Matindi v National Assembly: A Double Novelty In the Kenyan Supreme Court Judgement Every Tax and Constitutional Practitioner Should Know
MLR Issue 010 — A Commentary
Samuel Odiwuor Kaumba appears on the cover page of this 17th July 2026 judgement for the 3rd and 5th respondents. I have known that name and the counsel a great deal longer than I have known this case. Sam was years ahead of me in our high school, and he was already an advocate by the time I was a Form 4 student who had no clear idea what that word even meant in practice. As the then sec-gen of the old boys association, he used to come back and talk to the younger boys. On other busier days, he’d write a message to us through the school magazine. It was not the usual polished, distant “success story returns to alma mater” speech from an alumnus returning to a school hall, but something more direct: what the work was, what it demanded, and why it mattered. I did not decide to read law because of a case. I became an advocate, in no small part, because a man who had once sat where I was sitting came back often enough, and spoke plainly enough, to make the profession look like something worth the years it takes. I would follow in his footsteps at Parklands Campus. Finding his name on the cover page of a Supreme Court judgment I am now writing a critique of is not something I want to pass over without saying so. For inspiring a generation, counsel deserves his overdue flowers.
That is the personal reason why I read this judgment line by line rather than skimming for the headline. What follows is the professional reason it matters for advocates who will act on it, not summarise it, and it is not the reason most commentary on this case will give.
Background
Between 2007 and 2020, the Governments of Kenya and Japan concluded sixteen bilateral financing agreements covering infrastructure and development projects, among them the Mombasa Port Development Project, the Mombasa Special Economic Zone works, and several Olkaria geothermal projects [3]. The Cabinet Secretary for the National Treasury and Planning gave effect to the tax terms of those agreements through Legal Notice No. 15 of 2021, issued under section 13(2) of the Income Tax Act, exempting Japanese companies, consultants, and employees engaged on the projects from Kenyan income tax to the extent specified in the respective agreements [2]. The Notice was tabled before the National Assembly’s Committee on Delegated Legislation, which found it properly issued and not subject to public participation because it recorded an intergovernmental understanding. Accordingly, the Committee’s report was adopted by the House on 19th May 2021 [5].
Eliud Matindi, acting in person, challenged the Notice by way of Constitutional Petition No. E280 of 2021, arguing that any tax waiver required primary legislation under Article 210(1), that the Committee had wrongly perceived the Notice as exempt from the Statutory Instruments Act’s public participation requirements, and that the selective exemption was discriminatory [6] and [7]. Magare J agreed, quashing the Notice, declaring section 13(2) unconstitutional to the extent of its inconsistency with Article 210, and describing the differential treatment of Kenyan and Japanese workers on the same projects as amounting to “economic apartheid” [13], [18]. The National Assembly, the Speaker, the CS Treasury, and the Attorney General appealed. The Court of Appeal (Musinga P, Lesiit, and Achode, JJA.) allowed the consolidated appeals, holding that the Notice was executive rather than legislative in character and therefore fell outside the Statutory Instruments Act altogether [22] and [23]. Matindi’s second appeal, decided on 17th July 2026 by the apex court, is the judgment currently under review.
The first novelty: the disclosure gap
The Supreme Court affirms the Court of Appeal’s position, holding that the Notice is “administrative” rather than “legislative” because it merely gives effect to bilateral agreements already in force and creates no independent rule [68]. The test the Court applies, administrative if the instrument “guides the implementation of standards in law and policy,” legislative if it “varies or repeals general laws... affecting the public at large” [67], is uncomfortable when assessed against the Court’s own recitation of the trial record. Section 13(2) does not authorise the Cabinet Secretary to publicise anything; it authorises him to create a tax exemption “to the extent specified in such notice” [54]. An instrument that determines who among persons earning identical income sourced in Kenya pays tax and who does not is a variation of the general incidence of income tax, not an administrative function of it. The Court records Magare J’s “economic apartheid” finding at the trial court without disturbing it [13], which makes the “administrative” label the operative holding rather than a settled premise.
The consequence for the discrimination ground, at paragraph [77], is the part every litigator handling a similar file should read twice. Having found the Notice not legislative in character, and therefore free of any Statutory Instruments Act disclosure obligation, the Court then holds against the appellant on discrimination because he never produced the terms of the underlying financing agreements, agreements the judgment itself records he had specifically asked the High Court to compel disclosure of [77]. Denied a participatory right at the point the Notice was made, and denied the particulars that would have substantiated a discrimination claim at the point of review, he is then held to a burden only those particulars could discharge. That is not incidental to this case; it is a holding that will recur in every future challenge to a gazetted exemption tied to an underlying agreement that has not been disclosed. For advocates, the pleading answer is to make disclosure of the underlying instrument a standalone prayer under Article 35, filed and seeking an interlocutory determination before the constitutional merits are argued, rather than a subsidiary prayer that a court can interpret as unnecessary once it has already disposed of the classification question.
A second, narrower gap exists alongside it. Article 210(2) requires a public record of every tax waiver, with reasons, reported independently to the Auditor General, a distinct obligation from the section 13(3) tabling requirement [51]. The Court analyses compliance with tabling as though it exhausts Article 210 [69] through [72]; it makes no finding that the Auditor General’s record was ever produced or reported. That omission is not fatal to this judgment, but it is a pending fact in issue for the next case, and counsel should plead for the record directly rather than assume the point was tested here.
The second novelty: the operative instrument was never challenged
Section 13(3) of the Income Tax Act, the same subsection that governs tabling, also contains a savings clause: annulment of a Notice by parliamentary resolution operates only prospectively, “without prejudice to the validity of anything previously done thereunder, or to the issuing of a new notice” [54]. That clause, not the core holding, is what has protected every Japanese company, consultant or employee who has already claimed the exemption on income already earned under the Notice. Whatever the outcome, I surmise that their position was therefore never at risk in this litigation.
What remains at risk is prospective. The same clause that protects past reliance leaves the exemption open to annulment by ordinary resolution at any sitting of the National Assembly, and this judgment offers no procedural ground to resist that. A Notice held to be administrative rather than legislative attracts no public participation right at the point it was made, and nothing in the judgment suggests annulment would require any process beyond the resolution itself [54], [68]. For counsel negotiating the next financing agreement that will rest behind a section 13(2) exemption, that is the operative risk, and it must be addressed in the drafting room, not in the courtroom. Two practical implications follow for advocates from this judgement. Build a tax adjustment or indemnity clause into the financing agreement itself, triggered by future annulment or successful constitutional challenge to the Notice, rather than handling the Gazette Notice as the end of the certainty analysis. Also, obtain and file the Article 210(2) Auditor General record contemporaneously with the Notice, because this judgment demonstrates that a court can uphold an exemption’s validity for years without that record ever being placed in evidence.
Conclusion
Most commentary on this judgment will analyse it as settling with finality the validity of Legal Notice No. 15 of 2021. That is the right question for a constitutional lawyer. And I think that it overstates the position on both fronts examined here. It is close to the wrong question for an in-house counsel, a deal counsel, or a CFO looking at a tax-exempt financing structure and asking what really protects the numbers on the model. The classification finding at [68] puts to rest one argument relating to bare reliance on the Statutory Instruments Act, without closing the disclosure route through Article 35 or the Article 210(2) evidentiary or doctrinal gap left open at [72]. Both remain available to a litigant who comes better prepared with their papers in order in the next case. And the provision that effectively determines exposure for past and future beneficiaries of the exemption is not the holding anyone will cite; it is the savings clause at [54], which remains untested in the same subsection everyone read past on the way to the constitutional question. Counsel on either side of the next gazetted tax exemption litigation should read the judgment for what it left open on the untested tax shield for Japanese companies, consultants or employees, not only for what it decided.
Gody Mwango is an advocate at Mwango Law Advocates, Mombasa, specialising in constitutional litigation, judicial review, and commercial law. He is the founder and managing editor of Mwango Law Review.