Month: December 2025

The African Continental Free Trade Area Agreement (the AfCFTA) is a framework that aims to facilitate African industrialisation and development by shifting the continent’s global trade patterns. It represents a landmark effort to redefine Africa’s trade landscape by creating a unified market for goods and services across the continent. It came into force on 30th May 2019, after the required a number of ratifications were deposited with the African Union (AU) Commission. It currently has fifty four (54) signatories, boasting the largest free trade area globally by membership.

The AfCFTA was introduced to foster a symbiotic relationship among African countries, with the overarching goal of reducing barriers to trade. It endeavours to boost intra-African trade by addressing non-tariff barriers to trade and progressively reducing tariffs. However, in an era increasingly driven by digital commerce, the success of this ambition depends not only on the flow of goods and services but also on the free and secure movement of data.

Data Protection and Cross Border Trade

As trade becomes increasingly digital, cross-border data flows and harmonised data protection frameworks become essential for e-commerce to function securely and seamlessly across jurisdictions. The United Nations Economic Commission for Africa recognised the AfCFTA as the world’s largest free trade area since the formation of the World Trade Organization (WTO). Additionally, in 2016, the United Nations Conference on Trade and Development (UNCTAD) affirmed that data protection is critical to digital trade, citing that poor data governance diminishes customer trust and distorts market dynamics.

However, it is important to recognize that no country is willing to grant another unfettered or unregulated access to its data. Increasingly, data governance has become a source of tension and dispute among sovereign states. While the AfCFTA has enabled the free flow of services and information across borders, critical questions remain as to the safeguards in place to protect that information. For member states to fully harness the benefits of the digital economy in international trade, they must acknowledge that data is a strategic asset and establish robust and effective data protection regimes.

As such, there is a need for continental or regional data protection harmonisation to secure digital trade. By focusing on streamlining trade, including services, investment, intellectual property and digital trade, the AfCFTA aims to facilitate free movement of persons, goods and services crucial for deepening economic integration. This free movement is largely fuelled by data and the cross-border movement of the same. Data protection therefore becomes a key concern.

The Heads of State and Government of the AU in their decisions (Assembly/AU/4(XXXIII) of 10th February 2020 and Ext/Assembly/AU/Decl.1(XII) of 5th January 2021) mandated negotiations for the Protocol, emphasising the importance of safeguarding national data integrity and security. This directive aligns with the broader objective of upholding citizens’ rights to retain control of their personal data. Against this backdrop, the 37th AU Heads of States Summit held in February 2024, adopted the much-anticipated Protocol to the Agreement Establishing the AfCFTA on Digital Trade (the Protocol). The Protocol seeks to facilitate cross-border data flows while addressing privacy concerns and will come into force once the required number of ratifications is deposited in accordance with Article 23 of the AfCFTA. Part IV of the Protocol on data governance encompasses cross-border data transfers, protection of personal data, location of computing facilities (data localisation), and data innovation.

Additionally, under Article 20 of the Protocol, on cross-border data transfers, parties to the Protocol, subject to the relevant Annex, can only allow cross-border transfer of data, including personal data by electronic means, provided the activity is for the conduct of digital trade by a person of a state party. The exception to this is where a state party intends to achieve a legitimate public policy objective or protect essential security interests provided that the measures are not applied in a manner which would constitute a means of arbitrary or unjustifiable discrimination, or a disguised restriction on digital trade, and do not impose restrictions on transfers of data greater than are necessary to achieve the objective.

Article 21 also requires state parties to adopt legal frameworks at the national level providing for the protection of personal data of natural persons engaged in digital trade. Article 46 further provides that after the adoption of the Protocol, state parties shall adopt annexes including the Annex on Cross-Border Data Transfers. On 16th February 2025, the Assembly of Heads of State and Government of the AU formally adopted eight (8) annexes to the Protocol including the Annex on Cross-Border Data Transfers, which sets out regulations aimed at facilitating secure and efficient data flows across member states.

Advancing Data Governance

McKinsey, in its report on Africa business growth noted that Africa has over 400 million internet users, with the implication that e-commerce is largely propelled on the continent. One of the projected outcomes of the growth of intra-African trade spurred by the AfCFTA is increased data transfers across member countries.

Data protection harmonisation across member states can propel AfCFTA forward, in turn building consumer and business trust as well as fostering the digital economy. Following the integration of digital technology in trade, the African Heads of State recognized the need to provide data protection and privacy for the parties involved. This move was especially motivated by the fact that while the AfCFTA aimed to facilitate seamless trade across the continent and the free flow of goods, services and information, it failed to address questions as to how the data involved is protected.

Furthermore, the regulatory fragmentation across member states was a major concern, as some member states to the AfCFTA lack data protection laws at the national level to help govern and control how data flows, its security and usage in the region. This left data exchanged across jurisdictions open to misuse, hacks and threats. These issues underscored the imperative for the AfCFTA to include robust data protection measures, either within its core framework or through an annexure, to ensure its effective implementation.

It is important to recognise that no country is willing to grant another unfenered or unregulated access to its data. Increasingly, data governance has become a source of tension and dispute among sovereign states. While the AfCFTA has enabled the free flow of services and information across borders, critical questions remain as to the safeguards in place to protect that information.

In light of the above, the recent adoption of the Annex on Cross-Border Data Transfers within the Protocol marked a transformative step in aligning Africa’s digital economy with modern data governance standards. Recognising the essential role of cross-border data flows in intra-African trade, this development demonstrates the visionary leadership of the AU Heads of State in enabling secure, seamless, and trusted data exchanges across the continent.This Annex not only complements the AfCFTA’s mission of boosting intra-African trade but also provides a regulatory framework to safeguard personal data and digital trust in the e-commerce ecosystem, in turn standardising cross-border data transfer conditions among member states. It provides for exceptions grounded in legitimate public policy objectives and essential security interests. The Protocol mandates the inclusion of provisions in the Annex addressing acceptable use of data, restrictions on third-party sharing, and applicable regulatory limitations, including data protection safeguards. The Annex now introduces a harmonised set of rules that serve as a common baseline, particularly benefiting jurisdictions that are yet to enact domestic data protection laws, as the Protocol emphasises for member states to establish regulatory frameworks that focus on improving trust in digital transactions.

Recommendations

While the adoption of the Cross-Border Data Transfers Annex is a significant milestone, the effectiveness of its implementation will hinge on a few strategic actions:

i. Benchmarking with European Legal Architecture

The European Free Trade Agreement (EFTA) provides a robust precedent on integrating data protection frameworks within trade agreements. Annexure XI of the EFTA outlines regulatory approaches to data protection in areas such as electronic communications and information services. The Protocol and its Annexes can draw insights from this model, and borrow useful provisions.

ii. Standardising Cross-border Data Transfer Conditions

The Annex must prescribe detailed safeguards that promote accountability and risk management in data flows. These safeguards include providing proof of availability and effectiveness of appropriate safeguards with respect to security and protection of personal data subject to the transfer. Additionally, data transfers must be grounded on lawful bases such as consent, contractual performance, data subject’s benefit and public interest, among others.

Key Take Away

Data is the backbone of Africa’s evolving digital economy. The adoption of the Cross-Border Data Transfers Annex under the Protocol is more than a regulatory milestone, it is a bold affirmation of Africa’s readiness to lead in the digital trade era. By laying down clear, harmonised standards for data governance, the Agreement addresses one of the most critical enablers of modern commerce: trust.

As implementation unfolds, this Annex could become the backbone of a secure and thriving continental digital market, eventually evolving into a blueprint for global south-led data governance models.

“Indeed, the title or lease is an end product of a process. If the process that was followed prior to issuance of the title did not comply with the law, then such a title cannot be held as indefeasible. The first allocation having been irregularly obtained, HE Daniel Arap Moi had no valid legal interest which he could pass.” This finding was affirmed by the Supreme Court in the instant case, being Sehmi & another v Tarabana Company Limited & 5 others [2025] KESC 21 (KLR) (the Tarabana Case) having been borrowed from the Supreme Court’s earlier decision in Dina Management Limited vs. County Government of Mombasa & 5 Others [2023] KESC 30 (KLR) (the Dina Management Case).

The observations of the Supreme Court gave authoritative clarity on the doctrine of an innocent purchaser for value without notice. In doing so, the Supreme Court conclusively resolved any lingering uncertainty surrounding the application of the doctrine which has frequently been used as a defense by unscrupulous land grabbers who are intent on circumventing the provisions of Article 40 of the Constitution of Kenya, 2010.

It is now settled that no valid title can pass and no legal estate is acquired if the process leading up to the said acquisition is marred with procedural illegalities. The defence of an innocent purchaser for value without notice thus falls by the wayside.

Exploring the Limits and Applicability of the Innocent Purchaser Doctrine

In the Tarabana Case, the Supreme Court undertook a comprehensive analysis of the legal doctrine of the bonafide/innocent purchaser for value without notice. The Court was invited to consider whether, and under what circumstances, a purchaser may be deemed to have acquired a valid and indefeasible interest in land notwithstanding underlying irregularities or illegality in the allocation process.

In its determination, the Supreme Court laid out the test made up of three (3) ingredients that a person claiming to be a bonafide purchaser must meet. These ingredients entail the following:-

i. Element of Innocence

This means that the purchaser must act in good faith. His conduct must not raise any doubt as to whether indeed, he did not have any notice or knowledge as to the existence of a rival interest in the suit land. The element of innocence also connotes the exercise of due diligence expected of any reasonable purchaser. The claimant must demonstrate that he acted diligently and conducted a reasonable inquiry into the status of the estate or land that he sought to purchase.

ii. Purchase for Value

This means that consideration in money or money’s worth was paid by the claimant in return for the land. The purchaser must actually pay all the money due before receiving notice of the existence of the equitable interest over the suit land. Mere execution of the instrument of conveyance of the legal estate before notice is received without payment of the money due, will not avail to the claimant the defence of innocent purchaser.

iii.  Legal Estate

An innocent purchaser of a legal estate in land without notice of an equitable interest in the said land, takes it free from the encumbrance of the latter interest. This is because legal rights are good against all the world; equitable rights are good against all persons except a bonafide purchaser of a legal estate for value without notice.

Having outlined the ingredients that must be met, the Supreme Court then proceeded to interrogate whether these ingredients were met in the Tarabana Case as detailed below.Analysis of Legitimacy

The Supreme Court was confronted with a dispute involving two (2) sides, the Appellants on the one hand, and the 1st and 2nd Respondents on the other. Each of these sites claimed to be holding title to the suit property they deemed legitimate. At the centre of the matter was the question of competing claims to land ownership, where legality and equity seemed to be at odds.

In finding that the Appellants neither had a legal nor equitable interest in the suit property, the Supreme Court found as follows:
“By the time the suit land was allocated to the 2nd Respondent, the Appellants’ lease had long expired. We are therefore in agreement with the Court of Appeal’s conclusion that the lease having expired, the land had reverted to the Government. It was no longer a leasehold estate, but government land within the meaning of the Government Lands Act (now repealed). Where did this cruel reality leave the Appellants? What rights, if any did the Appellants have over the suit land? It was submitted without contestation at the trial court, that after the expiry of the lease, the Appellants continued in possession of the land, while paying the applicable land rates and rent. What then was the legal status of the appellants with regard to the land? Can the appellants be considered as having acquired an equitable interest in the land by virtue of their continued stay upon the same? We think not, since through effluxion of time, and reversion to the Government, the lease had become extinguished for all purposes. No equitable interest over the land could survive such extinction. Whatever remained in favour of the appellants over the land, could at worst be regarded as “a tenancy at will” or at best “a mere equity”.

The Supreme Court then proceeded to address the illegality of the 1st and 2nd Respondents’ title as below:

“ … it is our finding that the allotment of the suit land to the 2nd Respondent can neither be regarded as legal nor regular. The allocation was made by a person other than the holder of the office of Commissioner of Lands. Neither was the allotment preceded by the requisite advertisements and biddings assuming that it was being allotted for a public purpose. Consequently, the 2nd Respondent could not pass valid title to the 1st Respondent given the incurable procedural irregularities that had characterized the allotment.”

Consequently, the Supreme Court proceeded to nullify the allotment of the suit property to the 2nd Respondent, and found that the 1st Respondent was not a bonafide purchaser of the suit property without notice on account of failing to meet the three (3) ingredients as follows:

• The element of innocence: The allotment to the 1st Respondent was unprocedural as it was not done by the Commissioner of Lands. The allotment was also not preceded by the requisite advertisements and biddings. There was nothing on record to show how, and for what purpose the suit land came to be allocated to the 2nd Respondent who promptly sold it to the 1st Respondent.
• Purchase for value: No explanation was given for the discrepancy in the purchase price which was KES 12.5 Million in the transfer documents despite the sale agreement indicating KES 24 Million. This was interpreted as a deliberate attempt to evade paying the higher stamp duty applicable to the transfer.
• A legal estate: The 2nd Respondent was incapable of passing a valid title to the 1st Respondent as it had acquired the same un-procedurally.

The Appellants’ Saving Grace – Legitimate Expectation

It was on record that three (3) months before the expiry of the lease, the Appellants had made an application for its extension. The Commissioner of Lands, the Director of Physical Planning, and the Director of Survey all acknowledged receipt of the application for extension of lease by the Appellants and indicated that there were no objections to the renewal. This was never communicated to the Appellants. However, inexplicably, the application for extension of lease remained pending and unacted upon for eight (8) years, when the suit land was allocated to the 2nd Respondent. The Supreme Court observed that the application for renewal gave rise to the legitimate expectation for the renewal of the Appellants’ lease and stated thus:

“More often than not, public leases contain an option for renewal. However, such renewal must be activated by an application by the lessee to the government agency having authority to renew the lease. It follows therefore that where the lessee makes an application for renewal of his/ her lease, his/her application would be considered either way and that, the applicant would be furnished with reasons should the application be declined. It would also be expected that the application would be clear and unambiguous. It is the application for renewal that ignites the legitimate expectation, given the fact that it is addressed to an authority that has the competence to renew the lease.”

The Supreme Court found it logical to conclude that the Appellants had a legitimate expectation that their lease would be extended. Such an expectation was not only reasonable, but was expressed to a competent authority, who at different times, had exercised the powers conferred upon him by the law, to extend the leases of other applicants in a similar position as the appellants. To this end, it was the Supreme Court’s final order that the Appellants were entitled to an extension of lease over the suit property.

Disposition

The clarity provided by this decision settles an issue that has been bedeviling the question of acquisition of titles in Kenya and it is now hoped that moving forward, alleged ‘innocent purchasers’ have been put on notice that their alleged innocence may not meet the requisite legal threshold for granting them titles to land. In essence, the Supreme Court has emphatically underscored the need for absolute propriety and regularity in every step of the process leading up to the acquisition of land, signifying a clear position that Courts will henceforth not shy away from striking down as illegitimate any tittle acquired through a flawed process.