Uganda's New Directive Deals Blow to Kenyan Car Dealers

  • Cars at a yard awaiting auction.
    Cars at a yard awaiting auction.
    File
  • The Ugandan government has relaxed conditions set for the importation of vehicles dealing in the country but at the same time dealing a huge blow to Kenyan dealers.

    Whereas Kampala has increased the age of vehicles to be cleared under the East Africa Community Single Customs Territory, Kenyan motor dealers have argued that this will see an influx of very old and worn-out vehicles into the market. 

    Initially, Uganda had set nine years as the age of vehicles to be cleared under the common market protocol but the Uganda Revenue Authority (URA) has since increased this to 13 years.

    According to URA, vehicles aged from 13 years and below since the date of manufacturing are the only ones that will be subjected to the common market custom rules.

    The Kenya-Uganda Border Post.
    The Kenya-Uganda Border Post.
    File

    “The general public is hereby informed that effective July 1, 2022, motor vehicles that are 13 years and above from the date of manufacture shall no longer be cleared under the warehousing system."

    “The public notice shall apply to motor vehicles categorized under part (b) of the fourth schedule of the Traffic and Road Safety Act, 1998 (Amendment) Act (TRSA) in accordance with Section 14B of the TRSA.

    "Consequently, motor vehicles that are nine to twelve years old shall be warehoused for a period not exceeding six months in accordance with Section 57 of the East Africa Community Customs Management Act, 2004," read part of the URA statement. 

    The move, according to Kenyan motor vehicle dealers, increases the likelihood of vehicle smuggling into the local market.

    “The earlier directive by URA had given us some hope of progressively ending the smuggling menace, especially of models such as Toyota Spacio, Toyota Wish, Toyota Premio, and Toyota Alphard. The new directive kills our hope,” a car dealer in Nairobi told Nation Africa.

    He pointed out that older vehicles find their way into the Kenyan market after being imported through Uganda where the importer declares low custom value.

    Kenya is currently the only country in the East African region with strict age limits on vehicle importation hence making it an expensive affair for dealers bringing cars into the country. 

    Used cars yard.
    A used cars yard.
    File