High Court orders relief in Zanzibar beer shortage case

Unguja. A glimmer of hope emerged for importers and consumers alike in the ongoing Zanzibar beer shortage, as the High Court ruled in favor of three companies previously denied licenses by the Zanzibar Liquor Control Board (ZLCB).

On February 19, the court granted an injunction requested by Zanzibar Maritime and Mercantile International Co. Ltd, One Stop Company Limited, and Scotch Store Limited, restraining the ZLCB from interfering with their operations, suspending their permits, or delaying their goods. 

“That the honorable honourable Court  be pleased to  order the second respondent (ZLCB), its principal principal, 'Officer/Chairman', and/or any  other responsible officer, to issue appropriate Import/distribution/sales licenses to the applicants, pending hearing and final determination of this matter, including the pending appeal to the Minister and related judicial review proceedings,” ordered Judge Rabia Hussein Mohammed.

The judge further ordered that the applicants be allowed to continue dealing with the importation, purchase, supply, distribution, transportation, and sale of alcoholic beverages (subject to payment of relevant taxes) pending a hearing and a final determination of the related judicial review proceedings. 

Earlier this year, the ZLCB's decision not to renew the licenses of the three established importers, who had served the islands for over two decades, triggered a significant beer shortage in Zanzibar. 

Prices skyrocketed, with some brands hitting as high as 300 percent. Tourism businesses expressed concern, and legal action was initiated.

While the full details of the court's reasoning are not yet available, the granting of the injunction suggests that the judges found merit in the applicants' arguments. It remains to be seen whether the ZLCB will appeal this decision.

This court ruling will alleviate the beer shortage in Zanzibar and bring relief to both businesses and consumers. 

However, the situation remains fluid, as the ZLCB could choose to pursue further legal avenues or seek a political solution. The longer-term implications for the liquor industry in Zanzibar are yet to be determined.

Businessmen say the root of the problem lay with the Zanzibar Liquor Control Board after they delayed permits for the three established importers—One Stop, Scotch Store, and ZMMI—which sparked the initial hiccups. 

But a more drastic decision followed on January 2 when the board refused to renew licenses for these seasoned players, who had served the islands for over two decades.

The newcomers who were granted licenses, plus the temporary measures that were instituted, have yet to bear fruit despite the recent assurances during a meeting with the Zanzibar Revenue Authority, and the island continues to depend on supplies by the military and what others suspect to be smuggled alcohol. 

Observers feared that it would prolong the agony, potentially taking up to six months, as the prices spiralled beyond reach. 

The first official alarm bell was rung by former Minister of Tourism and Heritage, Simai Mohammed Said. 

Meeting with tourism stakeholders last month before his resignation, he painted a stark picture of Zanzibar's dependence on tourism, a sector contributing over 30 percent of the island's GDP.

"We've seen the board's decision," he said, frustration in his voice. "Hotels face shortages, businesses struggle. I urge investors to remain patient while we seek solutions."

The Citizen's investigation reveals a lengthy vetting process for new importers, as they need to comply with manufacturers' code of conduct.

Importers pay a hefty Sh30 million annual fee to the board to be licenced and Zanzibar law also demands importers be Zanzibari residents with a clean tax record, a warehouse, and a delivery vehicle.