Benjamin Bogongo wins court case against CRB regulations, declares them null and void
The long, tedious court battle between The Central Bank of Kenya, the CS of National Treasury and Planning, and Benjamin Bogongo has finally ended. Benjamin Bogongo, the petitioner, filed a petition against the Cabinet Secretary National Treasury as the 1st Respondent and The Central Bank of Kenya as the 2nd Respondent.?
The petitioner filed the following reliefs: The process through which the section 28(4) and 32(4) Credit Reference Bureau Regulation 2020(Amendment) was passed violated the Constitution in that it failed to meet the requirement of public participation. The petitioner’s case set out that Regulation Banking (Credit Reference Bureau), were not in the Draft Regulations 2019 that was presented and subjected to public participation. The petitioner contended that the impugned Regulations are unlawful, unconstitutional, and therefore invalid, null, and void for violation of Articles 1,10,26,27,28,40, and 43 of the Constitution.?
In opposition, the 1st Respondent, the Cabinet Secretary National Treasury and Planning, filed ground of opposition dated 11.11.21. The grounds, in summary, are that the Petition did not meet the minimum principles set out that it does not disclose adequate particulars in support of the alleged violations of the Constitution and the law and does not disclose any legal and justifiable claim. The 1st Respondent also filed a replying affidavit sworn on 23.9.21 by Dr. Julius Monzi Mui, the Principal Secretary of the National Treasury. He stated that due legal process and public participation was followed in enacting Regulations 28(4) and 32(4) of the regulations. He further deposed that the proposals received during the call for comments were incorporated into the draft Credit Reference Bureau Regulations 2019, which were then exposed to further stakeholder and public statements in May/June 2019. The Senate received a petition concerning the financial strain and hardship visited upon fresh graduates by the clearance certificates required by Public Services Boards during the application of jobs In Kenya, which sets graduates back over Kshs.6000/= in the job application process. The Senate engaged the various heads of boards in charge of issuing the clearance certificates as stakeholders on this matter. Following this engagement, the impugned Regulations 28(4) and 32(4) were incorporated into the regulations published in a Gazette Notice and submitted to the National Assembly and were fully approved in accordance with the Statutory Instruments Act, accordingly.?
The 2nd Respondent Central Bank of Kenya (CBK) opposed the Petition vide a filed replying affidavit sworn on 14.9.21 by Kennedy Kaunda Abuga, its general counsel. He stated that in the exercise of its statutory mandate under section 57(1), CBK called for and reviewed comments from Commercial Banks, Sacco’s, and Microfinance Banks Kenya Bankers Association. The comments were received in July 2019 that those agreed with were incorporated with the Draft Credit Reference Bureau Regulations,2019 and gave reasons for those not agreed with. In a supplementary affidavit sworn on 6.10.21, the petitioner stated that the impugned Regulations were not subjected to public participation; similarly, the 1st Respondent did not consult parties that would be directly or indirectly affected by regulations per section 5 of the Statutory Instruments Act. He declared that the Statutory Instruments register of the National Assembly shows that the Regulations were received on 5.5.2020, which was 31 days late, contrary to section 11 of the Statutory Instruments Act. The court duly considered the rival pleadings and submissions highlighted by the parties. The following issues aroused determination;
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The respondents were able to respond to the claims made by the petitioner accordingly, the contention that the Petition did not meet the threshold for a constitutional petition was not merited. The constitutional imperative of public participation was met when an invitation to stakeholders were made and views received and considered. Further, the Credit Information Sharing Association of Kenya addressed the issue of clearance certificates. It stated they should be restricted to employers and government agencies that have no access to credit reports. TheCourtt was satisfied that there was sufficient stakeholder engagement in the process of promulgation of the impugned Regulations. TheCourtt noted the petitioner sought the invalidation and nullification of Regulation 28(4) of Regulation only however, this drew attention to the fact that the 1st Respondent did not comply with the mandatory requirements of section 11 of the Act, namely to transmit the Regulations to the Clerk of the National Assembly within the stipulated time. TheCourtt found that the entire CRB Regulations, 2020, void by operation of law and ceased to have effect on the last day, which they ought to have been transmitted to the Clerk of the National Assembly for tabling before the House. The petitioner sought an order for compensation for damages and loss to service providers, if any; however, no submissions were made in this regard. TheCourtt also found that the 1st Respondent contravened the express and mandatory provisions of section 11 to comply with the laws of the land, to simply do the right thing. Having held as above, the orders that commended themselves to the Court were;