The government of Uganda has filed a lawsuit against Kenya at the East African Court of Justice, seeking a judicial resolution in the disputed oil importation agreement.
According to court documents filed by Uganda’s Attorney General on December 28, 2023, Kenya blocked the Energy and Petroleum Regulatory Authority (EPRA) from awarding the country a license to import oil through Mombasa Port.
Furthermore, Uganda stated that it imports around 90% of its refined petroleum products through the Port of Mombasa in Kenya.
The products are then transported to Uganda through the Kenyan Pipeline Company Limited (KPC).
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In addition, the Yoweri Museveni led administration wants to cut off Kenyan Oil Marketing Companies (OMCs) from importing fuel on behalf of Uganda.
Since 2023, the importation and supply of refined petroleum products into Uganda has been handled by the Oil Marketing Companies (OMC) operating in Kenya through the Kenya Open Tender System (OTS).
Consequently, the products are also handled through the Government-to-Government arrangements between Kenya and foreign Governments, that Kenya adopted in early 2023.
Under the agreement, OMCs operating in Kenya import petroleum products and sell them to Uganda’s OMCS, exposing the country to supply vulnerabilities.
“The complete reliance and dependency on Kenyan OMCs to import and supply petroleum products to Uganda have exposed the Republic of Uganda to supply vulnerabilities resulting in an avoidable increase in fuel pump prices,” the documents read in part.
Move to Changes in Importation and Supply of Oil Products
Additionally, earlier, the Ugandan government changed its policies regarding the sourcing, importation, and delivery of petroleum products for the Ugandan market.
As a result, Uganda authorized the Applicant, through Uganda National Oil Company (UNOC), to be the sole importer and supplier of all petroleum products for the Ugandan market.
However, implementation of the planned policies was hindered since UNOC failed to provide the relevant documentation as requested by EPRA.
Also, Uganda had asked for a waiver of the rules, claiming that they were unnecessary because the imported goods were not bound for Kenya.
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“Upon engagements with the relevant authorities in Kenya, UNOC sought to enter into a Storage and Transportation Agreement with KPC.
“Consequently, UNOC was required by the Respondent to meet certain regulatory requirements including obtaining an Import, Export and Wholesale of Petroleum Products (except LPG) License (hereinafter referred to as “the License”) from EPRA to utilize the petroleum transit infrastructure in Kenya, especially the Kenya Pipeline systems in furtherance of the new Ugandan policy,” added the document.
Demands by Ugandan Government
Uganda sought the involvement of the Republic of Kenya at all material times to prohibit its organs of state from violating the Treaty and Protocols.
Further, it seeks a determination that the Republic of Kenya’s action banning the provision of any waiver of the licensing conditions for the License to the Applicant violates Articles of the Treaty Establishing the East African Community.
In addition, Uganda claims that it is a landlocked country with the right to access and transit through Kenyan territory by all means of transport under the Treaty for the Establishment of the East African Community and the United Nations Convention on the Law of the Sea, both of which the Republic of Kenya is a signatory to.
“A declaration that the action of the Republic of Kenya restraining EPRA from issuing the Licence to the Applicant contravenes Articles 5(1), (3)(a), (b) and (h); 6(b) (d) and (f); 7(1) (a), (b); 8(1)(a) and (c); 23; 27, 28; 76(1); 89(b) and (e); 90(1); 93(c) and (d); and 130 of the Treaty for the Establishment of the East African Community and Articles 3(2), 4(2)(a), 5(1), 18 and 38 of the Protocol”, Uganda stated.
