For nearly a decade, the dispute between East African Breweries Plc (EABL), its subsidiary Kenya Breweries Limited (KBL), and Bia Tosha Distributors Limited has been framed in public discourse as a case of a local distributor losing control of valuable territory to a multinational brewer.
However, a closer reading of court filings, agreements and supporting documents now before the High Court suggests that the legal foundation of that narrative may be far less certain than widely assumed.
At the centre of the dispute are payments made by Bia Tosha in 2005 and 2006, which the distributor has consistently argued were made in exchange for long term territorial rights. These payments have been described in the case as “goodwill” tied to what has been referred to as the “Bia Tosha Territory.”
Yet the documentary record cited by KBL and EABL presents a different interpretation. The 2005 tender notices were framed as procurement processes inviting distributors to participate in a network rather than instruments of sale. Subsequent documentation, including a 2006 agreement, characterised the payments as non refundable commitment fees linked to market development and operational readiness.
The distinction is central to the dispute. While a purchase would imply transfer of a proprietary interest, a commitment fee is typically associated with participation in a commercial arrangement that remains subject to contractual terms.
Equally significant is the issue of exclusivity. Court filings indicate that the distributorship agreements were expressly non exclusive, allowing KBL to appoint multiple distributors within the same geographical areas. This raises questions about the extent to which any single distributor could claim enduring control over defined routes.
The legal trajectory of the case shifted in June 2016 when Bia Tosha filed a constitutional petition alleging violation of property rights under Article 40. This reframing moved the dispute out of a conventional commercial context and into constitutional litigation, where interim orders and procedural questions have since dominated.
A conservatory order issued in 2016, preserving the distribution structure as it existed in early 2006, has remained a focal point of the proceedings. The order was set aside by the Court of Appeal in 2020, reinstated by the Supreme Court in 2023, and has since been subject to further clarification and contestation.
Despite these developments, the High Court has yet to determine key issues, including whether the payments created any property interest, whether the distributorship arrangements were exclusive, and whether any damages are payable.
The case therefore remains unresolved on its merits. What is clear from the record, however, is that the underlying agreements may not support the straightforward ownership narrative that has shaped public perception.
