the Tobacco industry and public officers and public authorities, within the powers and authorities conferred on the 1st respondent to make regulations under section 53 of the Act?l.Is part v of the Regulations a violation of the Constitution, including articles 27 and 37 thereof, and otherwise invalid?m.Is regulation 15(b) which purports to ban smoking in “streets, walkways, verandas adjacent to a public place” within the powers and authorities conferred on the 1st Respondent to make Regulations undersection53 of the Act?n.How is article 24 of the Constitution to be applied by the court?o.Have the Respondents demonstrated that the requirements of article 24 of the Constitution have been satisfied in respect of any limitation of the fundamental freedoms caused by the Regulations?
25.The Petition is anchored on ten (10) grounds summarized as follows, that the Court of Appeal erred:i.In holding that there was adequate consultation and/or public participation in the process of making the Regulations.ii.In holding that the Regulations fall under the exception provided in section 9(g) of the SIA as they are complementary to the Act, and it was therefore not necessary for the 1st Respondent to prepare a RIS.iii.In holding that the Act and the Regulations are anchored on the Constitution and no inconsistencies arise.iv.In upholding section 7(2)(f) of the Act and regulations 37,38 and 39, which impose an annual payment (the solatium compensatory contribution) on the Tobacco industry.v.In failing to find that section 7 (2) (f) of the Act and Regulations 37, 38 and 39 are ultra vires the Act, unconstitutional and unlawful.vi.In presuming that the Regulations are per se lawful and compliant with due process, the Act and the Constitution because of the harmful effects of Tobacco, and in so doing justified clear violations of the Constitution and inconsistencies of the regulations with the Act.vii.In upholding Part V of the Regulations which severely restrict interactions between public authorities or public officers and the Tobacco industry.viii.In failing to find that Part V of the Regulations is ultra vires the Act, unconstitutional and unlawful.ix.In holding that regulations 12 to 14 which relate to product disclosure and industry disclosure are justified and reasonable.x.In holding that regulation 15(b) is not ultra vires the Act but seeks to give effect to section 32 of the Act.
IV. Parties’ Submissions
26.The appellant filed its written submissions on July 17, 2017 and submissions in reply on August 11, 2017, while the Affected Party filed its Submissions on July 31, 2017. The Respondents filed Grounds of Opposition on June 7, 2017 and written submissions on July 28, 2017, while the Interested Parties filed a Reply to the petition and later Submissions on 2July 8, 2017. This matter was orally canvassed before the Court on April 26, 2018 where parties were represented by counsel.
a) The appellant’s submissions
27.The appellant’s case was argued by Counsel, Mr. Kiragu Kimani who submitted that the appellant is not opposed to regulation of its activities and of the Tobacco industry but supports a regulatory framework that is constitutional, otherwise legal, balanced and evidence based, and which actually helps to achieve the intended public health objectives.
28.It was urged that pursuant to article 94(1) of the Constitution, the power to make law is vested in Parliament, and only the Constitution or Parliament through legislation can donate the power to any other person or body. Where Parliament has donated such power, like it does under section 53 of the Act, it must be exercised strictly within the limits of the legislation donating that power. It cited the case of Resley v The City Council of Nairobi[2006] 2 EA 311, where it was held that where Parliament has conferred powers on public authorities and has laid a framework on how the powers are to be exercised, and where that framework is clear, the public authority has an obligation to strictly comply with it, in order for its decision to be considered valid.
29.In that regard, it was urged that the Regulations herein must be under section 53 of the Act. It was submitted that for any set of Regulations to be legal, they must not only be consistent with the Constitution but also the parent Act under which they are made, and any other relevant Statute. This is in line with section 31(b) of the Interpretation and General Provisions Act which stipulates that “no subsidiary legislation shall be inconsistent with the provisions of an Act.”
30.The appellant urged that FCTC is a framework Convention that limits itself to the formulation of broad principles and objectives and that substantive rules are to be developed in later steps at international and domestic levels; such steps taken to implement the general principles must therefore be consistent with national laws. It submitted that the principles do not by themselves impose any legal obligations. As parliament is the legislating arm, it was urged, the legislation to implement the FCTC ought to be passed by Parliament and not the 1st Respondent as the case is alleged to have been in the present case.
31.The appellant categorized its submissions into two broad limbs, thus:1)Whether the process leading to the making of the regulations was unconstitutional or otherwise unlawful? and2)Whether some specific provisions of the regulations, and section 7(2)(f) of the TCA, are unconstitutional or otherwise unlawful?
Challenge on the Regulations making process
32.The appellant submitted that courts have a duty to prevent violation of the Constitution and the law, and may exercise this power to make orders that affect legislative process. It referred to the case of Doctors for life International v speaker of the National Assembly and others(CCT 12/05), (relied on in Robert N. Gakuru & others v Governor Kiambu County & 3 others[2014] eKLR) where it was held that:
33.The appellant invited the Court to examine the process leading to the making of the Regulations, whether it complied with the requirements under the Constitution and the SIA. It urged that the process was unconstitutional and unlawful as there was a failure to conduct appropriate and effective consultations, and a failure to prepare and publish a genuine RIS. It urged that meaningful public participation is a principle recognized by articles 10 and 118 of the Constitution as one of the principles of good governance. Section 5(1) of the SIA further requires a Regulation making authority to make appropriate consultations with persons who are likely to be affected by a proposed statutory instrument before making the statutory instrument.
34.It urged that the mandatory obligation of consultation and public participation is not met by merely taking the perfunctory step of involving the public and any affected persons, therefore the Court of Appeal erred in holding that there was adequate consultation and public participation. Relying on the case of Doctors for life, it was urged that for public participation and effective consultations to be said to have occurred,
35.Citing the case of Samuel Thinguri Waruathe & 2 others v Kiambu County Government & 2 others[2015] eKLR, it was urged that public participation and effective consultation are not a mere cosmetic venture. The product of the legislative process ought to be the true reflection of the public participation so that the end product bears the seal of approval by the public. It faulted the Court of Appeal in failing to note that while the appellant (BAT) volunteered written representations, it did not get any response and there is no evidence that the same was meaningfully considered. That from the minutes of the principal event it was clear that there had been no genuine consultations before making the Regulations and that the Respondents were advised to start the process afresh. It averred that the Court of Appeal erred in failing to find that the Respondents had pre-determined to introduce the Regulations and had a closed mind when engaging in the process of public participation, hence no genuine consultations. It was urged that the Respondents failed to give any conscientious consideration to the views expressed by the public, especially those of the Tobacco industry.
36.With this failure of meaningful consultations, it was urged that the Court finds the Regulations unlawful, null and void. Reference was made to the Constitutional Court of Uganda case, Constitutional Court Petition No 08 of 2014 Oloka-Onyango & 9 others v Attorney General[2014] UGCC 14 (cited with approval in Coalition for Reforms and Democracy (CORD) & another v Republic of Kenya & another [2015] eKLR) (CORD case) where it was stated thus:
37.It was further urged that section 6 of the SIA imposes an obligation on a Regulation making authority to prepare an RIS if a proposed Regulation is likely to impose significant costs on the community or part of a community. The appellant faulted the superior Courts for finding that in view of section 9(g) of the SIA, it was not necessary to publish an RIS, as the Regulations are complimentary to the Act. That this finding negated the objectives of the SIA, especially section 8. It faulted the Court of Appeal for not noting that the Respondents first agreed that the RIS was prepared but submitted that they did not publish it since it was not required. The appellant wondered why the same was prepared if it was not required in the first place. It urged that the Court of Appeal misdirected itself as to the scope of section 9(g) of the SIA and submitted that section 9(g) is a limited exception to be read narrowly and not to be applied broadly as the Court of Appeal did. The appellant submitted that the RIS is an essential part of transparent, accountable and empirically-based regulatory system as required under article 10(2)(c) and 47 of the Constitution. It provides a formal method for ensuring that administrative action is justified and based on a clear understanding of cause and effect.
Challenge on specific provisions of the Regulations and section 7(2)(f) of the Act
38.The appellant also impugned specific provisions of the Regulations for being unconstitutional or otherwise unlawful. section 7(2)(f) of the Act and regulations 37, 38 and 39 were said to be unconstitutional for imposing the Solatium Compensatory Contribution (Solatium). section 7(2)(f) of the Act provides that the Tobacco Control Fund shall consist of among others “a solatium compensatory contribution payable by any licensed cigarette manufacturers or importers in the country as may be determined by the Board.” Regulation 37 sets the solatium compensatory contribution at 2% of the value of the Tobacco products manufactured or imported by the manufacturer or importer in that financial year.
39.The appellant submitted that the Court of Appeal erred in finding that regulation 37 has a nexus with the Act. In this regard, it relied on the meaning of the term ‘solatium’ in the New Shorter Oxford English Dictionary on Historical Principles, vol. 2, thus:andIt was submitted that a solatium compensatory contribution is compensation payable for an established injury as opposed to a levy imposed on any activity or a service. An example of tis levy is to be found under section 105 of the Tourism Act. The appellant submitted that no connection has been shown between the annual levy and any wrong doing on its part or any Tobacco manufacturer or importer that occasioned an injury. Therefore, there is no reason given why it should be 2% as set.
40.It was argued that the Court of Appeal’s interpretation of the amount amounted to an ‘enlargement’ of the provisions of section 7 (2)(f) of the Act rather than its construction. It submitted that the imposition of the solatium compensatory contribution amounted to a deprivation of the appellant’s right to property under articles 40(1) of the Constitution. It was averred that article 260 of the Constitution defines property to include, “any vested or contingent right to, or interest in or arising from money, choses in action or negotiable interests.” Therefore, this solatium deprives the appellant of property without due process as no finding of wrong on the part of the appellant has been established.
41.It was contended that the solatium is a form of dedicated orhypothecated tax. In this regard it was submitted that section 7(2)(f) of the Act is not sufficient ‘legislation’ imposing a tax or fee as required under article 210 of the Constitution. It does not specify the amount of tax or the basis of calculating the tax sought to be imposed. In this regard, the appellant cited the case of Keroche Industries Limited v Kenya Revenue Authority & 5 others[2007] eKLR, where Nyamu, J observed that:
42.The appellant submitted that the finding on the contribution of 2% of the Tobacco products manufactured or imported was not supported by any evidence, hence failed the necessary standard under article 24 of the Constitution. It was argued that article 24 requires an assessment of whether the limitation is reasonable and justifiable having regard to the matters set out in article 24(1) and also with respect to article 24(2). It was argued that with no RIS, the Respondents have not shown that the requirements of article 24 have been met. Accordingly,, it was urged that the solatium does not satisfy any of the criteria of proportionality. It is arbitrary, capricious and violates due process. It imposes an onerous and unjustified burden on the appellant, when Tobacco manufacturers and importers are already subject to many other taxes. For that reason, the appellant argues that the Court of Appeal erred in not finding that the contribution violates article 24 of the Constitution.
43.It was further submitted that the solatium violates articles 10(1) and 47 of the Constitution. Citing the case of Crywan Enterprises Limited v Kenya Revenue Authority,[2013] eKLR, it was urged thatTherefore, the determination of this contribution is not based on any reason, it is done without procedural propriety and is ipso facto, arbitrary and amounts to unlawful exercise of jurisdiction. Also cited in this regard are the cases of Trusted Society of Human Rights Alliance & 3 others v Judicial Service Commission & others[2016] eKLR, A.G v Ryan(1980) A.C. 718 and Law Society of Kenya v Attorney General & another[2009] eKLR.
44.Invoking International law, the appellant urged that the solatium compensatory contribution violates the East Africa Community Treaty as it hampers free movement and trade of cigarettes between Kenya and other Treaty Members. It argued that under the Treaty, State Parties are obliged to remove obstacles to the free movement of goods, services and capital. Subsequently, it was urged that as the solatium applies to exports, it will impact on this cross-border trade.
45.The appellant questioned why the solatium has been pegged at 2% of the value of Tobacco products manufactured or imported. The appellant states that such value is vague and impossible to ascertain. Because of this vagueness, the appellant, is unable to regulate its conduct and is exposed to potential criminal prosecution under regulation 45 for contravention of the Regulations. Cited in this regard was the case of Aids Law Project v The Hon. Attorney General & 3 others,[2015] eKLR thus:
46.It was urged that while the health consequences of Tobacco are relevant, those consequences do not negate the obligation to comply with the law in making Regulations, including undertaking the necessary balancing exercise required under article 24 of the Constitution.
47.Part v of the Regulations that limits interaction between public authorities or officers and the Tobacco industry was impugned as being unconstitutional, having been made without authority, and otherwise unlawful. It was urged that the Court of Appeal erred in finding that Part v of Regulations was made within the scope of the powers of the 1st Respondent. The appellant submitted that section 53 of the Act does not confer a broad power on the 1st Respondent to make Regulations that modify or extend the Act, but the power is strictly limited to ancillary matters within the existing framework laid down in the Act. It cited Utah Construction & Engineering Pty Limited v. Pataky(1966) A.C. 629 where the Privy Council adopted with approval the statement in the judgment of the High Court of Australia in Shanqhan v Scott relating to the construction of a provision which provided for the making of Regulations that are necessary or convenient for carrying out or giving effect to the Primary Act, thus:
48.It was submitted that there is no provision in the Act for the Regulation of interactions between public authorities and none of the objects of the Act prescribes the restriction of interactions between public authorities and the Tobacco industry. It was urged that Part V of the Regulations could not have been made pursuant to the powers in section 53 of the Act. It was submitted that this was an attempt to implement article 5.3 of the FCTC and the Guidelines, yet there is no power under section 53 of the TCA to implement the FCTC or the guidelines.
49.The Court of Appeal was faulted for finding that the inequality of treatment in limiting interaction between the public officers and or authorities and members of the Tobacco industry does not amount to discrimination and is justifiable under article 24 of the Constitution. It was submitted that the Court of Appeal erred in finding that the Tobacco industry cannot expect equal treatment with other industries in relation to its interactions with public authorities and or officers: no other industry, including those dealing with other harmful products, is subjected to similar limitations in their interactions with the public authorities and or officers, or exclusion from lawful business incentives that may be available to other industries.
50.It was further urged that Part V of the Regulations does not satisfy any of the criteria of proportionality because any concerns regarding the protection of the public health policies with respect to Tobacco Control can be met by the implementation of appropriate provisions that promote government transparency so that the public knows who is lobbying regulators for what outcomes, and by the implementation of sensible-conflict-of-interest rules, while not requiring the wholesale exclusion of the Tobacco industry.
51.The Court of Appeal, it was contended, erred in limiting Intellectual Property Rights (IP) and the right to privacy under Regulations 12, 13 and 14, which is not justifiable under article 24 of the Constitution. While the Court of Appeal held that Regulation 12 limits the appellant’s IP rights, it was submitted that it erred by holding that the limitation is reasonable and justifiable under article 24 of the Constitution without providing any analysis of how the criteria laid down in article 24 are met. It is urged that the disclosures required by Regulations 12, 13 and 14 include trade secrets, manufacturing processes and other IP rights, and that article 40(2)(a) of the Constitution prohibits Parliament from enacting a law that permits the State to arbitrarily deprive a person of property of any description or of any interest in, or right over, any property of any description. Under article 40(5), the State is obligated to support, promote and protect the IP rights of the appellant, and therefore the disclosure required by the Regulation may result in the deprivation of the appellant’s IP rights.
52.Lastly, it was urged that Regulation 15(b) is ultra vires the Act. This Regulation provides that no person shall smoke in streets, walkways or verandas adjacent to a public place. The appellant submitted that the streets and walkways are not designated public places under the Act and Regulation 15(b) and could not give effect to section 32 of the Act. Hence, the Court of Appeal erred in failing to find that this Regulation is ultra vires the powers and authority of the 1st Respondent under the Act.
b) Affected Party’s Submissions
53.Counsel Mr. Macharia argued the case of the Affected Party, Mastermind Tobacco Kenya Limited before the Court. It had filed its written submissions on 31st July 2017 in which it agreed with and supported the appellant’s case. It submitted that it is the only indigenous company in East and Central Africa and that the Regulations would destroy the local Tobacco industry.
54.It reiterated the submissions of the appellant concerning lack of due process, particularly that of public participation, in the making of the Regulations contrary to the Constitution and the SIA. It contended that it was not appropriately consulted on the Regulations and the representations it made on its own motion on previous drafts were not responded to and there is no evidence that they were meaningfully and genuinely considered. Further, that there is no evidence of the involvement of experts and or a representation from a cross- section of the public in preparation of the Regulations. It also decried the lack of or failure to publish an RIS by the 1st Respondent as required by the SIA.
55.The Affected Party also urged that the solatium was illegal and amounted to taxation without representation. It argued that it is ultra vires the power and authorities under the Act and it is unclear as to the mechanism used to compute, raise, collect and disburse the fund. Counsel argued that the solatium therefore, amounts to unlawful imposition of tax or fee contrary to article 210 of the Constitution. In this regard, it reiterated that the solatium is a tax, yet imposition of tax or licensing fee is not provided for by section 7(2)(f) of the Act. It further urged that the imposition of such a tax was without due process of the law, that is, without determination of a wrong on the part of the Affected Party that caused injury to the State, or damages suffered by the State. It is therefore unlawful and amounts to taking of the Affected Party’s property rights under article 40 of the Constitution. Further, there is no determination of a legitimate purpose of the solatium and as such, the imposition of the solatium violates articles 10(1) and 47 of the Constitution.
c) Respondents’ submissions
56.The Respondents’ case was argued by Counsel Mr. Adan. The Attorney General had filed its submissions on 28th July, 2017. It had also filed Grounds of Opposition on 7th July 2017. In arguing their case, the Respondents submitted that the appellant and the Affected Party were merely re-litigating their case and it was not shown how the Court of Appeal misapplied the law.
57.It was submitted that the process of making the Regulations was strictly in accordance with the SIA as captured in the Replying Affidavit of Mr. James W. Macharia dated July 28, 2015, a fact also found by the Superior Courts. They also urged that the Regulations were exempted from the need for a RIS under section 9(g) of the SAI.
58.It was urged that the Regulations are consistent with the Parent Act and that under section 53 of the Tobacco Control Act, 2007, the Cabinet Secretary for Health, on the recommendations of the Tobacco Control Board, is empowered to make Regulations for the purpose of realizing the objects of the Act. It was submitted that in determining whether the Regulations are inconsistent with the Parent Act, where the dispute relates to the application of an international treaty, article 2(5) & (6) of the Constitution and article 31 of the Vienna Convention on the Laws of Treaties, 1969 should be the guide. They urged that in determining the legality of the Regulations, they must be subjected to the four corners of the Parent Act. The decision of the Supreme Court of India in Maharashtra State Board of Secondary’ & Higher Secondary’ Education v Kurmarsheth & others1985J LRC (Const), which case was cited by the Court of Appeal in Nature Foundation Limited v Minister for Information and Communication & another[2015] eKLR was submitted to be instructive on this. In that case it was stated:
59.Counsel further cited the case of U.S v Butler, 297 U.S. 1 [1936] where it was held that,Also cited were R v Big M Drug Mart Ltd, [1985] 1 S.C.R. 295 and Ndyanabo v s Attorney General of Tanzania[2001] EA 495 in urging that there is a presumption that every Act of Parliament is constitutional, and the burden of proving the contrary lies on the one who alleges otherwise.
60.They submitted that the Court should strive to interpret the provisions of the Regulations in a manner that will realize the intention of the Legislature: to regulate and control the growth, sale, distribution and consumption of Tobacco and its products. They argued that there is need for a liberal and intentional based approach and that in interpreting a Statute or Regulations, the Court should adopt a purposive approach to achieve the real purpose as was laid down in Heydon’s Case(1584) 300 where it was stated that in the application of this rule, four things are to be discerned: what was the law before enactment of the Act; what was the mischief or defect for which the old law did not provide; what remedy the Act or Law intended to cure the mischief or defect; and the true reason of the remedy.
61.The Respondents urged that the Regulations should be construed in a manner that enhances the purpose or objectives for which the same are enacted for. They argued that the burden of proof lies with the appellant and the affected party to show that the regulations are inconsistent with the Parent Act and the Constitution, and that the regulations violate their rights. It is not enough to say that the Regulations are ambiguous or unconstitutional as the Regulations were arrived at through a consultative process.
62.They explained that the Regulations are divided into 8 parts, and that each is in conformity with the relevant section s of the Act. The Respondents then proceeded to link each Part of the Regulations and the particular section s of the Act it conformed with. They submitted that Part II of the Regulations conforms to section s 16, 21, 22, 23, 24, 25 & 26 of the Act and that Part III of the Regulations is in conformity with section 4 of the Act. It was submitted that the disclosures required are meant for counteractive measures to control and mitigate Tobacco related problems. The Respondents argued that the disclosure is reasonable and justifiable in an open and democratic society based on the Bill of Rights, human dignity, equality and freedom. This disclosure is directly supported by guidelines for implementation for article 10 of the WHO FCTC (disclosure to government authorities), and article 20.2 of the WHO FCTC (national health surveillance).
63.Part IV of the Regulations was submitted to be in conformity with section s 32, 33, 34 & 35 of the Act. Part V conforms to chapter 6 of the Constitution, the Act, the Public Officer Ethics Act, 2003, the Leadership and Integrity Act and article 5.3 of the WHO FCTC and guidelines. Part VI of the Regulations which provides for the 2% Solatium is in conformity with section 7(2)(f) of the Act and article 6 of the WHO FCTC and is meant to cater for the health perils caused by Tobacco use. The Respondents urged that the solatium is not unconstitutional and is just like any other levy such as tourism levy fund under section 105 of the Tourism Act, cap. 383. They urge that the Tobacco Control Act was enacted in 2007 through public participation processes and section 7(2)(f) was operationalized by the Regulations.
64.It was urged that the Petition does not meet the threshold as per the principles in Anarita Karimi Njeru vs the Republic(1976-1980) KLR 1272 as the appellant failed to show even a single right that was violated and the manner in which that right had been violated or even threatened. The Respondents wondered how Regulations which they believe are lifesaving and beneficial to the public violates the rights of any one including the appellant.
65.As regards allegation of violation of the right to property, the Respondents cited among others, the case of Richard Dickson Ogendo & 2 others v Attorney General & 5 others[2014] eKLR, where Majanja J held:In that regard, it was submitted that the Regulations do not prevent people from smoking, they simply regulate how and when it can be done; this does not amount to a constitutional violation. It was urged that the Learned Judges of the Superior Courts did not misapply the law or the facts in arriving at their decisions.
66.Submitting on public interest protection, it was urged that whereas there are no hierarchy of rights, there has to be a balance between the competing rights of the appellant, which are not absolute and are driven by profits, and the greater public health interests in a mutually respectable manner. As such, there are instances where some private rights and interests have to give way to greater public rights and interests. The Respondents argued that the appellant makes no submission on the right to health vis a vis it’s rights. The right to health is one of the most fundamental human rights which were a primary concern in developing the WHO-FCTC. Article 21(2) of the Constitution, in mandatory terms, demands the State to provide legislative, policy and other measures to achieve rights guaranteed under articles 42 and 43 of the Constitution, including the right to a clean and healthy environment, and the right to the highest attainable standard of health. To buttress this argument, the Respondent cited East African Cables Limited vs The Public Procurement Complaints, Review & Appeals Board and another(2000) eKLR.
67.They urged that Tobacco Control and Regulation is a global practice and Kenya being a respectable member of the International Community and a Party to WHO FCTC cannot be exceptional. The purpose of the Regulations is to protect the global- citizens those-who-smoke and those-who-do-not, from the harmful effects of Tobacco consumption and use, by informing them the effects of the same. The WHO Framework Convention on Tobacco Control (FTCT), the first-ever public health treaty, provides a framework and set of legally-binding measures to be implemented in countries that have ratified it and is an evidence-based treaty that affirms the right of all people to the highest standard of health. The Respondents submitted that under article 2 (6) of the Constitution, Kenya is a signatory to the WHO FCTC, is duty bound to fulfil its obligations under the FCTC by enacting and implementing FCTC compliant legislations and Regulations.
d) 1st and 2nd Interested Parties’ submissions
68.Their case was argued by Counsel Mr. Nyamweya. They filed a Reply to the Petition and Submissions on 28th July 2018. They supported the Respondents in opposing the petition of appeal. It was their case that there was adequate public participation in the process of making Regulations. They submitted that there is no specific style in which public participation is to be modeled on. They cited the case of Minister of Health v New Clicks South Africa (PTY) Ltd(2006) (2) SA in urging that the forms of facilitating an appropriate degree of participation in the law-making process are indeed capable of infinite variation.
69.They urged that the complaint is neither that the appellant was not consulted nor denied the opportunity to take part in the deliberations about the proposed Regulations. Its complaint is that, it should have been consulted as a specific entity. In this regard, they submit that public participation is for everyone and not an exclusive province of a solitary person or corporation however influential or large. They referred to the case of Merafong Demarcation Forum v President of the Republic of South Africa[2008] ZACC 10 and submitted that a person consulted or who participated in the forum would air his or her views but the prerogative to adopt them remains with the law-making body. Where the views expressed by members of the public or those interested in the matter are in direct conflict with the policies of the government, such views cannot be said to be binding on the law-making authority.
70.They agreed with the Respondents that the Regulations are exempted from the need for RIS under section 9(g) of the SIA as they were complimentary to the Act.
71.They submitted that the appellant misconstrued the Superior Courts’ judgments on the effect of Tobacco products. They urged that the Courts were emphatic that the negative effects of Tobacco necessitated the promulgation of the Regulations. Hence, the State’s discharge of its duty to secure and promote health cannot be said to be a violation of private rights. They referred to the case of British American Tobacco & Philip Morris v Secretary of State for Healthin which the Court held that when it comes to matters of public health, States have power to take pecuniary measures to protect their citizens; this is what the Tobacco Regulations, 2014 seeks to do.
72.It was their case that the Superior Courts correctly directed themselves on the standard to be applied in considering the conformity of legislation with the Constitution as espoused in the CORD v Rcase, and article 259 of the Constitution which standard is: promotion of the purposes, values and principles of the Constitution; advancement of the rule of law; promotion of human rights and fundamental freedoms in the Bill of Rights; securing good governance; and adopt a liberal purposive approach. Public interest is at the core of the existence of the Regulations and the appellant’s rights are therefore diametrically in competition with those of the public.
73.It also urged that as Lenaola, J (as he then was) stated in Nairobi Metropilitan PSV Saccos & others v County of Nairobi government & others, it is not for the court to decide what is appropriate or right or wise legislative provision. As was stated in Poverty Alleviation Network & others v President of the Republic of south Africa & others[2010] ZACC 5, a court cannot interfere with legislation simply because it may disagree with its purpose or believes that it should be achieved in a different way. Therefore, the Court should not entertain the appellant’s attack on the Regulations on account of bad faith, pre-determined motives and vindictiveness. The Interested Party submitted that the Regulations meet all the tests enunciated in the CORDcase, that is: they have been prescribed by the Parent Statute and are part of it; they are clear; their objective is pressing and the problem they are aimed at addressing is substantial; they are proportionate to the magnitude of the effect of Tobacco on health.
74.As regards the constitutionality of specific provisions of the Regulations, they agreed with the submissions of the Respondents that Regulations limiting interactions between Tobacco industry and public officers are constitutional as they flow from the ethic and integrity requirements in chapter 6 of the Constitution, the TCA, Public Officers Ethics Act and the Leadership and Integrity Act, article 5.3 of the WHO Framework Convention and the Guideline thereto. It was urged that the Regulations are aimed at achieving effectiveness of the Tobacco control legislation that is free of conflict of interest amongst the enforcement and administration officers.
75.They submitted that the power of the 1st Respondent to make these Regulations flows from section 53 of the Act. The enactment of the Act was in fulfilment of Kenya’s obligation under the WHO FCTC which Kenya ratified on 25th June, 20o4. The same is also anchored in the Constitution under article 2(6) of the Constitution. Further, that the Regulations are not discriminatory as they affect all the players in the industry and do not target only the appellant and the Affected Party.
76.They agreed with the Court of Appeal findings on the solatium and submitted that it is in accordance with section 7 of the Act and not ultra vires. It does not violate article 210 of the Constitution as it is not a tax or fee levied by the National or County government for purposes of National or County revenue. It does not amount to deprivation of the appellant’s property. It is a payment that will be paid by all Tobacco manufacturers and importers. It will not solely come from the appellant, hence not discriminatory.
77.They also submitted that the Court of Appeal was right in its findings as regards the disclosure Regulations, that the State has a duty to secure and promote the health of its citizens and that the discharge of that duty cannot and can never be said to be in violation of private rights. Private rights include those protected under municipal law and international law can legally be overridden by public interest consideration. Finally, they urged that the petition be dismissed with costs.
e) Appellant’s Reply
78.Upon the Respondents and the Interested Parties filing their Written Submissions on July 28, 2017, the appellant filed its Submissions in Reply on August 11, 2017 responding to each and every submission made by the Respondents and reiterate its submissions in support of the Appeal. They reiterated that the process of making the Regulations was flawed and that there is no public interest in violating rights and fundamental freedoms in the Constitution. Therefore, the Respondents cannot justify using that argument. Further, Mr. Kiragu urged that if the Court finds that it is inclined to uphold the Court of Appeal, it should give directions as to when the directions should take effect. He urged that preferably, the Court should order that the Regulations become operational after 6 months of the judgment.
V. Issues For Determination
79.In the Petition, the appellant framed ten (10) issues for determination, which in its written submissions, it summarized into two broad issues as follows:(1)Whether the process leading to the making of the Regulations was unconstitutional or otherwise unlawful? and(2)Whether some specific provisions of the Regulations, and section 7(2)(f) of the TCA, are unconstitutional or otherwise unlawful?
80.On their part, the Respondents, through the Attorney General’s Written Submissions filed on 28th July, 2017 framed four issues for determination in the following terms:(a)Whether the processes of making the Regulations was in accordance with the Statutory Instruments Act, 2013?(b)Whether the Regulations are inconsistent with the Parent Act, i.e the Tobacco Control Act of 2007?(c)Whether the appellant’s Petition meets the threshold test of constitutional proof as per the Principles in Anarita Karimi Njeru vs The Republic (1976-1980) KLR 1272? and(d)Whether the Hon. Judges misapplied the law and the facts before them in arriving at the judgment of 17th February, 2017?
81.While parties may propose issues for determination in a matter before the Court, it is the unfettered prerogative of the Court to delimit the issues for determination that it will consider a matter before it. Consequently, the Supreme Court is not bound by the issues as framed by the parties.
82.Before delimiting the issues for determination in this case, however, we would like to underscore the jurisdiction under which this matter is determined. The appellant’s case is anchored on article 163(4)(a) of the Constitution, that is, it has appealed to this Court as of right that its matter “involves issues of constitutional interpretation and application”. We reiterate that under article 163(4)(a) of the Constitution, not every case or issue determined by the Court of Appeal falls for appeal to this Court. InGladys Wanjiru Munyi v Diana Wanjiru Munyi,[2015] eKLR,this Court reiterated its earlier jurisprudence [Paragraph 12] thus:
83.It follows that even where it is established that a matter or issue was before the High Court and rose to the Court of Appeal, that matter or issue does not automatically qualify for appeal before the Supreme Court under article 163(4)(a) of the Constitution. The Court is under an obligation to undertake a forensic audit and sieve out matters so that only issues that rightfully involve the interpretation and or application of the Constitution are presented and determined by the Supreme Court. Consequently, while the appellant, and to some extent the Respondents, have addressed this Court on a number of issues in this case, the Court warns itself that some of these issues do not fall for determination before this Court in exercise of its appellate jurisdiction under article 163(4)(a) of the Constitution. This is the foundation upon which we proceed to frame the issues for determination in this matter.
84.Consequently, upon a thorough appraisal of the matter before us, and guided by the issues framed for determination before us by both the High Court and the Court of Appeal, the following issues rightfully crystallize for determination:(i)Whether the process leading to the making of the Tobacco Regulations 2014 was unconstitutional for lack of public participation?(ii)Whether specific provisions of the Regulations are unconstitutional for being discriminatory as against the appellant?(iii)Whether specific provisions of the Regulations violate the appellant’s right to privacy and infringe on Intellectual Property rights?(iv)Whether the imposition of the Solatium compensation contribution amounts to unlawful taxation?(v)What are appropriate reliefs?
VI. Analysis And Determination
(i) Whether the process leading to the making of the Tobacco Regulations 2014 was unconstitutional for lack of public participation and consultation ?
85.Public participation has been entrenched in our Constitution as a national value and a principle of governance under article 10 of the Constitution and is binding on all State organs, State officers, public officers and all persons whenever any of them: (a) applies or interprets the Constitution; (b) enacts, applies or interprets any law; or (c) makes or implements public policy decisions. As aptly stated by the Appellate Court, public participation is anchored on the principle of the Sovereignty of the People “that permeates the Constitution and in accordance with article 1(4) of the Constitution is exercised at both national and county levels”.
86.Article 118 of the Constitution provides for public participation in the legislation making process, as follows:
87.Since the promulgation of the Constitution 2010, the question of the rationale, scope and application of public participation as a principle of governance has been subject of numerous decisions by the courts. The High Court in this matter appraised itself of the various decisions on the same, which appraisal the Court of Appeal readily endorsed. In the Matter of the National Land Commission,the Supreme Court placed the principle of public participation at the core of the concept of checks and balances in governance in the execution of their functions by the various arms of government, when we stated:
88.The Retired Chief Justice, Dr. Willy Mutunga, in his concurring opinion expounded on the principle and traced the place of the People in the Constitution making process thus:
89.The Rtd Chief Justice drew from caselaw on the principles for public participation in various court decisions including Speaker of the Senate & another v. Attorney General& 4 others Sup. Ct. Advisory Opinion No 2 of 2013; [2013] eKLR; Thuku Kirori & 4 others v. County Government of Murang’a Petition No 1 of 2014; [2014] eKLR; Nairobi Metropolitan PSV Saccos Union Limited & 25 others v County of Nairobi Government & 3 others Petition No 418 of 2013; [2013] eKLR; and Robert N. Gakuru & others v. Governor Kiambu County & 3 others, Petition No 532 of 2013 consolidated with Petition Nos. 12 of 2014, 35, 36 of 2014, 42 of 2014, & 72 of 2014 and JudicialReview Miscellaneous Application No 61 of 2014;[2014] eKLR [Robert Gakuru case](Most of these cases were also referred to by the High Court in this matter). He also referred to the jurisprudence from the South African Constitutional Court decision, Doctors for Life International v. Speaker of the National Assembly and others[2006] ZACC 11; 2006 (12) BCLR 1399 (CC); 2006 (6) SA 416 (CC) which also considered the role of the public in the law-making process.It in part stated as follows:
90.Earlier on, the Supreme Court had reiterated the centrality of public participation as regards the issue of digital migration, in the case of Communications Commission of Kenya & 5 others v Royal Media Services Limited & 5 others,[2014] eKLR. We stated inter alia:
91.The High Court in this matter, as observed by the Court of Appeal, appropriately referred to several decisions on public participation and consultation. All these cases are illuminating on the place of public participation in governance under the Constitution 2010.
92.In Republic v Independent Electoral and Boundaries Commission (I.E.B.C.) Ex parte National Super Alliance (NASA) Kenya & 6 others Judicial Review No 378 of 2017; [2017] eKLR among the issues for consideration before the High Court was whether the IEBC was constitutionally obliged to facilitate public participation as part of the tendering process. The High Court allowed the Petition and quashed the award of the tender for lack of public participation. It ordered that the procurement process begin de novo in accordance with the Constitution. IEBC appealed to the Court of Appeal. In upholding the appeal, setting aside the High Court decision, the Court of Appeal considered the big issue of justifiability and enforceability of article 10 of the Constitution, which encompasses the principle of public participation. The appellate court in Independent Electoral and Boundaries Commission (IEBC) v National Super Alliance(NASA) Kenya & 6 others,Civil Appeal No 224 of 2017; [2017] eKLR held that article 10(2) and the principles therein are for immediate realization, thus:We agree with this pronouncement and reiterate that the principle of public participation as anchored in article 10 of the Constitution is alive and the same is equally justiciable before our courts.
93.While the Court of Appeal in the above matter was dealing, particularly, with the question of the place of public participation in procurement, its pronouncement is illuminating on the principle of public participation in general. Having appraised several decisions on the issue, the Appellate Court stated thus:
94.Finally, the Court of Appeal found that subject to a few stated exceptions, public participation was a mandatory requirement in all procurement done by a public entity. As regards lack of a framework on how to achieve public participation the Court observed:
95.Indeed the High Court, Odunga J, in Robert N. Gakuru & others v Governor Kiambu County & 3 others[2014] eKLR, in which case the Learned Judged extensively borrowed from the South African jurisprudence in Doctors for Life International vs. Speaker of the National Assembly and Others,illuminated the law of public participation. He emphasized on the seriousness with which public participation should be undertaken:
96.From the foregoing analysis, we would like to underscore that public participation and consultation is a living constitutional principle that goes to the constitutional tenet of the sovereignty of the people. It is through public participation that the people continue to find their sovereign place in the governance they have delegated to both the National and County Governments. Consequently, while Courts have pronounced themselves on this issue, in line with this Court’s mandate under section 3 of the Supreme Court Act, we would like to delimit the following framework for public participation:Guiding Principles for public participation(i)a constitutional principle under article 10(2) of the Constitution, public participation applies to all aspects of governance.(ii)The public officer and or entity charged with the performance of a particular duty bears the onus of ensuring and facilitating public participation.(iii)The lack of a prescribed legal framework for public participation is no excuse for not conducting public participation; the onus is on the public entity to give effect to this constitutional principle using reasonable means.(iv)Public participation must be real and not illusory. It is not a cosmetic or a public relations act. It is not a mere formality to be undertaken as a matter of course just to ‘fulfill’ a constitutional requirement. There is need for both quantitative and qualitative components in public participation.(v)Public participation is not an abstract notion; it must be purposive and meaningful.(vi)Public participation must be accompanied by reasonable notice and reasonable opportunity. Reasonableness will be determined on a case to case basis.(vii)Public participation is not necessarily a process consisting of oral hearings, written submissions can also be made. The fact that someone was not heard is not enough to annul the process.(viii)Allegation of lack of public participation does not automatically vitiate the process. The allegations must be considered within the peculiar circumstances of each case: the mode, degree, scope and extent of public participation is to be determined on a case to case basis.(ix)Components of meaningful public participation include the following:a.clarity of the subject matter for the public to understand;b.structures and processes (medium of engagement) of participation that are clear and simple;c.opportunity for balanced influence from the public in general;d.commitment to the process;e.inclusive and effective representation;f.integrity and transparency of the process;g.capacity to engage on the part of the public, including that the public must be first sensitized on the subject matter.
97.With the above legal framework on public participation, we now proceed to consider whether the Tobacco Regulations 2014 are unconstitutional for limited or lack of public participation in the process leading to their enactment. In making this determination, we reiterate that we are limited to issues of constitutional interpretation and/or application only.
98.Upon evaluation of the Court of Appeal judgment, we find that the Appellate Court rightly appreciated the constitutional principle of public participation. The Court of Appeal endorsed the High Court’s analysis on several decisions on the issue, which we have also endorsed in this Judgment. We find that the Court of Appeal did not err in its findings on the meaning, scope and application of the principle of public participation. Having noted the law, the Court of Appeal considered the High Court’s application of the affidavit evidence on record to the stated law and concluded that: “ given the facts that were before the learned judge, we have no reason to fault the learned judge for finding that the stakeholder meetings, discussions and communications constituted adequate public participation and consultation.” We find and hold that there is nothing of constitutional interpretation and/or application in this finding, and/or conclusion by the Court of Appeal on how the High Court evaluated the Affidavit evidence before it. Consequently, that issue rests as before this Court.
99.The second ground upon which the Regulations making process was impugned was due to lack of a Regulatory Impact Statement (RIS). While parties submitted at length on the issue before this Court, we find that issue is not for consideration by this Court under article 163(4)(a) of the Constitution. As submitted by both parties the requirement for an RIS is provided for by the Statutory Instrument Act. It is statutory anchored. Hence, the question(s) as to whether the same was required, exempted and/or published involves evaluation and interrogation of factual evidence; and a reading and interpretation of the Statutory Instruments Act. All these are issues that fall well within the jurisdiction of the High Court and the Court of Appeal. However, they fall outside the jurisdiction of this Court as there is nothing of constitutional interpretation and or application to invoke this Court’s jurisdiction under article 163(4)(a) of the Constitution. It is not being argued that the SIA itself is unconstitutional for requiring and/or waiving the requirement of an RIS. Therefore, the Court of Appeal’s finding on this issue rests before this Court.
(ii) Whether specific provisions of the Regulations are unconstitutional for being discriminatory as against the appellant?
100.In this regard, what was impugned was Part V of the Regulations (20-36) which limits interactions between the Tobacco industry and public officers and or authorities. The appellant argued that this limitation infringes on article 27 of the Constitution that guarantees the right to equality and freedom from discrimination. In its judgment, the Court of Appeal agreed that a look at this Part V of the Regulations indeed showed that they were discriminatory. However, the Appellate Court were of the opinion that not all discrimination was unfair. It was persuaded by the case of President of the Republic of South Africa & Anor vs. John Philip Hugo 1997(4) SAICC para 41, wherein it was stated:
101.Also cited was the case of Federation of Women Lawyers Fida Kenya & 5 others vs. Attorney General & anor[2011] eKLR where it was held that:
102.We are in agreement that not all forms of discrimination are unfair. Each case where discrimination is alleged has to be evaluated on its own peculiar facts. It is worth noting that the rights under article 27 of the Constitution, equality and freedom from discrimination are not non-derogable rights under article 25 of the Constitution. They are subject to the limitation clause under article 24 of the Constitution. To this end, we agree with the appellant that in limiting their rights under article 27, the same can only be done if the principles in article 24 have been met. The article provides:
103.Comparatively, the Constitutional Court of South Africa in S v Manamela and another (Director-General of Justice Intervening)(CCT25/99) [2000] ZACC 5 had a chance to interpret section 36 of the South African Constitution, which is pari materia to article 24 of the Kenyan Constitution. That Court stated:
104.We have evaluated the findings of the Superior Courts on this issue. The High Court found that the limitation was justified and that it was within the mandate of the CS Health to make the Regulations. It stated:
145.The intention behind this limitation is, in my view, to ensure effective enforcement and implementation of the Tobacco control laws. It accords with the provisions of article 24 of the Constitution as it allows differentiation in interactions with public officers between the Tobacco industry and other industries which is permissible under the Constitution.”
105.In reaching her decision, the Learned Judge was persuaded by the decision of State of Kesata and another vs N.M. Thomas and others,1976 AIR 490, 1976 SCR (17906):
106.The Learned Judge was also persuaded with the dictum in S vs Makwanyane and another, CCT 3/94 (1995) 2A CC3as regards limitation of rights thus:
107.On appeal, the Court of Appeal upheld the High Court stating:
108.We are persuaded that it is not enough for the appellant to generally state that the requirements in article 24 have not been met in limiting the rights under article 27. Those factors are not exhaustive but are mutually inclusive. They have to be evaluated from within the society within which the Regulations are meant to operate. We disagree with the appellant that the Superior Courts were wrong in taking into consideration ‘extraneous factors’ such as the effects and ills of the Tobacco use on the health of the users in justifying the discrimination, that is, the limitation of the contact between Tobacco manufacturers and public officers. We find that there is no way the Regulations can be legitimately made without the CS for Health factoring in the consequences and/or impact of Tobacco use. Such an approach will be akin to the proverbial ostrich burying its head in the sand. In any event, the effects of Tobacco are now subject of much national and international documentation and discussions.
109.Ultimately, we find that the Superior Courts correctly rendered themselves on the limitation of the appellant’s right of association as regulated by Part V of the Regulations. The appellant’s appeal on this issue before this Court therefore fails.
(iii) Whether specific provisions of the Regulations violate the appellant’s right to privacy and infringe on Intellectual Property rights?
110.It was the appellant’s case that Part III of the Regulations (12-14), on disclosure of information infringed on its right to privacy and Intellectual Property. It maintained that the disclosures required include, trade secrets, manufacturing processes and other intellectual property rights. The High Court in its judgment weighed the appellant’s intellectual property rights vis-à-vis the public rights and held:Therefore, the High Court found that the Part of the Regulations requiring disclosure was justifiable, save for the part requiring the supply of information relating to their market share, which was found to be unreasonable.
111.On appeal, the Court of Appeal agreed with the High Court finding:
112.The Superior Courts considered the balance between the appellant’s intellectual property rights and the need to protect the public health from the effects of Tobacco use. At play was the balance that has to be drawn in considering competing rights. The concept of competing rights calls for utilization of the doctrine of proportionality so as to resolve the tension between such rights where it arises.
113.This concept of competing rights and how to harmonize that tension was well articulated by the High Court, Mativo J, in Kenya National Commission on Human Rights & another v Attorney General & 3 others[2017] eKLR; thus (which we reproduce at length):
114.Comparatively, the Constitutional Court of South Africa in the case of Johncom Media Investments Limited v M and others(CCT 08/08) [2009] ZACC 5, had the following to say as regards dealing with competing rights:
115.Persuaded by the foregoing case law, we find that the Court of Appeal correctly applied the test of proportionality in resolving the friction between the competing rights of the appellant’s right to its intellectual property vis-à-vis the need to ensure a safe and clean environment, free from the hazards of Tobacco use, for the public. Consequently, we find no reason to upset the Court of Appeal findings on the issue.
(iv) Whether the imposition of the Solatium Compensation Contribution amounts to unlawful taxation?
116.Several aspersions were cast as regards the Solatium compensation contribution. It was the appellant’s case that the same is a tax and as such having not been passed by Parliament, the arm of government charged with legislating for taxation under article 210 of the Constitution, it is therefore unconstitutional. Further that its imposition amounts to deprivation of property of the appellant and that it was neither adequate and/or proportionate.
117.First, we would like to state that to the extent that the Solatium compensation contribution is provided by subsidiary legislation, it does not raise a constitutional question within the realm of article 163(4)(a) of the Constitution. As correctly pointed out by the Court of Appeal, the Parent Act, provides for the Tobacco Control Fund to which the Solatium compensation contribution is paid. That Statute has not been impugned as being unconstitutional. For this Court to interrogate whether the Solatium is adequate and proportionate, it must first determine whether it is indeed a tax. Taxation is a subject matter provided for by the Constitution. However, if it is found that the Solatium is just a fee or a levy, then it is provided for within a legislative framework and therefore not a matter of constitutional issue.
118.The High Court did consider the narrow issue of the constitutionality of section 7(2)(f) and Regulation 37 which created the Solatium Compensatory Contribution and set the amount to be paid thereof. The High Court found that the legislative intent of the Tobacco Control Fund, to assist in dealing with the adverse effects of Tobacco consumption, was indeed met by the establishment of the Solatium. It considered that just as the Tourism Levy, the Solatium was provided for in legislation. It therefore found that it was unable to find a violation of the Petitioner’s right to property or of the provisions of article 210 of the Constitution.
119.On appeal, the Court of Appeal affirmed the High Court agreeing inter alia that the Solatium was not a tax. It stated in this regard as follows:
120.The fundamental finding of the Court of Appeal is that the solatium is not a tax. We find no reason to hold otherwise. The Court of Appeal was emphatic that the contribution is not a payment that goes towards the national revenue. We add that neither is it a payment that goes to county revenue. It is not a payment that is made to the consolidated fund so as to be part of the annual government budgeting and appropriation. The solatium is provided under statutes anchored with a clear framework on its purpose. The mere fact that a piece of legislation provides for the levying of a particular amount does not transform that payment into a tax.
121.Consequently, having found that the Solatium is not a tax, and this appeal raises no constitutional issue as to how it was enacted, we find that the other considerations raised by the appellant as regards this fund do not fall for determination by this Court, in exercise of its jurisdiction under article 163(4)(a) of the Constitution.
(v) Appropriate reliefs
122.In considering the appropriate relief in this matter, it was the appellant’s prayer that the appeal be allowed. In the alternative, Counsel Mr. Kiragu Kimani in his Reply, urged this Court, if it makes a finding that the Regulations are legal and legitimate, that this Court considers ordering that they be effected six months after the date of this Court’s judgment. However, having found that the Court of Appeal Judgment is sound, we see no reason why this Court should delve into determination of how the Superior Courts’ judgments should be executed and or implemented. Consequently, we make no pronouncement on this issue.
123.Lastly, on the issue of Costs, the Court of Appeal had exercised its discretion and ordered that each party bears its own costs, we leave that order undisturbed. We equally exercise our discretion on awarding costs and order that each party bears its own costs before this Court.
124.Consequently, this Court finds that the Petition of Appeal dated 31st March 2017 has no merit and the same is dismissed in its entirety.
Orders1.That the Petition of Appeal No 5 of 2017 is hereby dismissed.2.That the Judgment of the Court of Appeal of Kenya at Nairobi in Civil Appeal No 112 of 2016, is hereby upheld.3.Each party to the Appeal shall bear their own costs.
125.Orders accordingly.
DATED AND DELIVEREDAT NAIROBITHIS 26TH DAY OF NOVEMBER 2019................................D.K. MARAGACHIEF JUSTICE/PRESIDENT OF THE SUPREME COURT .................................P.M MWILUDEPUTY CHIEF JUSTICE / VICE PRESIDENT OF THE SUPREME COURT.................................J.B. OJWANG JUSTICE OF THE SUPREME COURT .............................. S.C WANJALAJUSTICE OF THE SUPREME COURT .............................. NJOKI NDUNGUJUSTICE OF THE SUPREME COURTI certify that this is a true copy of the originalREGISTRAR,SUPREME COURT OF KENYA