The main types of business enterprises in Kenya are as follows:
- Registered Companies (Private and Public)
- Branch offices of companies registered outside Kenya
- Sole Proprietorships
Kenya’s new Companies Act of 2015 provided two significant changes to company law in Kenya. First, individuals can now form private or public companies where formerly two directors were required. Second, a template for Memorandum and Articles of Association was introduced that can easily be adapted to most enterprises.
An Outline of the Process and Timeline To Register a Local Company in Kenya
|No.||Procedure||Time Taken||Associated Costs|
|1||Reserve a unique company name online at www.ecitizen.go.ke.||2 days||KES 100 (€0,88) per name|
|2||Receive stamp duty assessment on the Memorandum and Articles of Association and the statement of nominal capital||1 day||1% of nominal capital plus KES 2,000 (€17.76) for stamp duty on (adopted) Memorandum and Articles of Association|
|3||Pay stamp duty||1 day||KES 110 (€0.98)|
|4||Adopt/stamp the Memorandum and Articles of Association and statement of nominal capital||1 day||No charge|
|5||Sign Declaration of Compliance before a commissioner of oaths or a notary club||1 day||KES 200 (€1.78)|
|6||Register with the Registrar of Companies at the Attorney General chambers||12 days (average)||KES 9,280 (€82.85)|
|7||Register for taxes at Kenya Revenue Authority||1 day||No charge|
|8||Apply for a business permit||5 days||KES 15,000 (€133.21)|
|9||Register with National Social Security Fund (NSSF)||1 day||No charge|
|10||Register with National Hospital Insurance Fund (NHIF)||1 day||No charge|
|11||Make a company seal and rubber stamp||1 day||KES 3,500 (€31.08)|
Registering a Partnership
A partnership is restricted to a maximum of 20 people and a minimum of two, each of whom is jointly and separately liable for all debts incurred. If these numbers are exceeded, the partnership must be registered under the Companies Act. The business names to be used by the partnership must be registered under the Registration of Business Names Act.
Registering Sole Proprietorship
A sole proprietor is personally liable for all debts incurred. Where a proprietor does not trade under his or her personal names, the business names used by the proprietor should be registered under the Registration of Business Names Act. The proprietor is required to file the Statement of Particulars form with the Registrar of Companies together with a filing fee of KES 800 (€ 7.14). The Registrar will then issue a Certificate of Registration. The process can take four weeks.
Registering a Society
Societies are usually formed for the purposes of trade associations and similar organisations. The society submits its application including its constitution in duplicate and a fee of KES 2,000 (€17.85) to the Registrar of Societies for certification, which may take up to 120 days.
Businesses operating in certain sectors in the economy need to be licensed by the relevant regulator. For example:
- Banks require licenses from the Central Bank of Kenya
- Insurance companies require licenses from Insurance Regulatory Authority
- Telecommunication companies from Communication Authority of Kenya
- Mining companies from the Commissioner of Mines
- Companies listed on the Nairobi Securities Exchange are regulated by the Capitals Market Authority