Justice Bahati Mwamuye of the Milimani High Court’s Constitutional and Human Rights Division lifted the blocking orders Friday morning, in proceedings that were upended almost immediately after they began when Senior Counsel Eric Theuri broke the news of Parliament’s overnight action to a court that had assembled to hear oral submissions in the two consolidated petitions challenging the fund.

The ruling hands the Ruto administration a significant victory in its push to establish the NIF, a vehicle the government intends to use to pool and deploy proceeds from the planned divestiture of state assets, including government stakes in Safaricom and the Kenya Pipeline Corporation, assets whose sale has itself been mired in controversy.

The conservatory orders, issued by Justice Mwamuye on December 24, 2025, had restrained the government from establishing, incorporating, registering, operationalising, or funding the NIF in any manner.

They were issued in two petitions filed by the Consumers Federation of Kenya (COFEK) and filed by Dr. Magare Gikenyi, Eliud Matindi and two others, both of which argued that the government was moving to set up the fund outside proper constitutional parameters.

Yesterday, those orders fell, undone in large part by Parliament’s own overnight action.

The morning’s dramatic sequence began the moment Lawyer Theuri, appearing for COFEK, rose to address the court, not to argue his client’s case, but to inform Justice Mwamuye that the ground had shifted entirely overnight.

“My Lord, I have just learned that the National Assembly has approved the National Infrastructure Fund Bill last evening,” Theuri told the court.

“In view of that development, and noting that some of the issues arising in this petition relate squarely to the issue of the establishment of the National Infrastructure Fund, I think it would be prudent that we take some time to review what has been passed in Parliament and then come back and take directions on how we are going to proceed.”

He urged the court against proceeding with submissions.

“It might not be a good usage of time, especially your time, My Lord, if we were to proceed with the highlighting of the submissions and then find that perhaps the exercise we have engaged in is largely academic in nature,” Theuri said.

Justice Mwamuye moved swiftly, delivering a short ruling that lifted the key blocking order in both petitions, reasoning that leaving the orders in place would ironically work against the petitioners themselves by barring them from seeking fresh legal redress.

“Noting the developments in this matter, and in light of the fact that when this court issued an ex parte conservatory order, the matter was at a juncture where no bill had been drafted or much less tabled before the National Assembly, this court lifts Order Number One of this court’s orders and directions dated and issued on 24th December 2025 in both petitions E834 of 2025 and E835 of 2025,” the judge ruled.

“The court takes this measure to facilitate the respective petitioners to take necessary actions as they so wish, and to prevent any person from moving courts in a fresh petition. if they so wish, being barred,” he added.

The judge noted pointedly that the petitioners themselves had confirmed the bill passed in Parliament was not covered by the petitions on their face.

“So those orders are lifted,” he said.

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In a detailed replying affidavit filed before the Constitutional and Human Rights Division at Milimani, Mbadi dismissed claims that the Executive had irregularly or illegally established the fund, terming the petitioners’ fears misconceived, speculative and unfounded in law.

The petition, lodged by four individuals, challenges Cabinet’s December decision to approve the establishment of the National Infrastructure Fund PLC, accusing the government of bypassing constitutional safeguards on public finance, parliamentary oversight and public participation.

The petitioners argue that creating the entity through a Cabinet resolution threatens transparency and violates multiple provisions of the Constitution, including Articles on sovereignty of the people, prudent use of public resources and separation of powers.

But Mbadi paints a different picture,one of a policy instrument designed to unlock private capital and accelerate Kenya’s long-term development ambitions in food security, transport, logistics, energy and the digital economy.

“On 16th December 2025, the Cabinet considered a proposal from my Ministry for the setting up of an entity whose purpose is to mobilize resources to finance large scale infrastructure,” Mbadi says.

“The entity is intended to mobilize excess of Kenya Shillings Five Trillion and to operate as a Limited Liability Company. The entity was christened, the National Infrastructure Fund.”

A central pillar of Mbadi’s argument is that despite its name, the National Infrastructure Fund is not a “fund” as contemplated under Article 206 of the Constitution, which governs public funds such as the Consolidated Fund.

“Though the entity was described as a ‘Fund’, its objects are not those of a ‘Fund’ within the meaning of Article 206 of the Constitution of Kenya, 2010,” he states, adding that the petitioners had “fundamentally misconceived, mischaracterized, and misrepresented the intention, structure, and legal design” of the proposed entity.

According to the CS, the NIF is intended to be incorporated under the Companies Act as a Government Owned Enterprise with full corporate personality,capable of suing and being sued, holding property and entering into commercial transactions in its own name.

He anchors this position on the Government Owned Enterprises Act, arguing that the law expressly allows the State to establish entities structured as public limited companies while remaining subject to oversight mechanisms.

Mbadi also takes issue with the conservatory orders obtained by the petitioners, which effectively froze the implementation of the Cabinet resolution.

He argues that the legal threshold for such orders was not met, insisting that no public funds have been appropriated or spent and that the process remains at an internal Executive stage.

“The Petitioners have not demonstrated that the failure to grant conservatory orders would render the Petition nugatory, particularly in light of the fact that no irreversible legal, financial, or operational actions have been undertaken,” he states.

He further warns that early judicial intervention risks undermining the doctrine of separation of powers.

“Judicial intervention at this stage would offend the doctrine of separation of powers, as the action sought to be challenged still lies wholly within the purview of the Executive.”

The Treasury boss emphasises that the entity has not yet been formally established, countering claims that the fund is already operational. “Contrary to the Petitioners’ allegation… the necessary processing is still underway,” he says.

A key concern raised by the petitioners is that placing vast financial power in a limited liability company could dilute parliamentary and audit oversight.

Mbadi, however, insists that the proposed structure strengthens rather than weakens transparency.

He outlines several statutory safeguards, including half-yearly performance reports to Cabinet and the National Assembly, mandatory audits by the Auditor-General, public disclosure of annual reports and board appointments, and budgetary appropriation by Parliament where required.

“Funding to the entity will be approved by Parliament in an Appropriations Act as envisaged in Article 221 of the Constitution,” Mbadi notes, adding that proceeds from privatisation would flow into the Consolidated Fund before any lawful withdrawal.

He maintains that the incorporation of the entity does not in any way diminish its public character, constitutional accountability, or statutory oversight, but instead provides a robust legal framework for the transparent, efficient, and responsible management of public resources.

On accusations that the government sidestepped public participation, Mbadi argues that the Cabinet decision was merely an internal policy determination that had not yet triggered legislative or financial action requiring public input.

“Public participation shall be undertaken at the appropriate stage where constitutional or statutory processes… are triggered, and it is therefore premature and speculative to allege a violation at this point,” he says.

He also defends the President’s role, stating that the Head of State acted within constitutional mandate in chairing Cabinet and approving policy direction, while Parliament would still exercise its legislative and appropriation powers when necessary.

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