The gap between East Africa’s integration rhetoric and its practical trade reality is usually measured in years. This time, however, it was measured in mere hours.
Just one day after Tanzanian President Samia Suluhu Hassan and Kenyan President William Ruto stood side-by-side in Dar es Salaam and pledged to eliminate all remaining non-tariff barriers (NTBs) between their nations by June 30—Kenya published its Finance Bill 2026. Buried within the amendments to Kenya’s Excise Duty Act was a proposal to impose a 35 percent excise duty on glass bottles originating from East African Community (EAC) partner states. This measure effectively strips away a tax exemption that Kenya’s own Parliament had legislated in 2021 after losing a court case it should never have needed to fight.
While the product at the center of this dispute—glass bottles—may seem unglamorous, the legal and regional principles at stake certainly are not. Kioo Limited, Tanzania’s leading glass manufacturer, supplies approximately 40,000 metric tonnes of glass bottles to Kenya annually, accounting for roughly a third of Kenya’s total container glass demand.
Back in 2020, Kenya introduced a 25 percent excise duty that captured EAC-origin glass within its scope. In response, Kioo Limited took the matter to the East African Court of Justice (EACJ), arguing that the tax was discriminatory and inconsistent with Kenya’s obligations under both the EAC Treaty and the Customs Union Protocol.
The regional court agreed with the manufacturer and suspended the implementation of the tax. Consequently, Kenya’s Parliament amended its Excise Duty Act through the Finance Act 2021, expressly exempting EAC-origin glass bottles from the duty. The newly proposed Finance Bill 2026, however, seeks to delete that very amendment entirely.
Kioo Limited exports approximately $22 million worth of glass bottles to Kenya each year. The proposed 35 percent duty would add an estimated $7.7 million cost burden—effectively a one-third surcharge on goods that currently cross the border duty-free. The fact that the bill carves out an exception exclusively for pharmaceutical packaging confirms that this policy was a deliberate legislative choice rather than a drafting error.
From a legal standpoint, Kenya’s position is notably weak. The EAC Customs Union Protocol explicitly prohibits member states from imposing internal duties on goods that meet the established EAC Rules of Origin. Furthermore, the EACJ has already interpreted and ruled on Kenya’s obligations regarding this exact product. Legally, a regional court ruling does not simply expire because a country drafts a new domestic Finance Bill.
Kioo Limited has indicated that it is actively exploring its legal options, including a return to the EACJ. The manufacturer has also formally petitioned Tanzania’s ministries of foreign affairs, finance, and trade to intervene through diplomatic and regional channels.
On the current facts, a second legal challenge by the Tanzanian exporter would likely succeed. However, the more critical question is why Tanzania’s largest glass exporter should be forced to litigate the exact same right twice.
Legal and business practitioners advising cross-border enterprises across the region note that this flip-flop creates severe anxiety among private sector clients—whether Tanzanian, Kenyan, or international. The overarching concern is whether regional trade commitments hold any weight when they become commercially or fiscally inconvenient for a member state.
For a business making a cross-border investment decision, knowing that a favorable court ruling will not simply be reset by the next domestic Finance Bill cycle is paramount. Without that legal certainty, the risk premium on regional operations rises, deal timelines lengthen, and capital that might have stayed within East Africa will look elsewhere.
This ongoing “litigation tax” on regional trade falls heaviest not on massive corporations with the resources to repeatedly return to court, but on smaller operators who must either absorb the extra costs quietly or exit the market altogether.
Fairness requires acknowledging that Tanzania carries its own imperfect track record regarding NTBs into this conversation. Its 2025 restrictions on foreign nationals within designated service categories—sectors where EAC Common Market Protocol commitments on services should apply—drew legitimate and heavy criticism from Kenya and others in the region. Regional integration remains a reciprocal obligation.
No member state occupies the absolute moral high ground regarding trade barriers, and Tanzania’s government is well aware of this. However, reciprocal imperfection does not dissolve binding treaty obligations.
If Kenya’s Finance Bill passes in its current form, it represents a blatant breach of a protocol that Kenya has already been legally found to have violated on the exact same question. The original EACJ ruling still stands, as does the 2021 domestic amendment.
With the June 30 NTB deadline set jointly by both heads of state now just three weeks away, the timeline has become something much larger than a bilateral trade milestone. It has transformed into a critical stress test of whether EAC integration commitments can survive contact with domestic fiscal pressures.
