KenTrade has significantly gained in its role in trade facilitation after the government approved the regulations to make the National Electronic Single Window System Act (No. 25 of 2022) operational. It was necessary to develop rules to ensure that the procedural details that the system users require for registration, access, use, payment for services, and system administration are according to the Mother Act.
With the new regulations, Kentrade intends to use revenue generated from the user fee to fill the budgetary gaps that have hindered its work, as it has over the years solely relied on Treasury allocations despite its growing role in trade facilitation in recent years.
KenTrade is a state corporation established through an executive order signed by the President, on January 14, 2011, and gazetted via Legal Notice No. 6 of 2011 on January 28, 2011, to address inefficiencies in cargo clearance processes and the trade logistics chain in Kenya. The Act was subsequently enacted on June 21, 2022. This provided the legal framework for strengthening electronic transactions through the establishment of an Act of Parliament to manage and operationalize the National Electronic Single Window System.
The National Treasury, in consultation with KenTrade, put in place these regulations to give effect to the Mother Act. KenTrade said that under Section 5 of the Statutory Instruments Act, the agency identified key stakeholders likely to be impacted by the Regulations for purposes of consultation and seeking their input on the draft Regulations.
“These stakeholders included Partner Government Agencies (PGA); industry players and institutions; the private sector; and individuals who will be directly or indirectly affected by the proposed regulations,” KenTrade said in a recent brief.
The National Electronic Single Window System plays a complementary role to customs by ensuring that all goods imported and exported are correctly declared. The system also ensures that all regulatory approvals and releases are received before customs releases any consignments at the various points of entry.
According to the new regulations, applications for registration in the system will attract a user fee of 50 US dollars or its equivalent in Kenya Shillings. There will also be an annual access fee of 50 US $ per user. Application for lifting of a suspension will cost US$10 per user, with a request for change of particulars costing US$5.
Other charges include an application for a Unique Consignment Reference (UCR) number in the system that will be charged US$10 per transaction and an application for notification for the impending arrival or departure of a consignment that will cost 80 US dollars.
An application for an import and export exemption will cost US$10 per transaction. An application for a domestic trade permit or license will also require one to pay 5 US dollars per transaction.
Since its inception, KenTrade has successfully enlisted 45 stakeholder institutions, including 37 Partner Government Agencies (PGAs).
“Currently, efforts are underway to onboard Scrap Metal Council, Kenya Wildlife Service, and Kenya Civil Aviation,” the agency said, adding that it recently completed the onboarding of the Kenya Copyright Board (KECOBO) to facilitate collection of the blank tape levy. The levy is intended to improve the welfare of copyright holders in the county.
Users of the system currently stand at over 18,634. An average of 4,000 permits are lodged daily through the system, generating a revenue of close to Kshs. 900 million quarterly for the PGA using the system.
Over 70% of PGAs process their permits within one day, thus decreasing the time taken to clear cargo. The target is for all permits to be processed within hours. The system has been integrated with key PGA that include Kenya Revenue Authority (KRA), Kenya Ports Authority (KPA), Kenya Bureau of Standards (KEBs), KEPHIS, Agriculture Food Authority (AFA), and seven directorates.
An increased level of trade automation has been witnessed; it has been observed that before the implementation of the Single Window System, only 14% of the total trade facilitation processes and procedures in all relevant government agencies were transacted electronically. Currently, the agency notes, that close to 95% of the processes have been automated through the Single Window System. This has reduced costs and delays and allowed more stakeholders to engage in trade facilitation.
Alongside its core mandate, KenTrade has overseen the roll-out of other trade facilitation tools that have eased global transactions for Kenyan traders. In 2017, KenTrade launched the Information for Trade in Kenya (InfoTradeKenya) portal.
The development of this platform was in response to a gap identified in cargo clearance information among the trading community and the need to merge all the procedures into a single portal accessible to all those involved in international trade as prescribed by Article 1.2 WTO Trade Facilitation.
The portal is an online platform that provides comprehensive, single-point access to up-to-date trade-related information. It provides a step-by-step guide for imports; exports, and transit trade procedures to assist traders in making informed choices.
Another significant milestone KenTrade has made is the launch of the Kenya Maritime Single Window System. This was a joint project with the Kenya Maritime Authority (KMA) on the implementation of the FAL Convention.
This is a requirement for national governments to introduce electronic information exchange between ships and ports, which came into effect on April 8, 2019. Actors aimed to make cross-border trade simpler and the logistics chain more efficient for the over 10 billion tons of goods traded by sea annually across the globe.
KenTrade carried out the Ksh90 million business intelligence (BI) tool. The tool seeks to collect extensive data on Kenya’s import and export trade. The new BI Tool analyses and disseminates data in real-time to trade facilitators and government agencies, aimed at making better data-driven decisions. The BI tool helps to facilitate ease of trade in Kenya through the extraction and analysis of real-time data to help trade facilitators and government agencies make data-driven decisions.
This article was published by Githua Kihara, an editorial consultant for FEAFFA’s Freight Logistics Magazine. For any inquiries, please contact us via email at editorial@feaffa.com or freightlogistics@feaffa.com, or reach out to Andrew Onionga directly at onionga@feaffa.com / +254733780240.
