Consumer Federation
Equity Bank
Francis Tuiyot
Judicial Service Commission
Justice Isaac
Justice Lenaola
KPMG Audit
Supreme Court
Transcend Media Group

Surrogate litigants and guns for hire erode regulatory function

By far, the biggest hurdle faced by CA in its quest to be independent is the influence of surrogate entities enlisted by the dominant operator in the market with the sole aim of delaying any process that may lead to the levelling of the playing field in the telecommunications sector.

When Equity Bank announced its intention to introduce a thin sim card in the market to allow its customers opt out of Safaricom’s M-pesa platform, myriad of cases were “sponsored” by Safaricom to delay or otherwise frustrate the implementation of Equity Bank sim card operation. One such surrogate entity was Kituo cha Sheria, which went to court with the strange plea that the technology sought to be introduced was unsafe. An organisation whose motto is to “pursue social transformation of indigent Kenyans through legal aid and empowerment, advocacy and lobbying for pro-poor policies and commitment to respect for human rights” overnight was transformed into a world leader in sim card technological understanding, and a surrogate of a major and rich telecom operator in the market.

The suit by Kituo Cha Sheria was eventually dismissed but not before it consumed upwards of two years enjoying an injunction which prevented the launch of Equity Bank’s thin sim card project and allowed Safaricom to enjoy its M-pesa monopoly.

It is also generally accepted by market players that the Consumer Federation of Kenya (Cofek) is another surrogate of Safaricom which is always unleashed to obtain ex parte court orders against any action that may chip at Safaricom’s total market dominance.

The most recent outburst by Cofek was most unfortunate and exposed the impunity with which CFK operates when it comes to defending its surrogate paymasters. The Secretary-General of Cofek issued a statement late last month declaring that the partial implementation of the draft report “Telecommunication Competition Market Study in Kenya” was illegal and urging that there should be no implementation of any of the recommendations until a later date.

The protest is indeed laughable, if not totally absurd! The draft report contains in the whole measures and recommendations which are all in the public interest and meant to benefit the Kenyan consumer. By directing that mobile money platforms must be made interoperable immediately, Wangusi and his team at CAK was merely implementing a process that has been in discussion for more than 15 years and which will result in drastic reduction of the cost of mobile money transfers.

An objective consumer organisation ought to have been the champion of such a move and indeed have welcomed the immediate implementation of the recommendation.

In any event, CA has a mandate which is not tied to recommendations in the report – that is, the Authority can discharge its lawful function to issue policy directives which it is competent to issue.

However, it is not lost on sector players that the statement by the director-general of Cofek to the effect that partial implementation of the draft report was somewhat illegal, was setting the stage for its surrogate to object to the current trial implementation of the mobile money interoperability process between Safaricom and Airtel and subsequently Telkom Kenya on the basis that this process is pegged to the illegal implementation of a draft report.

But how times have changed.  A few years ago Safaricom had assumed total corporate capture of Kenya’s media and our courts; not any more.

The watershed moment came in October 2016 when, to the shock of Safaricom, Justice Francis Tuiyot threw out a gagging case against Transcend Media Group. Safaricom had rushed to court to gag the media and the public from relying on or disseminating information contained in an explosive KPMG Audit Report which detailed massive corruption at Safaricom, and which also concluded that Safaricom was literally being run as a rogue company.  The decision was devastating the telco.

It meant that its influence had waned and it no longer could flex its economic might by scaring third parties dealing with it or intimidate the courts anymore.

Further, Safaricom did not endear itself to judicial officers when it released personal telephone logs of Justice Isaac Lenaola of the Supreme Court to a private citizen who used the information to file a petition against Justice Lenaola at the Judicial Service Commission. Of all the things the company could do against a judicial officer, it should never have intruded into his/her private life, as all that single action did was confirm to all and sundry that the company works in cahoots with the State to scuttle the right to privacy. ^

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