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"content": "whether the energy importation of petroleum products (quota allocations) Regulations, 2010 are consistent with the provisions of the Energy Act, No.12 of 2006, 2. whether the regulations are discriminatory and therefore, contrary to Section 116 of the Energy Act, 3. whether there is a provision under the Energy Act permitting the Minister to allocate quotas; and, 4. whether there was some policy consideration that informed the enactment of the said regulation. The Committee held a total of four meetings with five oil marketing companies, namely; Total Kenya, Libya Oil Kenya, Kenya Shell and Gulf Energy and the Minister for Energy, and also examined additional information submitted before it. The findings of the joint Committee are contained in this Report. The Committee wishes to thank the Office of the Speaker and the Clerk of the National Assembly for the support extended to it in the execution of its mandate. Mr. Temporary Deputy Speaker, Sir, it is our pleasant duty, on behalf of the two Committees, to present the Committee Report and recommend this Report for the House to adopt. On 18th June, 2010, the Minister of Energy vide legal Notice No.96 of 2010 enacted the Energy Importation of Petroleum (Quota Allocation) Regulations, 2010 hereafter referred to as the regulation purporting to exercise powers conferred by Section 102 of the Energy Act, No.12 of 2006. Rule No.3 of the said regulations provide that there is one established portion of the import requirement to be known as the petroleum product quota allocation. Two, the petroleum quota allocations shall be imported by the National Oil Corporation of Kenya and three, the petroleum quota allocation shall be set out in the schedule thereon. It was the contention of the oil market marketers that the said regulation had the effect of reserving 30 per cent quota of oil importation of crude oil, jet fuel and automotive gasoline to the National Oil Corporation of Kenya, therefore, was in breach of Section 116 of the Energy Act in so far as it conferred upon the National Oil Corporation of Kenya unfair advantage over other players in the industry. The Committee subsequently heard the submission of the oil marketers and their complaints were divided into two. There were five legal issues raised and two supply of practical related issues raised. Under the legal issues, it was the contention of the oil marketers that the Energy Importation of Petroleum Regulation (quota allocation) was discriminatory to them contrary to Section 116 which reads as follows:- âWhen discharging its functions and exercising its power under the Act, the Commission shall ensure that no particular person is given undue preference subject to any undue advantage.â It was their contention that the National Oil Corporation of Kenya is a limited liability company incorporated under the Companies Act, Cap.481 of the Laws of Kenya and was, therefore, being given unfair or undue advantage as a particular person has mentioned in Article 116. Two, it was their contention that the regulations were ultra vires to the Energy Act in so far as they provided a system of importation of petroleum that is not through an open tendering system. We went ahead and mentioned that the 30 per cent quota would be providing for a separate importation process outside the Open Tendering System (OTS)."
}