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TRADERS: A day to the expiry of current coffee trading licences, Capital Markets Authority (CMA) has issued the first set of licences to five coffee brokers in line with the Capital Markets (Coffee Exchange) Regulations, 2020.

It said the trading licences given three days after issuing a notice extending current ones for three months will allow the brokers to carry out the role of coffee brokerage services at the Nairobi Coffee Exchange (NCE) with effect from July 1, 2021. Meru County Coffee Marketing Agency Ltd has been granted a full coffee broker licence whereas others have been granted conditional licences.

Conditional licences

Applicants granted conditional licences are Kipkelion Brokerage Company Ltd, Murang’a County Coffee Dealers Company, Mt Elgon Coffee Marketing Agency Ltd and United Eastern Kenya Coffee Marketing Company Ltd. 

They are expected to come into full compliance with the requirements of the Coffee Exchange Regulations within the next three months, according to a statement uploaded on the CMA’s website. Licensing of the coffee brokers by CMA is likely to complicate any attempt by Agriculture Cabinet Secretary Peter Munya to extend the current trading licences for another year.

“The action by CMA ties the CS hand to further extend the licences for the second year,” said a senior officer at the ministry of agriculture who did want to be named.  

The Statutory Instruments Act 2013 Section 21 (2) and (3) deters the minister from extending the licences for the second year. Munya extended the permits last year to allow stability in the market in addition to establishment of necessary trading systems.  

Speaking on the approval, CMA chief executive Wyckliffe Shamiah said the agency is fully supportive of the reforms in the coffee sub-sector and is ready to execute its mandate as envisaged in the regulatory framework. “

As a result, these conditional licences are our commitment to ensuring that the trading of coffee continues at the NCE without disruption even beyond the June 30, 2021 deadline,” he said. 

The Authority granted a provisional license to NCE on July 1, 2020 to continue operating in its existing form as it worked towards full compliance with the Coffee Exchange Regulations. 

Shamiah added that the NCE’s in-principal approval has since been extended to December 31, 2021 to enable the Coffee Exchange to come into full compliance with the regulatory requirements.