Local scrap metal dealers will be required to apply for fresh operating licenses from the Scrap Metal Council once a raft of new measures, seeking to regulate the sector, are enacted into law by the Office of the Attorney General.
The measures, which likewise recommend special vetting of all copper dealers in the country, will see the Numerical Machining Complex, a government-owned body, given sole rights to trade in scrap metal disposed from critical infrastructure projects.
“In the proposed regulations, licensed dealers, millers and smelters will be charged Sh250,000 in annual fees while the amount for agents and jua kali collectors will be Sh150,000 and Sh50,000 respectively,” Interior Cabinet Secretary Fred Matiang’i said in a statement.
Matiang’i who chaired a briefing meeting on the regulations attended by the scrap metal dealers and regulatory agencies in the sector warned that the lifting of the moratorium will be pegged on compliance with the new regulations.
“We are not going to allow the sector to continue operating in unlicensed manner and no amount of political intimidation or pressure will make us abandon the resolve. We are not building infrastructure for scrap metals vandals. We’d rather the scrap business died but we managed to protect our critical infrastructure,” the CS said
Attorney General Kihara Kariuki said he will advise the President against withdrawing the moratorium until majority of the dealers complied with the regulations.
According to CS Matiang’i, a special multi-agency unit had been set up to protect power lines and other critical installations. Under deterrence measures announced in January, vandals will be treated as economic saboteurs and charged under the counter-terrorism laws.
Trade CS Betty Maina said only 20 scrap metal dealers are officially licensed in the country while 91 others have their applications pending. Over 3,900 other operators are essentially operating in the sector illegally.
Energy PS Maj-Gen (Rtd.) Gordon Kihalangwa said on average, 10-15 transformers were being vandalized in the country every week while the cable line supplying power to the Nairobi Central Business District from Embakasi was recently stolen to feed illegal trade in copper.
Losses of transformers have however been cut to around seven per week under new security arrangement that placed power installations under the supervision of country security teams chaired by county commissioners.
Dealers must prominently display the name and license number of their businesses outside their facilities and keep receipts detailing the nature of the scrap metal, its source, previous use and the registration details of the vehicle and the driver delivering it if it’s ferried to the premises.
They will also be required to belong to a Business Member Organisation (BMO) and obliged to ensure they only trade with licensed dealers when sourcing or selling their stock.
To transport scrap metal, dealers will have to carry a copy of their license and obtain a letter authorizing the vehicle to carry the load that must declare details of source and destination, type and quantity and name, ID and contact details of the driver.
If the NMC is unable to absorb scrap metal disposed from a critical infrastructure, the regulations propose that the management of the infrastructure be required to engage a local smelter directly without involving a broker.
The briefing meeting was also attended by the Inspector General of Police Hilary Mutyambai, and representatives from the Directorate of Criminal Intelligence (DCI), the Kenya Revenue Authority, Kenya Railways, road authorities, Kenya Association of Manufacturers and various scrap metal dealers’ associations.