Implication of the Scrap Metal Rules, 2022

On 26^th April 2022, the Ministry of Industrialization, Trade and Enterprise Development gave an update on the moratorium on trade in scrap metal which was announced by the President on 20^th January 2022.

The Moratorium applied to the dealing, buying and selling of scrap metal and was necessitated by the increased vandalism of critical infrastructure including transformers, transmission lines, rail and road infrastructure. Additionally, the President had directed the development of Regulations to guide the Trade in scrap metals, which the Ministry in its update, noted that the same had been done.

The key highlights of the Scrap Metal Rules, 2022 are:

1. The Rules apply to collectors, agents, dealers, millers, smelters, transporters, steel fabricators, stockists of second-hand metal parts, motor vehicle salvage operators, electrical re- winders, local welding machines fabricators.
2. All persons dealing with Scrap Metal must apply for license.

• Any person who undertakes scrap metal trade without a license commits an offence which attracts a penalty of a fine not exceeding ten (10) million shillings or an imprisonment not exceeding three (3) years or both for a first offence and for a second offence, a fine not exceeding twenty (20) million shillings or an imprisonment not exceeding five (5) years or both.

1. All Applications for a License will be vetted by a multi-Agency Team.
2. All Recipients of Scrap Metal must maintain records of Supplies and Suppliers after Verification of identity.
3. Membership of a Scrap metal dealers association; licensed dealers should be registered members of a business member organizations which shall establish self-regulating mechanisms to prevent and regulate trade in scrap metal from vandalized public infrastructure and utilities and stolen private property.

• Scrap metal dealers are required to pay the requisite fees according to the rules.

In light of the development of the rules, the President permitted the gradual lifting of moratorium with effect from 1^st of May 2022.