In a ruling with significant ramifications, the High Court in Nairobi on Tuesday invalidated the entire Privatisation Act 2023, declaring it unconstitutional.

The court cited serious flaws in the legislation, particularly the lack of adequate public consultation during its formation.

The ruling highlighted the need for public participation in the legislative process, stressing that it is a constitutional requirement.

"The Constitution is the supreme law, and the public must be involved in public participation. The National Assembly does not do the public a favour by inviting them to participate," the court stated.

Additionally, the court pointed out that the Kenyatta International Convention Centre (KICC), one of the parastatals earmarked for privatisation, is a national monument and an important cultural symbol.

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Its sale, the court noted, would infringe upon constitutional and cultural rights, further cementing the decision to halt its privatisation.

This case was brought to court by the Orange Democratic Movement (ODM) in December 2023, following the government’s move to privatise six key state corporations, including KICC, Kenya Pipeline Company (KPC), and New Kenya Cooperative Creameries (New KCC).

In their petition, ODM argued that these parastatals are national assets funded by public money and that their sale violated the constitution.

The opposition also opposed the proposed sale of Kenya Seed Company, the Kenya Literature Bureau (KLB), and the National Oil Corporation of Kenya, maintaining that these entities were essential to public service and should not be sold off without proper constitutional review.

In response to the petition, the High Court granted a conservatory order, temporarily preventing the government from selling the six entities until the case could be fully heard and resolved.

Justice Chacha Mwita, in issuing the order, observed that the petition raised significant constitutional and legal matters that required thorough examination.

He noted, "The opposition raised substantial constitutional and legal questions of public importance that require critical examination and consideration by the court."

Justice Mwita further directed the respondents, including the National Treasury, to respond to the petition within five days.

The court order stated, "A conservatory order is hereby issued suspending implementation of section 21(1) of the Privatisation Act 2023 and or any decisions made under that section, until February 6, 2024, given under my hand and seal of the Honourable court this 4th Day of December 2023."

The government’s push to privatise state-owned corporations followed a November 2023 announcement by the National Treasury, which listed 11 parastatals slated for sale, citing their financial losses despite substantial state support.

However, with this latest ruling, the process of privatising key parastatals has been brought to a halt, pending further judicial review.