Why Franchise Dealers and Used-Car Importers Don't Play by the Same Rules

Why can a brand-new Toyota Prado or Mercedes-Benz sit in a CMC Motors or CFAO Mobility showroom without Kenyan number plates, while an imported used vehicle must now be registered before it is sold?

• That question sat at the centre of a closely watched High Court battle between Kenya's used-car dealers and the National Transport and Safety Authority (NTSA).
• The Car Importers Association of Kenya (CIAK) argued that franchise dealers were allowed to keep new vehicles unregistered until sale, while importers of used cars were being compelled to register vehicles immediately after customs clearance.
• Because the two categories of dealers operate under different legal and customs frameworks, Justice Jairus Ngaah ruled that they are not similarly situated and one cannot claim discrimination.

The dispute began after NTSA published a notice in December 2024 directing all motor vehicle dealers to complete pending registrations within seven days.

The regulator warned that vehicles found operating without registration plates, or improperly using Kenya Dealer (KD) plates, would be impounded, while dealers risked prosecution for failing to comply with the Traffic Act.

Alarmed, CIAK met NTSA officials in Mombasa and later wrote to the authority requesting a three-month compliance period, arguing that the deadline was impossible to meet because of weekends, a public holiday and the sheer number of vehicles awaiting registration.

The association also proposed an alternative release fee to regularise existing stock but told the court that NTSA never formally responded before moving to enforce the directive.

The Number Plate Premium

Dealers argued that immediate registration erodes the value of imported vehicles because many buyers judge a car's age from its Kenyan registration series rather than its actual year of manufacture, mileage or condition.