Mombasa-based businessman Mohamed Jaffer has lost a decades-long monopoly in grain handling at the Mombasa Port. This loss comes as a result of a recent Court of Appeal ruling that overturned a High Court decision, allowing for the establishment of a second-grain handling facility, thus opening up competition for Jaffer’s company, Grain Bulk Handlers Ltd (GBHL).
The Court of Appeal’s decision marks the end of a 24-year era of monopoly in grain handling at the Mombasa Port, previously enjoyed by Jaffer’s GBHL. The ruling paves the way for Portside Freight Terminals to establish a competing facility, signaling a shift towards increased competition in the grain handling sector.
Court of Appeal’s decision alters grain handling landscape, prioritizing competitive markets at ports
Judges Pauline Nyamweya, Imaana Laibuta, and George Odunga of the Court of Appeal found that the High Court had erred in halting the Kenya Ports Authority’s (KPA) contract with Portside Freight Terminals.
Nyamweya, Laibuta, and Odunga ruled that awarding the contract to Portside was non-discriminatory and in compliance with constitutional provisions. This decision reshapes the grain handling landscape at the port, emphasizing the judiciary’s commitment to fostering a competitive market in Kenya.
Operational challenges: Jaffer’s enterprises navigate rising competitive force
The legal battle between Jaffer’s GBHL and Portside Freight Terminals underscores a broader trend of heightened competition in the operational landscape and market where Jaffer’s conglomerate and its business units operate.
This recent court action follows a previous clash in the cooking gas market between Jaffer’s Africa Gas and Oil Ltd. and Tanzanian billionaire Rostam Aziz, highlighting the increasing competitive pressures faced by Jaffer’s enterprises.
Mohamed Jaffer’s entrepreneurial journey spanning car dealerships to grain handling dominance at Mombasa Port
Jaffer’s entrepreneurial journey, from establishing his first business in 1968 to navigating various industries, including car dealerships, pallet manufacturing, and container business, provides context to his dominance in grain handling at the Mombasa Port.
Despite facing challenges in obtaining permissions from the Kenya Ports Authority, Jaffer eventually secured the rights to operate in grain bulk handling in 1992, positioning his company as a regional player in cargo handling services.
The Court of Appeal’s decision to overturn Jaffer’s 24-year grain handling monopoly at the Mombasa Port signals a major change in market dynamics. It aims to boost competition, potentially leading to better services and lower costs for milling companies and consumers.Â
