A petition seeking to unravel the mystery surrounding the use of Sh356 billion Eurobond cash borrowed by the Jubilee regime now hangs in the balance after petitioners failed to comply with court directions.
Busia Senator Okiya Omtatah and activist Wycliffe Gisembe failed to comply with the court's timelines on the amendment of their pleadings, prompting the State lawyers to apply for rejection of the petition.
The gist of the public interest case is petitioners' claim that Eurobond funds were illegally deposited in an off-shore account, which was out of the reach of Kenya's constitutional oversight organs.
The petition seeks explanation and accountability from the Executive and National Treasury on how the US$ 2.75 billion (Sh356 billion) was used. The money was borrowed by the Jubilee regime in the 2014/15 fiscal year.
Through a court order dated March 5, 2024 the petitioners had been directed to amend and re-file the petition within 21 days but they did so after ten months.
Resulting from the non-compliance and request of the State lawyers, the court has ordered the petitioners to file a formal application for time extension and explain why they delayed to file the amended petition on time.
The original petition was filed in 2015 against then President Uhuru Kenyatta(now retired), his deputy William Ruto (now President), Treasury Cabinet Secretary Henry Rotich, his Principal Secretary Kamau Thuge ( now Central Bank Governor) and the Attorney General.
The activists sued over alleged withholding of information by the Executive and the National Treasury on Eurobond transactions.
According to the petitioners, the Government borrowed US$2.75 billion (Sh356 billion) in 2014 from the International Community through the sovereign bond (the Eurobond). They believe a substantial amount of the Eurobond proceeds was misappropriated.
In the court papers, the petitioners complain of failure by the Executive and Treasury to comply with various provisions of the Constitution, the Public Finance Act, the Fair Administrative Action Act, the Leadership and Integrity Act and the Public Officer Ethics Act in their handling of the Eurobond proceeds.
The court had on March 5, 2024 granted Mr Omtatah and Mr Gisembe permission to amend their pleadings and furnish the respondents with the same with 21 days.
However, the petitioners filed the amended petition after ten months, on January 31, 2025.
Asked by the court reasons for the inordinate delay, the three-judge bench comprising Justices Roseline Aburili, John Chigiti and Lawrence Mugambi observed that the petitioners seemed not to have the reasons at hand as they only sought to have the amended petition be deemed as duly filed.
Their oral application was opposed by the respondents, who also asked for rejection of the petition.
"We direct that the petitioners file a formal application for enlargement of time and explaining the delay for consideration by this bench, on its merit," said the judges on Friday.
"The application to be filed and served within the next ten days upon which the Respondents and Interested Parties shall have corresponding ten days to file and serve their responses to the application," ordered the bench.
The interested parties include the Auditor General, Controller of Budget and the Law Society of Kenya.
Genesis of the court dispute is an alleged failure by the respondents to give the petitioners information concerning Eurobond. They claimed that the refusal was "to conceal the misappropriation of the funds".
"The respondents never bothered to respond to the letter and deliberately refused to give the information requested in order to conceal the misappropriation of the funds. The law requires of the respondents to demonstrate to the general public, that no part of the Eurobond funds was misused or stolen as reported by the media," said the petitioners.
"The application to be filed and served within the next ten days upon which the Respondents and Interested Parties shall have corresponding ten days to file and serve their responses to the application," ordered the bench.
The interested parties include the Auditor General, Controller of Budget and the Law Society of Kenya.
The genesis of the court dispute is an alleged failure by the respondents to give the petitioners information concerning Eurobond. They claimed that the refusal was "to conceal the misappropriation of the funds".
"The respondents never bothered to respond to the letter and deliberately refused to give the information requested in order to conceal the misappropriation of the funds. The law requires of the respondents to demonstrate to the general public, that no part of the Eurobond funds was misused or stolen as reported by the media," said the petitioners.
In the letter, they sought, among other things, a comprehensive brief on the Eurobond process and bank statements of the Central Bank of Kenya reflecting all the transactions relating to the Eurobond funds.
They had also asked for a breakdown of the projects that benefited from the Eurobond funds and evidence that the funds were budgeted for by Parliament.
In addition, they asked for evidence that the Eurobond funds were spent with the approval of the Controller of the Budget; and development budgets of all the departments and agencies that received the funds.”
It is their case that US$ 2 billion (Sh259 billion) of the 2014/15 Eurobond cash was borrowed for infrastructure development and to repay a syndicated loan owed by the Government in December 2014.
They allege that the remaining US$ 750 million (Sh97 billion) was borrowed from the International Market through the Eurobond by means of “Tap Sales” to finance infrastructure projects.
They say that the funds were illegally and unlawfully deposited in an offshore account instead of being deposited into the Consolidated Fund, as required by the Constitution and the Public Finance Act.
According to the petitioners, the offshore account was never surrendered to the Controller of Budget to approve it.
They argue that the Eurobond saga is a matter of huge public interest and those allegedly involved in it wield immense political power.
The case is scheduled for mention on April 24, 2025 to fix a ruling date for the petitioners' application for time enlargement.
