Good morning,
Today we begin with an update of Kenya’s response to the situation in Ethiopia:
Last week, The Inspector General of police directed all police officers on leave or off duty to report back to work by today. This is because Kenya is mobilising its security forces to prevent a spillover of the conflict in Ethiopia. The major fear is that the conflict could lead to an influx of refugees and illegal arms into Kenya.
Kenyans borrow Ksh 1.34 billion daily.
On Wednesday, Safaricom unveiled its financial results for the first half of 2021 and the highlight was the fact that Kenyans borrow an average of Ksh 1.34 billion daily through the Fuliza Platform.
What else was in the report
700,000 new users were registered in the fuliza platform in the first half of 2021.
The value of loan disbursements by Fuliza hit Sh242.6 billion, up from Sh149.4 billion in the previous year.
At least Sh40 billion is borrowed via Fuliza every month.
Kenyans spent Sh83.2 billion to place bets through the M-pesa platform.
Safaricom’s Revenue from betting doubled to Sh2.95b from Sh1.48b in the previous year.
TAXES
Does your Social media lifestyle match your taxes ?
Last week, KRA (Kenya Revenue Authority) announced that it’s officers will monitor individuals’ lifestyles on social media and audit Kenyans displaying lavish lifestyles. Those found to have ‘suspicious’ lifestyles that do not match their taxes face the risk of travel bans and prosecution.
While the announcement signifies KRA’s determination to tighten it’s grip against tax evasion, the implementation of the idea raises certain legal questions:
a. Are social media users protected by privacy rules ?
b. What are the limits to social media mining by Kenya Revenue Authority ?
CAPITAL MARKETS
1. Kenya explores the idea of a Central Bank Digital Currency
According to the CBK (Central Bank of Kenya), Kenya is exploring the potential use of a Central Bank Digital Currency.
Central Bank digital currency is an electronic form of central bank money that citizens can use to make digital payments and store value. It is issued by a nations’ Central Bank and is backed by the government.
Nigeria launched its own Central Bank Digital Currency, the ENaira this year and it had transactions worth $113,000 in the first 2 weeks of its launch.
2. The Capital Markets Authority has licensed Globetec Asset Managers Limited as a fund manager
Globetec Asset Managers offers a variety of products ranging from unit trust funds to real estate investment trusts for high-net-worth individuals.
LEGAL
Rwanda & Burundi lawyers blocked from practicing in Kenya
The National Assembly has blocked lawyers from Rwanda and Burundi from practicing law in Kenya stating that their rights to work in Kenya should be on reciprocal basis to Kenyan lawyers wishing to practice in these countries.
Backstory:
In 2012, Parliament through the Statute Law (Miscellaneous Amendment) Act 2012, amended Section 12 and 13 of the Advocates Act allowing lawyers from Rwanda and Burundi to practice in Kenya.
However, the Law society of Kenya objected the amendment and moved to court claiming that the amendment was a violation of parliamentary power because there was no reciprocal access for Kenyan advocates in Rwanda and Burundi.
The Court of Appeal struck out the amendment of section 12 & 13 of the Advocates act meaning that Rwanda and Burundi lawyers cannot practice in Kenya
Looking Forward:
The Chief Registrar of the Judiciary has advised Members of Parliament that there is an urgent need to amend the Legal Education Act and the Kenya School of Law (KSL) Act to clarify:
The minimum secondary school qualifications for entry into the Bachelor of Laws (LLB) program in Kenya.
The eligibility and minimum requirements for non-Kenyans who are already admitted to practice law in the East African Community or the Commonwealth and are seeking admission to practice law in Kenya.
The applicability of minimum secondary school qualifications for persons who obtain their Bachelor of Laws degree abroad before returning to join KSL.
The applicability of the minimum secondary qualifications for Kenyans who are already admitted to practice law in other countries and wish to petition to join the Kenyan bar.
IMPORTS
No importation of cars registered before the year 2015
The Kenya Bureau of Standards (KEBS) issued a public notice stating that cars older than 8 years will not be allowed into the country effective 1 January 2022.
This includes cars being shipped home by returning residents and diplomatic staff.
KEBS Managing Director:
“We wish to notify all importers of second hand motor vehicles and the general public that in observance of the eight year age limit requirement, only Right Hand Drive motor vehicles whose year of first registration is from January 1, 2015 and later shall be allowed into the country,"
This means that all vehicles registered before 1 January 2015 have to be imported before the start of next year.
BANKING
Banks likely to ration loans to individuals and small businesses
The CBK (Central Bank of Kenya) Governor warned that Banks would most likely steer clear from lending to individuals and small businesses following the 12 month moratorium of listing in the CRB (Credit reference Bureau) loans of less than 5 million.
Backstory: on 20th October, the president gave a directive suspending the blacklisting of defaulters with loans below Ksh 5 million by the Credit Reference Bureau until September next year.
Why Banks might ration loans:
The lack of Credit Reference Information means that the borrowers’ information is incomplete thus increasing the costs of loans.
A statement by the Kenya Bankers Association revealed that about 1 million borrowers were shut out of loan facilities after the presidential directive because banks could not access their credit information.
MUST KNOW CONVERSATION STARTERS
World Bank blacklists Kenyan firm - The World Bank has blacklisted Nairobi based Africa Development Professional Group (ADP) over fraudulent practices during a project in Somalia. This means that ADP is ineligible to participate in projects and operations financed by institutions of the World Bank Group for 21 months.
Chief Justice Martha Koome appeals High Court Judgement - The Chief Justice has appealed against a High Court decision allowing her to appoint six judges should the president refuse to swear them. In the notice of appeal, the Chief Justice stated that she was dissatisfied with the Judgement hence the appeal.
Kenya to buy stake in oil project operated by Tullow Oil Plc- As per Bloomberg, Kenya Plans to raise $1 billion of debt in order to buy stake in the oil project. The debt will be used to fund Kenya’s part of the project which includes a heated pipeline to the Coast region for exports and an estimated output of 120,000 barrels a day.
Desert locusts invade Mandera - Mandera County Locust Focal Officer stated that At least 13 swarms of Locusts have invaded Mandera. Three swarms were sighted in Mandera North from Ethiopia, Mandera East and Lafey from Somalia.
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