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Regulator lists landmark suits shaping stock market :: Kenya



The Capital Markets Authority (CMA) and the National Council for Law Reporting (NCLR) have launched a compilation of judicial decisions on the regulator.

Digest of Decisions on Capital Markets highlights 27 cases, which have culminated in a body of law that guides the operations of the capital markets in Kenya. 


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A number of prominent cases that have fundamentally transformed the landscape of the capital markets -that have been reported -include the famous Peter Muthoka vs CMC Holdings Ltd and 12 others.

The case gave the CMA power to recommend the appointment of an interim board to run the affairs of a listed company in order to restore investor confidence.

Also featured is the Capital Markets Authority vs Jeremiah Gitau Kiereini, and another in which it was decided that CMA has the dual mandate to investigate and take enforcement actions against directors of listed companies.

Not all cases were decided in favour of the regulator. In the Republic vs Benard Mwangi Kibaru Criminal Case No 1337 of 2008 November 25, 2010, the court ruled that an employee of a company who attends the company’s board meetings and who sells his shares is not guilty of insider trading if his decision was based on information in the public domain.

Mr Kibiru was an employee of the now cash-strapped Uchumi Supermarkets. As the head of Buying and Merchandising Department, he regularly attended the board meetings of Uchumi by invitation.

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On April 26, 2006, he sold his 111,400 shares, a move that saw him charged with the offence of insider trading.

Those likely to benefit from the digest include market players, legal practitioners, magistrates, judges, judicial officers, law students and other stakeholders in the capital markets, according to CMA Chairman James Ndegwa.

“It is envisaged that the digest will be regularly updated and re-issued as local jurisprudence on the operation and regulation of capital markets continues to grow and evolve,” said Mr Ndegwa in the report.


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“I am confident that the digest will help, not only in the crystallisation of the law and principles guiding capital markets operation and regulation in Kenya but also contribute to deepening understanding of the unique legal and regulatory environment in which the capital markets operate globally.”

“The authority trusts that this digest will go a long way to demystifying some of the myths and misconceptions on the operations of capital markets,” added Paul Muthaura, CMA chief executive.

The digest covers a 10-year period from 2008 to 2018 and is indexed into seven categories covering civil cases, civil appeals, constitutional petitions, judicial review applications, miscellaneous applications, civil suits and criminal cases.

A number of highlighted cases, however, are currently the subject of appeals.

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