Auditor General Nancy Gathungu has warned that a Sh603 million legal proceeding against Anti-Counterfeit Authority could impact negatively on operations of the agency.
In her report for the year ended June 30, 2022, Gathungu said a review of records revealed pending legal proceedings against the agency that may, if successful, have a significant impact on its operations.
She said the Sh600 million case was about a person accused of possession of counterfeit electric bulbs and accessories but was acquitted of the charges in a court of law in 2015.
“However, the accused person and others instituted a civil case at Milimani Law Courts in 2016 seeking special damages of Sh603, 500, 000 against the authority for unlawful arrest, malicious prosecution and destruction of property,” she said.
Gathungu noted that although the authority released part of the goods seized to the accused persons in July 2015, they complained that the remaining goods had been destroyed and they could not take the destroyed or damaged goods.
The Auditor General further noted that there are five civil cases with a contingent liability of Sh6.3 million which had adverse rulings but the authority appealed against the judgements.
“In the circumstances, the financial effect of the outcomes of the pending legal proceedings against the authority could not be determined,” she said.
The Anti-Counterfeit Authority was established under the Anti-Counterfeit Act 2008 as a State corporation with the mandate to enlighten and inform the public on matters relating to counterfeiting.
It is mandated to combat counterfeiting, trade and other dealings in counterfeit goods, and devise and promote training programs to fight the vice with national, regional or international organisations.
It is within the Ministry of Investment, Trade and Industry.
Although the Act was passed by Parliament in 2008, it came into force on 1 July 2009 with the principal aim of prohibiting trade in counterfeit goods. The Authority came into operation in June 2010.
