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Tobacco Bill reignites county-national row over business licences
A farmer on his tobacco farm in Kavalula village, Kitui County, on April 7, 2026. Tobacco manufacturers and traders are opposing proposals that would require county governments to issue licences to all dealers in tobacco and nicotine products.
The overlapping mandates between county and national governments are back in the spotlight amid a fresh row over proposed tobacco control laws, adding to a growing list of disputes over the cost of doing business.
Overlapping roles in the Fourth Schedule of the Constitution have, over the years, triggered conflicts between the national government and devolved units in key areas such as public health management, business licensing and revenue collection, public land, and physical planning.
For instance, farmers in counties including Kiambu are locked in court battles over what they term ‘double taxation’ by the two levels of government on farm produce such as tea, coffee and milk. There have also been frequent clashes between county and national governments over the procurement of medical equipment, management of health workers and the development of key infrastructure such as roads.
In 2025, telecommunications companies in Kenya flagged high county levies as a deterrent to business. A report by the Communications Authority of Kenya (CA) showed that counties were charging more than Sh200,000 annually to allow mobile network operators to set up a single communication mast, increasing operating costs given that firms already pay licence fees to the national government through the CA and other regulatory agencies.
Turf wars
A fresh conflict is now simmering over regulation of the multi-billion-shilling tobacco industry, with the Tobacco Control (Amendment) Bill 2024 proposing mandatory licensing by county governments for all dealers in tobacco and nicotine products, including manufacturers, importers, distributors and retailers.
Manufacturers and traders have opposed the proposal, terming it duplicative of the role already played by the Ministry of Health and warning that it will increase the cost of doing business while fuelling illicit trade.
“These proposals run against the Government of Kenya’s commitment to facilitate the ease of doing business, and risk creating significant disruption for compliant enterprises. This provision introduces unnecessary regulatory duplication, higher compliance costs, and administrative inefficiencies,” the Kenya Association of Manufacturers (KAM) said in its submission to the Senate on the Tobacco Control (Amendment) Bill 2024.
“Further, layering multiple licensing requirements at both national and county levels is likely to result in inconsistent enforcement, regulatory uncertainty and barriers to formal trade, while inadvertently incentivising illicit trade growth, which is already estimated to account for nearly half of the market,” it added, urging that the provision be deleted from the Bill.
The Kenya National Chamber of Commerce and Industry (KNCCI) also criticised the additional regulations, terming them counterproductive.
“The Chamber’s position is that regulating the same commercial activity through parallel approval regimes risks duplication, increased compliance costs and fragmented enforcement across multiple authorities,” it said.
“From a business continuity perspective, duplicative licensing requirements create uncertainty for traders who are already subject to a variety of obligations under county trade licensing regimes, national standards, tax administration rules and sector-specific controls,” KNCCI chief executive Kenneth Mutahi said in submissions to the Senate.
Constitutional grey areas
The rising regulatory conflicts are partly tied to provisions in the Constitution. The Fourth Schedule, which outlines the distribution of functions between the national and county governments, grants devolved units responsibility for trade development and regulation, including markets, trade licences (excluding regulation of professions), fair trading practices, local tourism and cooperative societies.
The Fourth Schedule also grants the national government regulatory powers over critical areas such as health policy, placing the tobacco industry at the centre of a dispute over overlapping mandates between the two levels of government.
“There are grey areas in law on the roles of the two levels of government that need to be addressed. Many economic sectors have raised concerns about being caught up in overlapping regulations,” said John Otieno, a business analyst.
A regulatory audit report released by KAM in March 2026 revealed a heavy burden on businesses arising from duplicative actions by national and county governments.
“The cumulative regulatory burden on manufacturers has grown significantly over time. In some manufacturing sectors, businesses must obtain more than 50 licences, permits, fees and charges from multiple regulatory agencies at both national and county levels,” KAM chief executive Tobias Alando said during the launch of the report on March 10, 2026.
British American Tobacco Kenya Plc (BAT Kenya) has also called for a review of the proposed issuance of permits by county governments for all dealers in tobacco and nicotine products.
“For example, the proposed additional licensing requirements will impose additional costs and complexity, which is burdensome, particularly for some small traders whose livelihoods depend on the sector,” BAT Kenya managing director Crispin Ochola said in a submission to the Senate.
Regulatory clash
Beyond the overlapping mandates of national and county governments, industry players also pointed to conflicting regulations within the national framework, particularly proposals in the Tobacco Control Bill 2024 aimed at tackling plastic pollution.
The Bill proposes a ban on the use of single-use plastics.
“While the objective of addressing plastic pollution is acknowledged and supported, the proposed approach raises significant concerns from a regulatory coherence and policy alignment perspective,” KAM said.
Manufacturers noted that Kenya already has a comprehensive environmental governance framework under the Environmental Management and Co-ordination Act (EMCA), which provides an economy-wide mechanism for managing plastic waste and packaging materials.
“This framework is operationalised through binding subsidiary legislation, including the Extended Producer Responsibility (EPR) Regulations, 2021, and the Management and Control of Plastic Packaging Materials Regulations, 2024. These regulations apply uniformly across all sectors and impose clear obligations on producers, importers and retailers,” the lobby said.
Manufacturers added that the current framework includes mandatory registration with the National Environment Management Authority (Nema), financing of collection and recycling schemes, licensing of plastic packaging materials, traceability requirements and the progressive redesign of packaging to support circular economy outcomes.
KAM argued that introducing a sector-specific statutory ban within tobacco legislation risks creating regulatory fragmentation.
“It would effectively subordinate EMCA’s coordinating role by singling out one sector for an outright prohibition, while other sectors remain governed by harmonised, proportionate controls under existing environmental law,” it said.
“Such an outcome undermines policy consistency and introduces unnecessary legal misalignment. Further, the proposed ban does not sufficiently take into account ongoing regulatory implementation processes being led by Nema. Nema has consistently communicated that enforcement will focus on EPR compliance, licensing of plastic packaging, and operational take-back schemes,” the lobby added.
KAM warned that the proposed ban would disrupt the agreed compliance pathway and create uncertainty for manufacturers, distributors and retailers.
Industry pushback
As part of its opposition to the Bill, BAT Kenya is also seeking a review of the proposed prohibition of additives and flavours, arguing that it would fuel illicit trade.
The company said flavour bans have failed in several European countries, including the Netherlands, Estonia and Denmark, and have instead fuelled black-market activity and increased access by underage consumers.
“If a regulation in effect for 12 years has been found ineffective, overly complex and unenforceable by 27 European jurisdictions, it is extremely ill-advised to pursue a similar failed approach in Kenyan regulation,” BAT Kenya said.
“Excessively restricting the range of available flavours, through restriction of ingredients or outright banning additives which result in a characterising flavour, could also push smokeless product consumers into an illegal, unregulated market, encourage potentially dangerous home-mixing of flavours or motivate them to return to smoking,” Mr Ochola said.
