Combating illicit trade - Kenya Association of Manufacturers (KAM)

In 2008, KAM identified the issue of counterfeit goods a major threat to growth in the manufacturing sector. BAF supported KAM with research and advocacy grants, resulting in the successful enactment of the Anti-Counterfeit Act, 2008. The Act led to the formation of an Anti-Counterfeit Agency (ACA) that started operations in June 2010.

In 2014, KAM sought further BAF support to aid the implementation of the Anti-Counterfeit Act. This is because there had not been a significant reduction in the prevalence of anti-counterfeit goods in the market. As part of the implementation, KAM in collaboration with the National Council on the Administration of Justice (NCAJ) consolidated all the relevant laws on illicit trade into one reference book titled, ‘Enforcement Manual to Combat Illicit Trade in Kenya’. The manual provides background information on what illicit trade is, and the various forms of illicit trade that exist, hence serving as a point of reference for law enforcement and the public, on the impact of illicit trade and best practise in tackling cases.

In 2015, KAM sought further BAF support to continue engagement on the manual to ensure key law enforcement agencies including investigators, judicial officers and prosecutors not only had the manual, but were well versed with it, to improve their effectiveness and prosecution of illicit trade cases.

In addition, KAM in collaboration with Trade Mark East Africa (TMEA) conducted a study to determine the severity of the counterfeit problem in Kenya as it affects industries, and the impact of proliferation of counterfeit products from other EAC partner states and Far East countries into the Kenyan market. The study established that manufacturers in Kenya were losing 40% of their market share to counterfeiters. This informed KAM on the need to proactively enhance her advocacy work, to reduce this menace in Kenya.

KAM’s continued advocacy has also resulted in:

  • Significant amendments of the ACA Act, 2008 through the Statute Law (Miscellaneous Amendment) Act, No. 18 of 2018. The most significant amendment is the conversion of the Anti-Counterfeit Agency to the Anti-Counterfeit Authority, effectively giving more powers to the Anti-Counterfeit Authority to implement their mandate;
  • Formation of the Multi-Agency Team under Presidential directive bringing together: the State Department of Trade (SDT), the Anti-Counterfeit Authority (ACA), Kenya Revenue Authority (KRA), Kenya Bureau of Standards (KEBS), Kenya Copyright Board (KECOBO) and the Pharmacy and Poisons Board (PPB);
  • The gazetting of the Inter-Agency Anti-Illicit Trade Executive Forum and the Technical Working Group and the appointment of the KAM CEO to both the forum and the working group.

Despite these successes, there are outstanding challenges affecting the manufacturing sector. These include:

  • Excessive delays in clearance of goods at the port caused by the absence of a coordinated mechanism by all relevant government agencies for imported goods including service charters and Standard Operating Procedures (SOPs), with some enforcement agencies having overlapped and duplicated roles. In addition, there is a requirement for destination inspection to verify the suitability of the KEBS Pre-Shipment Verification of Conformity (PVoC) programme that has been accused of increasing incidences of delays;
  • The lack of an up to date anti-illicit trade enforcement manual reflecting the changes to the laws affecting imports including the amendments to the ACA Act, Kenya Industry Properties Act and the Copyright Act among others. An updated anti-illicit trade manual would improve the likelihood that the judiciary makes appropriate decisions on illicit trade issues;
  • The lack of information for the private sector on the ever-changing laws and requirements for compliance contributes to non-compliance resulting in the importation of illicit goods.

KAM now seeks further BAF to support work with MITC through the MAT and the Inter-Agency Anti-Illicit Trade Technical Executive Forum (TEF) and Technical Working Group (TWG) to advocate and address these challenges.