The High Court in Malindi has transferred a case by Senate Minority Leader Stewart Madzayo challenging the Sh50 convenience fee charged to people using the eCitizen platform to the Constitutional and Human Rights Division of the High Court in Nairobi.
This was after the court allowed a preliminary objection to the case being heard because there was a similar case in Nairobi also challenging the constitutionality of the convenience fees.
Justice Mugure Thande also ruled that the petition could not be upheld as it violated the doctrine of subjudice .
The judge noted that there was a need to avoid two courts giving conflicting decisions on the same issues in dispute.
“It is in the interest of justice that the petitions are heard together,” ruled Justice Thande while ordering the petition by Mr Madzayo to be transferred to Nairobi.
During the hearing of the petition before Friday's ruling, the Attorney General had defended the government's move to charge Kenyans Sh50 convenience fees for using the eCitizen platform.
The AG said a gazette notice on the convenience fee did not contravene any law or constitution, arguing that it was legal and constitutional.
Through lawyer Ruth Lutta, the AG said that a gazette notice on implementation does not give timelines but says "immediately".
“Effecting of the Gazette Notice is progressive, the government is rolling further services on the platform, it needs time to fully implement,” said Ms Lutta.
According to the AG, the petitioner had failed to prove wilful neglect on the part of the State to protect rights under the Constitution.
Through lawyers Erick Muriuki and Barry Sande, Mr Madzayo told the court that the respondents had failed to show the court any statutory instrument to support the payment of the convenience fee.
They further argued that a gazette notice is not a statutory instrument to levy charges but serves as a notice and that the application of the convenience fee is not based on any law.
Unfair and unconstitutional
In his petition, Mr Mazdayo argues that it is unfair and unconstitutional to burden taxpayers with the convenience fee, which is paid to a third party, Pesaflow Ltd, whose role and ownership remains unknown.
The senator argues that the convenience fee is in essence an illegal tax imposed on people seeking government services, yet the money appears to be going to a private entity as evidenced by the issuance of two separate invoices and two separate receipts.
Mr Madzayo argues that all payments made through the eCitizen.go.ke platform are subject to a Sh50 'convenience fee' and that two invoices are issued for all payments made through the platform.
He says one invoice is issued on the government department's letterhead stating the service charge to be paid and a second invoice is issued on Pesaflow's letterhead stating the charge at Sh50.
Mr Madzayo says the fee is charged at a flat rate for all transactions, including transactions where the service fee paid to the government is Sh50, so the user pays the convenience fee at a rate of 100 per cent of the service fee.
“Clearly, the levying of this convenience fee is unconscionable and oppressive to the petitioner, citizens, and all persons as consumers of government services,” said Mr Madzayo adding that just as with the convenience fee itself, the formula used to arrive at the rate remains shrouded in mystery.
Mr Madzayo is seeking an order compelling Kenya Commercial Bank (KCB) and Equity Bank to publish details of the amounts paid to Pesaflow Ltd since the government began using the eCitizen.go.ke platform.
The petitioner also wants Pesaflow Ltd to hand over to the Kenya Revenue Authority (KRA) all monies collected as 'convenience fees'.
According to Mr Madzayo, the fee paid to Pesaflow is shrouded in mystery, opacity and unknown in law as there is no legal basis for charging it, especially when he and all persons as consumers of government services already pay for the services they seek from the government.
“It is not known what exactly the impugned convenience fee caters for given that the 1st Respondent (Pesaflow) does not appear anywhere in the two gazette notices and in any event, eCitizen.go.ke is a wholly owned domain and portal of the Government of Kenya,” he said.
Mr Madzayo argued that the user is essentially paying three times for the same service, namely the substantive fees for the service paid to the government, the mysterious convenience fee paid to Pesaflow and whatever transaction costs Safaricom charges through the MPesa service.
The petitioner says that instead of charging a nominal administrative fee, which would be a percentage of the payment made, Pesaflow, which is not mentioned in the gazette notice, has been charging the 'convenience fee' irrespective of the payment made.
