What happened

On Wednesday, President William Ruto directed the Kenya Revenue Authority (KRA) to publish a list of goods that will be excluded from cargo consolidation rules at the port of Mombasa. This move follows a recent shutdown by a major clearing and forwarding firm, which disrupted operations at the port and highlighted delays caused by consolidation enforcement. The directive aims to reduce bottlenecks, lower costs for traders, and improve the efficiency of cargo clearance in Kenya’s largest port.

Context and background

The port of Mombasa handles over 90% of Kenya’s international trade and acts as a gateway for goods destined for Uganda, Rwanda, Burundi, and eastern DRC. Consolidation—where multiple small consignments are grouped into a single declaration—was introduced in 2021 to simplify customs clearance and reduce paperwork. However, consolidation has been blamed for adding delays, increasing costs, and creating uncertainty for small and medium-sized importers. The recent shutdown by a major clearing agent exposed these frustrations, prompting President Ruto to intervene directly.

The cargo consolidation system was part of a broader customs modernization push led by KRA under the Kenya TradeNet Single Window system. While consolidation aimed to streamline import declarations, traders have reported inconsistencies in how consolidation is applied. Some consignments that should be exempted—such as perishable goods, medical supplies, and plant products—are still being consolidated, leading to delays and spoilage. In response, the President ordered KRA to publish an “excluded goods list” to clearly define which products will not be subject to consolidation, thereby reducing unnecessary delays and costs.

The directive from State House comes at a time when Kenya’s trade community is under pressure from rising operational costs, volatile fuel prices, and competition from regional ports. The shutdown by the clearing firm, described in local media as a protest against consolidation enforcement, lasted several days and disrupted hundreds of shipments, particularly those with tight timelines such as fresh produce and pharmaceuticals. This event appears to have accelerated the government’s decision to revise consolidation rules and improve transparency.

Compared with what is normal

The port of Mombasa processes an average of 1.3 million twenty-foot equivalent units (TEUs) of cargo annually, with peak volumes during the first and fourth quarters of the year. Consolidation was introduced to reduce the number of declarations from thousands per day to several hundred consolidated entries. While consolidation has reduced paperwork in some cases, it has also increased the average clearance time for certain consignments by 2 to 3 days compared to pre-2021 levels, according to industry estimates.

Under the new directive, goods such as fresh fruits, vegetables, flowers, and pharmaceuticals are expected to be exempted from consolidation. These categories have high time sensitivity and low tolerance for delays. Traditionally, such perishable goods were handled under expedited clearance mechanisms, but consolidation rules have blurred these distinctions. The government’s move to publish an explicit list aligns with a broader trend in East Africa, where Rwanda and Uganda have already introduced similar exemptions to reduce clearance times and improve trade competitiveness.

In Kenya, the average dwell time for import containers at Mombasa port is about 4 days, which is higher than in Durban (3 days) and Dar es Salaam (3.5 days). The port authority attributes this partly to compliance checks and consolidation enforcement. The new exclusion list is expected to bring Kenya closer to regional benchmarks by reducing unnecessary delays for high-priority goods.

Why it matters

For Kenyan businesses that import perishable goods, pharmaceuticals, or time-sensitive industrial inputs, the consolidation system has been a source of frustration. Consolidation increases the risk of delays, which can lead to spoilage, penalties for late delivery, and higher storage costs. Small and medium-sized enterprises (SMEs) are particularly vulnerable, as they often lack the cash flow to absorb unexpected storage fees or penalties. The President’s directive signals a recognition of these real-world costs and a shift toward more tailored clearance processes.

For logistics companies and clearing agents, the consolidation rules have created operational uncertainty. Some agents have reported that consolidation enforcement is inconsistent, with some consignments being consolidated despite meeting exemption criteria. This unpredictability makes it harder to plan logistics and increases the cost of doing business. By publishing a clear exclusion list, KRA aims to reduce disputes and give traders and agents a predictable framework for clearance.

The timing of the directive is also significant. Kenya’s economy is recovering from post-pandemic disruptions, and inflation remains a concern. Rising import costs—fueled by high freight rates, fuel prices, and port charges—are squeezing profit margins across sectors. Reducing clearance delays for key imports can help lower costs for wholesalers, retailers, and manufacturers, which in turn can ease pressure on consumer prices. This aligns with the government’s broader goal of improving the ease of doing business and supporting local industries.

For the port of Mombasa itself, efficiency gains are critical. The port is a major employer and contributes significantly to Kenya’s GDP. Prolonged delays and shutdowns risk damaging Kenya’s reputation as a regional trade hub, which could divert cargo to Dar es Salaam or Djibouti. The directive sends a signal to investors and trading partners that Kenya is committed to resolving operational bottlenecks and improving trade facilitation.

Practical steps

• Review your consignment categories: Check whether your typical imports are likely to be included in the upcoming KRA exclusion list. Focus on perishables, pharmaceuticals, and sensitive industrial inputs.
• Engage your clearing agent early: Confirm with your agent how the new exclusion list will be applied to your shipments. Ask for clarity on any grey areas, especially if your goods fall near the boundary of an exemption.
• Plan for shorter clearance windows: If your business relies on just-in-time deliveries, prepare for potentially faster clearance once the list is published. This may reduce your need for extended storage or buffer time.
• Monitor KRA announcements: The exclusion list will be published by KRA. Set up alerts or check the KRA website and Kenya TradeNet portal regularly for updates beginning this month.
• Budget for lower clearance costs: With faster clearance expected for exempted goods, factor in potential savings on storage, demurrage, and penalties in your next quarterly financial plan.

What to expect next

The KRA is expected to publish the exclusion list within the next two weeks, following technical review and stakeholder consultations. Once published, the list will be integrated into the Kenya TradeNet Single Window system, so declarations for excluded goods will automatically bypass consolidation rules. The government has indicated that the list will be reviewed periodically to reflect changes in trade patterns and seasonal demand.

In the meantime, traders and clearing agents are advised to prepare for potential short-term disruption as the system adjusts. The port authority has also indicated that additional staff may be deployed to process exempted consignments faster, but the full impact will depend on how consistently the rules are applied.

This move reflects a broader trend in East African trade facilitation, where governments are rethinking customs procedures to improve competitiveness. Similar reforms are under way in Tanzania and Uganda, where consolidation exemptions have already reduced clearance times for key sectors.

For Kenya, the success of this initiative will depend not only on the clarity of the exclusion list but also on the capacity of KRA staff and the port authority to implement the changes efficiently. Given the strategic importance of Mombasa port, getting this right could strengthen Kenya’s position as a regional logistics hub and support economic recovery.

Tax Planning & Compliance

If your business regularly imports goods that may now be exempt from consolidation, it’s important to review your customs clearance processes and tax compliance strategies. Adjusting your declarations and documentation in line with the new rules can help you avoid penalties and reduce costs.

Talk to our team at Beavoren Ventures — info@beavorenventures.co.ke — to set up your systems correctly.

Disclaimer: This article is informational and does not constitute formal tax, audit or legal advice. For guidance specific to your circumstances, please contact Beavoren Ventures.