The Senate Committee on Trade, Industrialization and Tourism has today met with the Commissioner General, Kenya Revenue Authority, Mr Humphrey Wattanga, to deliberate on the Petition on the Alleged Fraudulent Dealings at Diageo PLC, East Africa Breweries Limited (EABL), Kenya Breweries and UDV (Kenya) Limited. 

This comes after Bomet Senator Wakili Sigei petitioned the Senate on behalf of the Petitioner, Mr Rono Nicholas, asking the Senate to investigate Diageo PLC’s alleged fraudulent 15% additional acquisition of shares in East African Breweries Limited. 

Mr Rono informed the Senator Lenku Seki-led Committee that an onward sale of Diageo interests in EABL has been agreed upon with Heineken/Castel Group and the purchase of the additional shares by Diageo is meant to assure Heineken/Castel Group of a controlling stake in EABL after the onward sale. 

“The sale of the Diageo Shares to Heineken/Castle Group has been prompted by the desire of Diageo to fraudulently evade huge tax liabilities that EABL has been hiding through massive bribery of KRA and National Treasury officials,” alleged the Petitioner. 

While appearing before the Senate Trade Committee at Parliament Buildings earlier today, Kenya Revenue Authority’s Commissioner General addressed the Senators’ concerns on whether there was any tax lost in the transaction. 

“The Petitioner alleged that Diageo bought an extra 15% shares in EABL. How much tax was lost and forfeited by KRA in that transaction?” enquired Senator Seki. 

“We, as a Committee, would want to know whether tax was paid in that transaction,” Senator Omtatah added. 

The Commissioner General informed the Senators that the Kenya Revenue Authority is not aware of any such transaction between East African Breweries Limited and Diageo PLC. 

“There are regulatory requirements for the two companies to report any change of ownership to the Nairobi Stock Exchange. Unless the transaction happened and it escaped our grasp, that transaction has not happened,” Mr Wattanga explained. 

He further explained that if such a transaction happened the Authority would have the information since EABL is listed in the Nairobi Stock Exchange while Diageo PLC is listed in the London Stock Exchange. 

The Trade Committee subsequently resolved to further investigate the issue and get to the bottom of the matter.