Kenyan insurance brokers hit hard by Tanzania’s two-thirds rule

bartaizo said:
Ujinga

2 Timotheo:4.2
lihubiri neno, uwe tayari, wakati ukufaao na wakati usiokufaa, karipia, kemea, na kuonya kwa uvumilivu wote na mafundisho.
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Balaa! Huyu mtu wa kanisa ananiambi nihubiri neno na kuwa mvumilivu....
 
CC: Iconoclastes MK254

Sheria yenu hiyo hapo ipo wazi, Tanzania hatufanyi mambo bila kufikiri.
 
Scarlet Pimpernel said:
Just researched and found out that Kenyans have the same rule....SMH. A third for Insurance companies and 60% for insurance brokers should be local
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sasa kama pia Kenya sheria inasema wakenya wamiliki asilimia 60 basi watulie tu...by the way hizi kampuni ni very proftable hizo faida zote kuchukuliwa na wageni sio sawa...wamevana miaka yote hii hata wasilalamike maana tutakwenda sawa tu..
 
Boy sidung!
The world does not revolve around Kenya. We have so many foreigners huku, Chinese, Indians, Zambians, Ugandans, South Africans, Rwandese, Malawians, Wakongo ndo usiseme.
When we say foreigners we mean foreigners. Tatizo nyinyi mnapendaga kujiweka kwenye spotlight. You're all a bunch of attention seekers!
 
And how is the share holding structure in Kenya?

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Captain Marvelous said:
sasa kama pia Kenya sheria inasema wakenya wamiliki asilimia 60 basi watulie tu...by the way hizi kampuni ni very proftable hizo faida zote kuchukuliwa na wageni sio sawa...wamevana miaka yote hii hata wasilalamike maana tutakwenda sawa tu..
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Isitoshe wakati GoK is trying to force out KLM from ownership of the company they helped to groom, it is suicidal for Tanzania to do away their monopolistic tendency in Tanzania that is anti free market principles! The next thing should be a ceiling/cap on airline ownership in Tanzania 15% should be the maximum level a foreign company can own!

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i suggest in all the sectors the locals should be intitled to ownership...somebody told me Ethiopian GOvt have certain sectors which foreign companies cant invest at 100% and if they invest wanabaki kwenye kuzalisha tu wauzaji wanakua ni wa Ethiopia wenyewe no wonder their economy is growing at a higher rate compared to other Eastern African countries. Hili la Bima limekuja wakati mwafaka with the premiums we pay to thier diverse services its only fair iwe a win win situation..
 
As a matter of fact those companies are owned by foreign companies incorporated in Kenya look at Alliance, Reliance and Strategis share structure.

Back to the topic, ironically it is a hypocrisy of highest order for Kenyans in here to lament on current restructuring in Tanzania. Tanzania just like Kenya is instituting reforms that meant to boost revenues the GoT gets plus economic empowerment for her people.

Contary to EA common market principles Kenya has been doing and is doing the same staff though at regional is a protectionism since Kenya is a signatory of economic block protocol. Of recently a reference can be sighted from the Bakhresa lock out of Kenyan market from grain business entrance and recent Lakeoil lock out from gas exports to Kenya.

As Kenyans you ought not to complain or point an accusing finger but get a piece of bitter dose from Magufuli. And tell Uhuru is about to pack out of that house coming 08/08 as he has lived beyond his usefulness at that Harambee house.

Business

KQ moves to end ‘abusive’ union with Dutch Airlines, KLM

By Dominic Omondi and Macharia Kamau | Saturday, Jul 22nd 2017 at 21:17

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[https://www]Kenya Airways Kenya Airways CEO and Managing Director Mbuvi Ngunze flanked by Board Chairman Michael Joseph during investor briefing for the company's full year performance for the period 1st April 2016 to 31st March 2017.The company recorded an Operating Profit of Kshs 900Million compared to a loss of Kshs 4.1Billion last year, driven by a strong recovery strategy, Operation Pride.PHOTO DAVID NJAAGA/STANDARD}

The ‘abusive’ marriage between Kenya Airways and Netherlands’ Royal Dutch Airlines (KLM) might be headed for an uneventful divorce.

KLM has already, at least in principle, agreed to this fate. But it must have been a bitter pill to swallow for the Dutch Airline which had such unfettered control over the national carrier.

A new financial restructuring plan by the cash-strapped airline proposes to scrap a 22-year old agreement that thrust KLM into the heart of the national carrier’s ownership and management. The agreement turned major shareholders such as the Government of Kenya into mere pawns in the European’s airline grand plan of ruling the skies.

The Dutch airline which has since 1995 been calling the shots at Pride Centre through an agreement that the Government naively signed with it to save troubled KQ, will now have to shed close to half of its 26.73 per cent shareholding.

KLM will have to contend with a 13.71 stake in KQ in a new ownership structure that will see the Government increase its shareholding from 29.8 per cent to 46.53 per cent, even as KQ gets new owners in the form of 11 banks that the Nairobi Securities Exchange-listed company owed about Sh22.5 billion.

ALSO READ: No special treatment for Banks acquiring shares in Kenya Airways

The Government and the 11 banks will convert their debt into equity through a complicated debt restructuring plan which is aimed at stopping hemorrhage in the airline, even as KQ aims to cruise into the calm skies of profitability. The airline, which made a record Sh26.2 billion after-tax loss in full year ending March 2016, seemed to turn a corner in the next year when it reduced the loss to Sh10 billion.

The termination of the skewed agreement, according to a circular to shareholders signed by the airline’s chairman Michael Joseph, marks the beginning of what they believe will “further enhance the benefits to the company.”

For a company that enjoyed privileges such as the appointment of directors, sale of aircraft, route network and a say in allotment and issue of any shares in the capital of KQ, this development will certainly leave KLM so impotent that it will have almost no incentive to stay in the marriage.

KLM’s absolute authority extended to all the aspects of the company, including approving the sale of any shares held by the Government. Indeed, under the current arrangement, an objection by a single KLM director is enough to overturn a resolution passed by the 12-member board.

Michael Joseph, the former CEO of telecommunications firm Safaricom, in an interview with Weekend Business alluded to the end of KLM’s reign at Kenya Airways.

He noted that while KLM will continue participating in decision-making at KQ, the Dutch airline will not wield as much power as it did in the past. “KLM will not appoint anyone to the management but as part of their enhanced in-kind contribution we will ask them for more technical and management support which might include some temporary skilled people,” Joseph said. “KLM will retain one seat on the Board as long as their equity does not fall below five per cent.”

He said the parties will amend the venture agreement. “We will look to revise the joint venture agreement for the mutual benefit of both parties,” he said.

ALSO READ: Taxpayers’ exposure to guaranteed debts

Joseph said a new agreement would be for the benefit of both KQ and KLM. The old agreement signed between the two airlines in 1995 prior the finalisation of the deal in 1996 will be terminated.

In the circular, KQ board said that the “long-standing joint venture agreement” between the two airlines would “further enhance the benefits to the company.”

“In addition, KLM and KQ will be amending their long-standing joint venture agreement to further enhance the benefits to the company. Under the proposed cooperation agreement, the shareholders agreement entered into between the Government and KLM at the time of KLM’s initial investment in the company in 1995 will be terminated,” said the airline in a circular signed by the board’s chairman.

KLM’s fate is expected to be sealed during an Extraordinary General Meeting (EGM) to be held on August 7. KLM will be left with a 13.71 per cent stake.


However, should the resolution pass, other minority shareholders will also be diluted by 95 per cent- a situation that Kenya Airways sees as a necessary sacrifice by a few for the bigger good of the airline. Diluted investors will, however, be offered an opportunity to re-invest into the company.

A group of 11 banks, under a special vehicle known as KQ Lenders Company Limited, will edge out KLM from the second position by raking up 35.69 per cent shareholding following a debt restructuring scheme that saw the lenders and Government convert their debts into equity.

On January 11, 1996, Kenya Airways and the Royal Dutch Airlines (KLM) finalised a deal where KLM acquired a 26 per cent stake in the Kenyan carrier for $26 million (Sh2.69 billion at the current exchange rate).

ALSO READ: Kenya Airways ownership changes in revival plan

This was the culmination of the plan to privatise the airline that had started way back in 1986, with the publication of the Sessional Paper No 1 of 1986 ‘Economic Management for Renewed Growth, which talked of Government divesting from state corporations. The plan gathered momentum in 1992, when the airline’s board was given the mandate to privatise it.

Royal Dutch KLM was picked to steer KQ’s revival in a contest where British Airways and South African Airways were reported to have also bid. Other than the 26 per cent stake sold to KLM, the Government sold another 51 per cent to investors through an Initial Public Offering in March of 1996 and retained a 23 per cent shareholding, but has over time clawed some stake to stand at 29 per cent.

The agreement signed on January 11, 1996 by Rob Abrahamsen the then managing director and chief financial officer KLM and Brian Davies the then managing director at Kenya Airways may be termed as poison pill due to clauses that gave immense power to the Dutch airline.

Though the two airlines had officially gotten into what was termed as a joint venture, KLM had an upper hand in making decisions on a wide range of issues that included appointment of directors, sale of aircraft, determining KQ’s route network and the allotment and issue of any shares in the capital of the company.

Thus, KLM has over the years made the strategic decisions while its directors sitting on KQ’s board could veto decisions even in instances where the other directors were unanimous.

KEEP THE AIRLINE AFLOAT

Joseph said the agreement that gave the Dutch airline all the power would be revised. The revision of the agreement is likely to give the Government – which will now own close to 50 per cent stake – an upper hand in the running of Kenya Airways. This will set the airline back some 20 or so years when through the 1996 deal, it was handed over to the private sector while the Government took a backseat.

While it will not have the control it has had over time, KLM will remain critical in the restructured KQ, according to the circular issued by the board to shareholders last week which details a raft of measures that shareholders will undertake to keep the airline afloat.

ALSO READ: Kenya Airways ownership changes under debt restructuring plan

“Both KLM and the Government will remain key strategic shareholders in the Company going forward via a combination of converting loans (in the case of Government) into equity and through the investment of new capital (in the form of in-kind contributions) in return for the issue and allotment of Ordinary Shares,” said the circular.

Among the roles that KLM will play in the restructured KQ include the injection of new capital and in-kind contribution, all of which add up to Sh7.9 billion. According to the document, KLM will subscribe for additional new ordinary shares in KQ through the $26.5 million (Sh2.7 billion) of in-kind contributions.

The in-kind contributions will include offering KQ the London Heathrow slots (which KQ has been leasing from KLM) as well as offering KQ IT systems and support.

KLM will also inject Sh2.5 billion through a subscription to ordinary shares in KQ and a further Sh2.5 billion of in-kind contributions following the completion of the restructuring.

KQ moves to end ‘abusive’ union with Dutch Airlines, KLM


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You are so deluded that you cannot see the difference? equally held by Citizens of the Partner States of the East African Community? Does it mention Kenya?
 
Amended insurance law in Tanzania

THURSDAY JULY 27 2017



Tanzania's National Insurance Corporation (T) Limited. PHOTO FILE | NMG

In Summary

The Miscellaneous Amendments Bill (No. 2 of 2017), which has been passed by parliament, amends the Insurance Act (No. 10 of 2009)Requires customers to pay insurers all premiums directly, even where they are using brokers.The amendments give the Commissioner of Insurance powers to set minimum rates of premiums payable for different classes of insurance, by publishing the orders in the Government Gazette.

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By CHRISTABEL LIGAMI
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Tanzania has amended its insurance law to give two-thirds ownership of brokerage firms to locals.

The Miscellaneous Amendments Bill (No. 2 of 2017), which has been passed by parliament, amends the Insurance Act (No. 10 of 2009).

The changes require insurance brokers to be at least two-thirds (above 66 per cent) owned and controlled by Tanzanian citizens — a 100 per cent increase from the previous local-participation requirement of one-third or 33 per cent).

Further, it requires customers to pay insurers all premiums directly, even where they are using brokers.

Brokers will only be entitled to receive their commissions directly from the insurers (instead of taking them out of premiums from customers), with heavy penalties for contravention.

Minimum rates
The amendments give the Commissioner of Insurance powers to set minimum rates of premiums payable for different classes of insurance, by publishing the orders in the Government Gazette.

Insurance cover for a Tanzanian resident individual or company may only be placed with a Tanzanian registered insurer.

The changes make clear that all ground transport, marine and air cargo insurance covers for Tanzanian imports must be effected by a Tanzanian insurer.
The government has passed the Fair Competition (threshold for Notification of a Merger)) Order, 2017, amending the Fair Competition (threshold for Notification of a Merger).

Order, 2006, which sets out the thresholds for a merger that are notifiable to the Fair Competition Commission as well as the mechanics of calculation of that threshold.

Amended insurance law in Tanzania

With gas n mining n industries economy on stream, it is time to take back this sector from nyang'aus influence.

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Poise said:
I said it, and soon we are going to finalize with KCB bank and Kenya Airways.

Till you respect us.
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Hakuna shida. Eventually it will be your loss.
Burn bridges with the largest economy in the region and you'll end up courting Malawi to sell you goods.
Ask Mexico how Trump is treating them.
In the meantime we are opening new markets for ourselves. Like a peaceful Somalia and South Sudan.
Our banks already control South Sudan.
 

And how much do those Rwandese and Malawians own in Tanzania.
Out of 10 foreign investors in Tanzania, probably 7 are Kenyans. All other countries share the rest.
Unless you have a head the size of a peanut, you can see clearly who the target is.

It's the same thing if Kenya were to decide today that we have banned all gas imports from all countries.
There's only one target there.
 

You think so though, the truth is different!

If you vote for Uhuru Kenyatta you're all dead bodies or badly injured.
Because, Uhuru, will support Trump's view and continue with more fights against Somalia, then somalians will slaughter all of you.

On the same time, we will shut down all KCB bank and Kenya airways activities in Tanzania.

Let me remind you this, only Tanzania can help you during any political instability but for this time you gonna die all of you if you fight during election chaos we will not making any help to you.

Till you respect us.
 

1. Kenya does not have stand alone soldiers in Somalia. We are fighting in Amison alongside other African countries. I doubt Tanzania contributed.
2. Al Shabaab are throwing their last kicks. I can't even recall the last time they executed a successful attack in interior Kenya. Only at the borders. We need more soldiers there urgently to finish the job.
3. We all know Magufuli is a mad dictator, but I doubt he would wake up and shut down KCB and KQ. If he did, your journey to become another Zimbabwe will have accelerated.
4. Respect is earned. The day you stop eating albinos will be the first step towards the world seeing Tanzania as not just another of those poor countries looking for aid.
 


Kenya too bows down to aids, loans and financial providers from abroad and in the same time, moves around with a side-plate beggings for help.

Last few weeks, Trump smashed some aid for Kenya, we heard cries throughout by Kenyans around the globe starving for that shut down of aid from USA.

Any way, Kenya has nothing great than, Tanzania as I know most of the projects undergoing in Kenya are owned by foreigners.
That's why you have good GDP with poor GNP.
 

Big difference between aid and loans. The former is LDC's specialty.

Unlike Tanzania, North Korea and Zimbabwe, we have an open market. Foreigners are free to come and invest without necessarily pleasing our president (who is not a dictator).
Most big private projects in Kenya are owned by Kenyans and funded through loans by Kenyan banks. Even the ones with foreign owners, there are Kenyans involved and often a Kenyan bank does the financing.
 


You're arguments are illusions and assumption.
 
Only 8 brokers in Tanzania have foreign sharering.
Those few they will have to sell or 1/3 or leave
And it is not kenya only brokers who will be affected it all foreign owned.
 
ina maana sisi Watanzania tumeshindwa anzisha kampuni kubwa ya bima itayoweza shindana na za wakenya
 
We will be screwing you to the maximum mpaka tuheshimiane.
 
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