New Mobile Device Regulations in Kenya: A Burden or a Benefit?

The Communications Authority of Kenya has announced some fundamental regulatory changes regarding mobile devices that are set to take effect starting January 2025, yet as much as the aim is to boost tax compliance, these new measures could mean higher phone prices that will make smartphones more unaffordable to the average Kenyan.

What’s the New Regulation About?

Starting January 1, 2025, every mobile device in Kenya will be put into a national database. That means each phone will need to provide its IMEI number, working like its "passport." Phones not registered are forbidden from accessing Kenyan mobile networks.

It means all new mobile devices imported, assembled, or sold in Kenya starting November 1, 2024, shall be subject to this directive by the CA. Importers and local assemblers shall be required to register IMEI numbers with the Kenya Revenue Authority, while it allows retailers to sell only those tax-compliant gadgets. For these devices, the IMEI number shall be verified by the MNOs before allowing such devices to connect to their network.

While this might sound so easy, it just adds several layers of bureaucracy in particular to the importer, seller, and ultimately the consumer. Take a look below:

The Potential Impact on Consumers

To many Kenyans, the mobile phone is more than a simple tool for communication but a lifeline for daily living through M-Pesa transactions, education, business, entertainment, and more. Kenya has been at the forefront of mobile and digital innovations. These new regulations substantially threaten to slow those advances.

Of course, the first fear is the hike in the price of mobile phones. Importers and local assemblers of phones will have to take extra steps to ascertain that they have paid their dues. This means disclosure of IMEI numbers to KRA before selling them to retailers. The additional time and resources for compliance are likely to be passed on to the consumer in the form of higher prices.

This would further result in denting the dynamic market for secondhand phones in Kenya-a very important avenue for devices at affordable costs for many. Small traders and vendors may be incapable of complying with the new tax and compliance needs, further exacerbating difficulties in the access of budget-friendly phones by ordinary Kenyans.

Could These Regulations Hurt Kenya’s Digital Growth?

Kenya is at a tipping point in its digital development. The country has embraced digital inclusion, and smartphone adoption with mobile connectivity is leading in propelling economic growth. These new regulations, however, threaten to slow down this momentum.

Entry into the digital world could get costlier, with increased bureaucracy and levies on mobile devices. Lower-income households relying on cheap, imported devices-or buying phones from abroad-might find themselves encumbered by a more laborious and expensive process. Ensuring compliance for personal imports might set quite a barrier to entry where smartphones become more of a luxury than a necessity.

A Global Comparison

Kenya does not mark the first country to adopt an IMEI registration system, as Nigeria has something similar: a Device Identification Registration and Blocking System, meant to help in cases of phone theft and smuggling. However, all these were mainly concepts of consumer protection rather than compliance for tax collection. Other countries, such as South Africa and the United States, also monitor lost or stolen phones with their IMEI numbers, but they do not attach as much importance to tax collection as is attached to the Kenyan model.

Whereas the Kenya approach was meant to deal with tax evasion, critics view this as an aggressive approach. The heavy burden resultant from the consumers and resultant high phone prices may have a negative effect on digital inclusion.

Is There Any Upside?

On the other hand, the government argues that the new regulations would enhance consumer protection and quality control. Because only those devices that are tax-compliant would be sold in Kenya, the CA wishes to cut down the number of counterfeit or substandard devices in the market. This can, at least in theory, lead to a better mobile experience in the country. Besides clamping down on tax evasion, the government hopes to increase revenue that could potentially be reinvested into public services.

But my short answer to this: NO!

What the Kenyans are Expressing on Social Media

Source: Stanley Masinde on X

Source: Neli on X

Source: Mbarani on X

What’s Next?

This means that from November 2024, new imports and locally assembled devices will be held to the regulations, while full implementation of the new policy will take effect on January 1, 2025. The government has reassured Kenyans that existing phones registered before October 31, 2024, will not be affected, but the future over affordable devices remains uncertain.

While the government’s push for tax compliance is important, the new mobile device regulations from the CA could place an undue burden on ordinary Kenyans. Increased costs and reduced access to affordable devices may hurt the very people these rules are meant to protect, potentially slowing Kenya’s digital growth.

As Kenya prepares for this regulatory shift, consumers, small traders, and businesses should stay informed and make their voices heard. Engaging with consumer protection groups and local representatives could be crucial in shaping how these regulations are implemented and ensuring that Kenya’s digital revolution remains inclusive.