ADVOKS GLOBAL · KENYA
Kenyan legislation
The Coffee (General) Regulations
Edition: 2022-12-31 · In force
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1. Citation and commencement
These regulations may be cited as the Coffee (General) Regulations and shall come into operation on such date as the Cabinet Secretary may, by notice in the Gazette, appoint.2. Interpretation
In these Regulations, unless the context otherwise requires—"Act" means the Crops Act (Cap. 318);"agent” means a person appointed by a grower to carry out any functions licensed under these regulations on behalf of the grower;"auction" means the system under which coffee is offered for sale at the Nairobi Coffee Exchange;"Authority" means the Agriculture and Food Authority established under Section 3 of the Agriculture and Food Authority Act (Cap. 317);“Board” means the Board of the Authority established under section 5 of the Agriculture and Food Authority Act (Cap. 317);"Cabinet Secretary” means the Cabinet Secretary for the time being responsible for agriculture;"certified coffees" means coffees produced under tenets of a recognized certification scheme bearing a certification mark;"coffee" means the plant botanically known as Coffea species (L.) and includes the fruit, whether on the plant or detached therefrom, the seed in form of either buni, parchment coffee, clean coffee, roasted beans or ground coffee;“coffee association” means a registered group comprised of coffee growers, either in co-operative societies or estates, coffee unions, coffee millers, traders, roasters, or companies, which has been registered by the Authority and given a registration certificate for purposes of these Regulations;“coffee branding" means the identification of coffee by defined characteristics, a specific name or origin;“coffee business" includes operating a coffee nursery, pulping, milling, warehousing, marketing, trading, roasting and packaging coffee;“coffee certification" means a system that distinguishes a coffee product as being sustainably grown on the basis of economic viability, environmental conservation, social responsibility and ensures traceability;“Coffee Directorate” means the directorate established in respect of coffee pursuant to section 11(4) of the Agriculture and Food Authority Act (Cap. 317);“coffee estate” means any area of land or group of parcels of land not being less than two acres in size in aggregate under the same ownership on which coffee is grown, or land which has an average production of not less than twenty thousand kilogrammes of cherry per year over a period of three years;“coffee miller” means a person licensed by the Authority in consultation with the respective county government to conduct the business of coffee milling;“coffee milling” means mechanical hulling or de-husking of parchment or buni coffee and includes the polishing and grading of the clean coffee;“coffee sales proceeds” means monetary consideration received in exchange for coffee purchased at the auction or through direct sales;“coffee roaster” means the holder of a roaster's license;“coffee standards” means the Kenya Coffee Standards issued by the Kenya Bureau of Standards;“coffee trader” means a person licensed to buy coffee at the Exchange or to import coffee;“coffee warrant” means an instrument prepared by the Exchange of which the person named therein, or the last endorsee thereof, shall for all purposes be deemed to be the owner of the coffee to which it relates;“coffee year” means a period of twelve months beginning on the 1st October of one year and ending on the 30th September of the following year;“collateral manager” means an institution appointed by the Authority to take custody of coffee at a licensed warehouse;“co-operative society” means a co-operative society registered under the Co-operative Societies Act;“county government” shall have the meaning assigned to it under Article 176 of the Constitution of Kenya;“dealing in coffee” means dealing with the crop within the meaning of the Act;“direct sale” means a contractual arrangement between a grower and a buyer for the sale of clean coffee based on mutually accepted terms and conditions enforceable in law based on the indicative price as recommended by the Pricing Committee;“Exchange” means the Nairobi Coffee Exchange or any other Exchange licensed by the Capital Markets Authority;“grower” means any person who cultivates coffee in Kenya and is registered with the County Government and the Authority;“grower miller” means a grower who mills parchment or buni from own holding and includes a co-operative society or union which mills its members' coffee;“inspector” means an inspector appointed by the Authority and includes a county agricultural officer designated by the Authority by notice in the Gazette;“licensee" means a person licensed by the Authority;“licensing authority" shall have the meaning assigned to it under the Act;“manufacturing” means processing coffee by pulping, milling and roasting;”out-turn number” means an identifying number issued by a miller in respect of coffee delivered to a mill;“out-turn milling statement” means a statement prepared by a miller after the completion of the milling process;“private miller” means a person who mills parchment or buni coffee from his or its own coffee estate;“primary processing” means the process of removal of coffee pulp from cherry, fermentation, washing and drying to the standard moisture content to obtain parchment;“prompt date” means a date specified in the sales catalogue, not being more than seven calendar days from the date of the sale, for the receipt of coffee sales proceeds by a broker from the trader;“pulping station” means a coffee factory or place where coffee cherry is processed into parchment coffee;“respective county government” means the government of the county within which the land where activities to which these regulations apply is situated;“sales catalogue” means a standard document prescribed by the Authority and prepared by a miller for sale of clean coffee at the Exchange;“settlement account” means an account by a grower in the central depository system operated by the Exchange into which all coffee sales proceeds are paid;“sweepings” means the balance of coffee samples in the sample room not distributed as samples to the traders and spillages collected from millers' milling activities which are handed over to the brokers for sale, provided that the proceeds accruing shall be paid to growers on pro-rata basis;“trading floor” means the physical space and all the facilities including; equipment, records and assets provided by or belonging to or in the use of the Exchange,'“warehouse” means a storage facility licensed by the Authority for the storage of coffee, and which is specifically designed to guarantee the quality and safety of the coffee;“warehouseman” means any person who owns, leases or is in charge of a warehouse where coffee is handled and stored for reward or profit;“warehousing receipt” means a certificate issued by a licensed coffee warehouseman in respect of coffee stored in a licensed warehouse for purposes of collateral.3. Purpose of the Regulations
The purpose of these regulations is to provide for the regulation, promotion and development of the coffee industry in Kenya.Part II – FUNCTIONS OF THE AUTHORITY
4. Functions of the Authority
(1)The Authority shall in the performance of its functions under these Regulations act through the Coffee Directorate, which shall carry out such activities and do such other things as are necessary to promote, develop and regulate the coffee industry for the benefit of coffee growers and the coffee industry.(2)In consultation with the respective county governments the Authority shall—(a)facilitate the issuance of coffee trade and manufacturing licenses;(b)co-ordinate training programmes for players in the coffee value chain;(c)enforce national regulations and quality standards in the coffee industry;(d)collect, collate and maintain information and data base on the coffee industry including current and future production, processing, marketing and consumption;(e)conduct market intelligence and promotion activities on Coffee both locally and internationally;(f)establish Iinkages with various government agencies including county government and private research institutions for the conduct of studies and researches designed to promote the production, marketing, processing and consumption of coffee;(g)develop and promote strategies and initiatives for value addition;(h)promote the application of the National Coffee Kenya Mark of Origin by local and international industry players;(i)recommend general industry guidelines for interaction between coffee farmers and manufacturers; and(j)promote the development of regional appellations for Kenyan coffee.(3)The Authority shall develop a Coffee Industry Code of Practice for all holders of licences under these Regulations.Part III – REGISTRATION AND LICENSING
5. Registration
(1)Every coffee grower shall register with the County Governments and the Authority for purpose of data collection.(2)A grower who joins a co-operative society or any other association or legal entity, shall notify the Authority through that co-operative Society or other entity;(3)The Authority shall maintain up-to-date registers of all coffee co-operative societies, coffee associations, coffee estates and nursery operators.6. Application for a licence
(1)Every person intending to engage in coffee business shall apply to the Authority or the County Government, as the case may be, using the respective application forms set out in the First Schedule, and shall be issued with the registration certificate or licence, as the case may be, in the corresponding forms set out in the same Schedule.(2)Every coffee dealer shall produce the certificate or licence respectively issued under subregulation (1) upon request by an inspector at all reasonable times.(3)The Authority shall maintain up-to-date records of all persons registered or licensed under this Regulation.7. Prohibition against operating without a licence
(1)No person shall, for commercial purposes—(a)buy, sell, pulp, mill, warehouse, export or otherwise deal in or transact any business in coffee unless he holds a current licence issued by the Authority or the respective County Government for that purpose;(b)transport or be in possession of any coffee unless he is licensed to carry out any of the activities specified in paragraph (a) and holds a valid movement permit issued—(i)in the case of parchment, by the licensing authority of the respective county; or(ii)in the case of clean coffee, by the Authority:Provided that—(a)where a grower applies for a licence under paragraph (a) in respect of own coffee, such licence shall be issued by the Authority without undue delay; and(b)paragraph (b) shall not apply to a grower moving own coffee between the farm and the pulping station.(2)An application for a movement permit in respect of parchment shall contain evidence of the competitive sourcing of the miller or other service provider to whom the coffee is intended to be delivered.8. Issuance of Licences
(1)The following certificates and licences shall be issued by the respective county government in consultation with the Authority—(a)a coffee nursery certificate authorizing the holder to operate a coffee nursery; and(b)a pulping station licence authorizing the holder to operate a pulping station who is a co-operative society, an association, a company or an estate grower.(2)The following certificates and licences shall be issued by the Authority in consultation with the respective county governments—(a)a coffee grower's milling licence authorizing the holder, being a co-operative society or other legal entity comprising growers, to pulp, mill, market or roast coffee;(b)a commercial miller's licence authorizing the holder to conduct the business of milling coffee at a fee.(3)The following licences shall be issued by the Authority—(a)a coffee roasters' licence authorizing the holder to conduct the business of roasting coffee for local sale or for export;(b)a warehouseman's licence authorizing the holder to conduct the business of warehousing coffee;(c)a coffee trader's licence authorizing the holder to buy clean coffee from the Exchange or import clean coffee from outside Kenya for processing in Kenya for sale locally or for export;(4)The licences issued under this Regulation shall be subject to such conditions as the issuing authority may prescribe.(5)A grower may enter into an agreement with other growers within the same county or region for purposes of accessing economies of scale in pulping, milling, warehousing, marketing or roasting coffee, and shall for that purpose—(a)apply for the necessary licences from the Authority; or(b)where the parties to the agreement already hold such licences, inform the Authority accordingly in writing.9. Limitation of a coffee trader’s licence
(1)A holder of a coffee trader's licence or any other entity associated with such holder shall not be licensed as a commercial miller or warehouseman.(2)The Authority may revoke any licence which is found to be held in contravention of subregulation (1).10. Conditions of licence
(1)The issuance of the licences specified under these Regulations shall be subject to the applicants meeting the respective requirements for such issuance set out in Part A of the Second Schedule and payment of the applicable fees as specified in Part B of the same Schedule.(2)The Authority shall not issue a licence under these Regulations unless the person meets the conditions for licensing.(3)All licensees shall specify the premises upon which the business specified in the license shall be conducted.(4)Every licensed person shall comply with the Coffee Industry Code of Practice.(5)Every licensee shall submit a letter of undertaking to remit returns to the Authority.(6)A license holder who contravenes the terms and conditions of the licence shall be liable to have his licence suspended or revoked.11. Licensing procedure
(1)The Authority may, after inspection and evaluation of an application received under these Regulations, grant the licence applied for or reject the application.(2)Where an application is rejected, the Authority shall notify the applicant accordingly, giving reasons for the rejection and pointing out the reasons leading thereto within fourteen days after the date of the decision of the Authority.(3)The applicant may resubmit an application following such rejection after addressing the issues raised in the notification from the Authority.(4)Where an application is rejected after resubmission under subregulation (3), the applicant may appeal to the Cabinet Secretary within thirty days after notification of the rejection by the Authority.(5)The Authority shall process the licences for successful applicants in accordance with the provisions of the Act.12. Duration of licences
Licences issued by the Authority shall expire on the 30th June of every year and license holders wishing for renewal thereof may apply by 1st June preceding the expiry of the license.13. Movement permits
(1)The movement of coffee shall be managed through the issuance of movement permits by the licensing authority of the respective county, provided that no movement permit shall be issued under these Regulations to any person other than a licensee, and the licensee shall not alter the particulars entered thereon.(2)No person shall move coffee or cause any coffee to be moved without an original movement permit issued by the Authority in accordance with subregulation (1).(3)Duplicate copies or photocopies of the original movement permit shall not be used for coffee movement.(4)Any vessel used for coffee transportation shall conform to Kenya Coffee Standards.(5)The movement permit for parchment from a pulping station operated by a Co-operative Society shall authorize such transportation to millers within the county or the next nearest miller in the interest of saving on costs.(6)The licensing authority shall monitor the movement of parchment coffee between stores and the movement of clean coffee and hulled buni to the market in order to ensure that the coffee is safe and to avoid any illegal coffee dealings.(7)Any person who moves coffee contrary to this Regulation commits an offence.14. Obligations of licensees
(1)Licensees under these Regulations shall observe the obligations set out in the Third Schedule.(2)The obligations set out in the Third Schedule shall be implied in every contract between a grower and a grower's agent.Part IV – COFFEE PRODUCTION AND PROCESSING
15. Notification after planting or uprooting coffee
(1)Every grower who plants or uproots coffee shall, within six months after doing so, notify the Authority or county government in writing of the area of coffee planted or uprooted for purposes of record.(2)Every grower who is a member of a co-operative society and who plants or uproots coffee shall, within three months of doing so, notify the co-operative society in writing of the area and number of trees planted or uprooted for purposes of record.(3)The co-operative society to which a report is made under subregulation (2) shall notify the Authority accordingly in every year after registering such details from the grower.16. Notification after change of details of farm or estate
Any grower who changes the details of his farm or estate as registered with the Authority, whether on a subdivision of the estate or otherwise, shall report such changes to the Authority for purposes of record.17. Coffee Production and processing standards
The Cabinet Secretary shall develop a coffee industry policy which shall articulate coffee production, processing and marketing practices towards adoption of modern coffee production and processing technology.18. Certification of Coffee
(1)The Authority shall promote coffee certification schemes for Kenyan coffee.(2)The certification schemes operating within the coffee industry shall be registered with the Authority.(3)Certified coffee shall be identified and labelled according to the respective certification schemes for traceability.(4)Coffee growers and millers may seek certification to ensure quality of service and market confidence.(5)Certified coffees shall be declared by the miller in the sales catalogues and sold in accordance with Guidelines for the Sale of Certified Coffees as provided by the Exchange.(6)The standard coffee grades shall be as provided in the Fourth Schedule.19. Prohibition in issuance of coffee seeds or seedlings
(1)No person, other than the Kenya Agricultural Livestock and Research Organization or its authorized agents operating laboratories or tissue culture units under their supervision, shall issue certified coffee seeds or seedlings for multiplication in any coffee nursery for distribution to any other grower or for export.(2)No person shall establish or operate a coffee nursery unless the person is registered with the respective county in consultation with the Authority.(3)A person shall not be issued with a certificate of registration for a nursery, unless an inspector—(a)visits and inspects the site and is satisfied that the site is suitable for establishment of a nursery; and(b)is satisfied that the nursery operator or their agents have adequate knowledge of nursery management and production techniques.20. Requirements relating to coffee milling
(1)The milling of coffee may be carried out by—(a)a coffee grower or grower's co-operative society, under a coffee grower's milling licence, or(b)a commercial miller under a commercial miller's licence.(2)Coffee milling shall only be conducted at premises that are specified as such in the register maintained by the Authority.(3)A miller shall ensure that the grower or grower's representative is notified and is present during the milling process.(4)A commercial coffee miller shall take out insurance cover against fire, theft and other risks for all coffee delivered for milling and for milled coffee which has not yet been handed over for marketing.(5)Every miller shall account for mill spillage or sweepings and all other coffee by-products to the Authority and the growers at such intervals and in such format as may be prescribed by the Authority.(6)The Authority shall from time to time prescribe the maximum proportion of milling losses allowable per parchment type and publicize the information in such a manner as to be easily accessible to the grower.(7)A grower who mills his own coffee shall ensure production and delivery records are submitted to the Authority in form C3 set out in the First Schedule.(8)For purposes of direct sales, a miller shall categorize and bulk coffee to meet specific market requirements as instructed by the grower and in the best interest of the grower.Part V – COFFEE TRADE AND MARKETING
21. Coffee marketing
(1)Kenya Coffee shall be traded through—(a)auction at the Exchange; andProvided that—(a)the prices offered at the direct sales shall bear a favourable comparison to those offered by the Exchange; and(b)the Exchange shall set aside one day in every fortnight for the trading of coffee by local traders.(2)The Authority shall set up a Pricing Committee comprising of seven members drawn from the National and county governments and the Exchange to propose indicative coffee prices based on the prices prevailing at the Exchange and in the international market and on the quality of coffee from the various coffee growing regions in the country.22. Coffee sales
(1)A coffee estate, co-operative society or other association may undertake direct sales of clean coffee from a licensed coffee warehouse and shall notify the Authority accordingly.(2)The notification under subregulation (1) shall contain the details of the contract of sale.(3)Direct sales shall be conducted in accordance with guidelines issued by the Authority.(4)The proceeds of the sale of coffee by auction or by direct sales shall be deposited in a central depository unit established by the Exchange in consultation with the Authority and which shall operate in accordance with the trading rules of the Exchange.23. Sales Catalogue
(1)Millers shall prepare a sales catalogue in consultation with the Exchange and growers for all the coffee transferred to a warehouse in accordance with the trading rules referred to in Regulation 22(4).(2)A sales catalogue shall contain the particulars set out in the Fifth Schedule.24. Coffee promotions
(1)The Authority shall co-ordinate coffee stakeholders, including growers and marketers, for the holding of international events for the promotion of Kenyan coffee in the international arena.(2)Respective county governments may mobilize growers for centralized coffee marketing in the overseas markets and conduct promotional activities both locally and internationally within the established legal framework.25. Coffee warehousing in designated warehouses
(1)All coffee shall be stored in warehouses duly licensed by the Authority in consultation with the county governments.(2)No premises shall be designated as a coffee warehouse by the Authority unless the premises are inspected, approved, and registered as such.(3)A licensed warehouse shall conform to the standards issued by the Kenya Bureau of Standards and shall be duly certified by a public health officer.(4)The Authority shall cause warehouses and warehousing activities to be inspected on a regular basis.(5)No warehouseman shall have a lien of any nature over coffee whether in his possession or not.(6)Every warehouseman shall insure all coffee in his warehouse or under his custody against fire, theft and other insurable risk.(7)No coffee shall be removed from a warehouse without a coffee warrant issued by the Exchange and registered with the warehouseman.(8)A person who operates a warehouse in contravention of this Regulation commits an offence.26. Export and import of coffee
(1)No person shall export coffee or cause any coffee to be exported unless a phytosanitary certificate of inspection is presented to the Commissioner of Customs and Excise along with a certificate of origin or a certificate of re-export, as the case may be, relating to such coffee.(2)No coffee grown outside Kenya shall be entered into Kenya in transit for export unless accompanied by a certificate of origin.(3)No coffee imported into Kenya shall be re-exported in any condition or quantity other than that in which it was imported into Kenya except with a certificate of re-export.(4)A certificate of origin for coffee produced outside Kenya shall be valid only if issued by the certifying agency of the relevant country and endorsed and completed by the relevant government agency of that country.(5)A certificate of origin for coffee grown in Kenya, and any certificate of re-export for coffee grown outside Kenya but re-exported from Kenya, shall be issued only by the Authority.(6)The Authority shall authorize and monitor the importation of coffee into Kenya.27. Prohibition against misrepresentation of blended coffee
(1)A person who blends any or various grades of coffee produced in Kenya with any other coffees produced outside Kenya shall not represent such coffee as coffee having its origin in Kenya.(2)Any person who contravenes the provisions of this regulation commits an offence.28. Coffee Warrant
(1)A warehouseman shall, after every sale of coffee and upon confirmation of payment, issue to the purchaser a coffee warrant in such form, and containing such details of the coffee purchased, as the Authority may prescribe.(2)No person shall alter any certificate of origin, certificate of inspection or certificate of re-export, coffee warrant, warehouse receipt or other document prepared for purposes of these regulations.29. Exemption
Nothing in these regulations shall apply to the export or dispatch of any coffee when the coffee concerned—(a)consists only of a sample or a parcel not exceeding twenty kilogrammes in weight; or(b)is for consumption on ships, aeroplanes or other international carriers.30. Activities of the Authority
The Authority shall carry out activities for purposes of—(a)advertising the merits of Kenyan coffee and increasing its sale to expand existing markets and entering new markets and matters incidental thereto;(b)promotions, exhibitions and trade fairs for the display of the Kenya coffee in the domestic and international markets;(c)collection and dissemination of statistics and other information relating to Kenya coffee and its production, distribution and consumption;(d)regulation and compliance activities;(e)promotion of product diversification and value addition; and(f)any other lawful purpose for the development of the coffee sub-sector.Part VI – QUALITY ASSURANCE
31. Quality Assurance for Coffee Industry
(1)The Authority shall establish and enforce standards in grading, sampling and inspections, tests and analysis, specifications, units of measurement, code of practice and packaging, preservation, conservation and environmental sustainability and transportation of coffee.(2)The Authority shall develop a training curriculum and conduct examinations for coffee liquorers in consultation with industry stakeholders.(3)Liquoring certificates shall be issued by the Authority to persons who pass the liquoring examinations in accordance with these regulations.(4)Any qualified person intending to offer liquoring services shall apply to the Authority for certification.(5)The Authority shall develop guidelines for the establishment of independent cupping centers at the counties for the purpose of coffee quality analysis and maintenance.(6)Coffee quality analysis at the cupping centers shall be carried out only by certified liquorers.(7)Quality Assurance officers from the Authority may whenever the need arises, carry out assessments on coffee quality maintenance at any premises that handles coffee, along all stages of the value chain.(8)The Authority shall demand evidence of engagement of a registered coffee liquorer by a miller or trader licensed under these regulations.32. Appointment of inspectors
(1)The Authority may appoint inspectors to conduct independent inspection of a grower's farm, a mill warehouse or the premises of a coffee trader to ascertain whether the requirements of the Act and these regulations are being complied with.(2)In carrying out an inspection under subregulation (1) the inspectors shall—(a)monitor activities along the value chain of coffee to ensure compliance with set regulations and standards;(b)undertake inspections to ensure compliance with these regulations;(c)ensure that all people dealing with coffee adhere to the conditions of registration and licensing set out in the Second Schedule.(3)An inspector shall work in collaboration with the County executive committee member for agriculture of the respective county in the discharge of functions under this regulation.(4)A grower, miller, warehouseman or trader shall afford the inspector full and free access and all necessary assistance to any such inspector during the inspection.(5)No coffee grower, miller, agent, trader, or warehouseman or their agents shall deny entry to an inspector acting in the course of that inspector's duty or obstruct an inspector from making an entry or conducting an inspection of a mill or other premises.33. Prohibition against removal of labels, seals, etc.
No agent or person employed by an agent shall, otherwise than with express written authority of a grower, remove labels or seals or open technically sewn or closed packets of coffee unless for the purpose of inspection to determine their validity and genuineness or with other reasonable cause.34. Surveillance
The Authority shall conduct periodic surveillance within coffee-growing counties and among millers, processing plants, warehousing facilities, retail outlets, export points, and exporters' premises to assess the degree of compliance with the coffee industry policy, standards, code of practice and the general well being of the coffee industry.Part VII – GENERAL PROVISIONS
35. Arbitration
Where any dispute arises between any two or more persons licensed or registered under these Regulations, the dispute may be resolved through arbitration or relevant rules made by the Cabinet Secretary.36. General penalty
(1)A person who contravenes any provisions of these Regulations commits an offence.(2)A person who commits an offence under these Rules for which no other penalty is provided shall be liable to a fine not exceeding five hundred thousand shillings or to a term of imprisonment not exceeding one year or both.37. Revocation
The Coffee (General) Rules 2002 are revoked.38. Transitional
(1)Notwithstanding Regulation 37—(a)all licenses for coffee business existing before the coming into operation of these regulations shall remain valid until their expiry, and shall thereafter be renewed under these Regulations;(b)all marketing agent and dealers' licences in force immediately before the operationalization of these Regulations shall remain valid until the 30th September, 2016.(c)any person who immediately before the coming into operation of these regulations was an agent for a grower may upon such operationalization apply to the Authority for licensing under these Regulations ;(2)The Authority shall within a period of ninety days after the operationalization of these Regulations put in place a mechanism for the discharge of all liabilities attaching to or in respect of any of the institutions concerned with the growing, milling or marketing of coffee immediately before the operationalization.