Court suspends Butali Sugar firm operations

February 14, 2011 12:00 am

, NAIROBI, Kenya, Feb 14 – The controversy surrounding the licensing of Butali Sugar factory deepened on Monday, after the High Court suspended its operations.

Three High Court judges on Monday reinstated an order issued in October last year blocking the sugar milling company from operating in the designated area belonging to West Kenya Sugar Company.

The Sugar Act states that the distance between two sugar factories should be a minimum of 40 kilometres but is far much less between the two.

Justices Jean Gacheche, George Dulu and Daniel Musinga issued the order barely a month after Prime Minister Raila Odinga commissioned the new factory.

The Prime Minister officially commissioned the factory in Kakamega despite objection by Agriculture Minister Sally Kosgei who skipped the event.

West Kenya Sugar had moved to court last year claiming that Butali Sugar factory would be poaching cane within its six milling zones if allowed to operate.

In October the High Court issued an injunction blocking the Kenya Sugar Board (KSB) from issuing an operating licence to Butali. The order was to be in force until February 14 when the matter was to be heard inter-partes.

West Kenya Sugar Company filed an urgent application on February 12 in arguing that the Attorney General and the Kenya Sugar Board disregarded the court order and issued Butali with a licence to operate.

"On January 11 the Attorney General through Senior Deputy Solicitor General Muthoni Kimani directed the KSB to issue a milling licence to Butali Sugar Mills notwithstanding the conservancy orders issued by this court on October 8, 2010 and which remains in force," West Kenya lawyers told the court.

According to the court papers, the licence was subsequently issued by KSB on January 13 permitting it to manufacture sugar and other products.

In challenging the AG\’s directive and consequent grant of licence, West Kenya Sugar Company says the AG who ought to have been \’ the custodian of the Rule of Law and guardian of the administration of justice is subverting the law and the court ought to reprimand him in the strongest terms possible."

Last month Deputy Prime Minister Musalia Mudavadi said further delays in giving Butali Sugar Mills a crushing license would be "immoral."

The DPM regretted that investments by the entrepreneur and more than 31,000 sugarcane farmers are going to waste.

He, however, noted that Government authorities were currently holding talks with the view of helping the factory commence operations by the end of the month (January).

The court order now stays in place until the petition by West Kenya Sugar Company is heard and determined.

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