Starting a company in Kenya is a bit of a hustle and involve a few steps that are time consuming. This makes majority of entrepreneurs opt to go for partnership or sole-proprietorship type of business as these takes less time and less money and can change the model of registration while they have been in operation and understand the market.
Company Registration in Kenya – Registering a Company in Kenya
Proposed company name must be reserved pending registration (Name can only be reserved for thirty days). Application for reservation should be made in writing and be accompanied with the requisite fee.
- Documents for incorporation of company (i.e. memorandum and ) should be drawn by a lawyer, who should submit the Articles of Association to the Registry together with the prescribed forms and fees. These forms are obtainable at the Registry.
- All companies must appoint a qualified certified public secretary as company secretary
- Certificate of Incorporation is processed within 7(seven) days of presentation of PROPERLY completed forms.
- Refusal of registration is communicated in writing to the applicant.
NOTE: A registered company MUST forthwith comply with the requirements of the Companies Act, e.g. filing of Annual Returns.
Company Registration in Kenya – Registration Forms
Company Registration in Kenya – Private Companies
- Particulars of Directors and Secretaries.
- Notice of situation of Registered Office.
- Declaration Of compliance.
- Statement of Nominal Share Capital form.
Company Registration in Kenya – Public Companies
In addition to the above Forms, Public Companies must also submit
- Consent to act as Director of a company.
- List of persons who have consented to act as directors.
- Declaration that the provisions of sec. 111(2) b have been complied with Statement in lieu of prospectus.
Company Registration in Kenya – Foreign Companies
- Certified copies of foreign companies memorandum and Articles of Association and Certificate of Incorporation duly certified by a Notary Public.
- List of documents delivered for registration by a company incorporated outside Kenya.
- List and particulars of the directors and secretary of a company incorporated outside Kenya.
- List of names and addresses of the persons resident in Kenya authorized to receive service on behalf of a company incorporated outside Kenya.
- Notice of situation of registered or principal office or change therein of a company incorporated outside Kenya.
Company Registration in Kenya – Fee Schedule.
|Registration of companies||Fees is dependent on the nominal share capital of the company(fees assessment can be obtained from the cashiers)|
|Filing any form required to be filed with the Registrar under the relevant Act||200/=||N/B Default fee is payable if such form is not lodged within the prescribed period.|
|Registration of charges||600/=|
|Registration of debentures||600/=|
|Filing of Annual Return||400/=||N/B Default fee is payable if return is not filed within the prescribed period|
|Filing of Resolution||1,100/=||N/B Default fee is payable if Resolution is not filed within the prescribed period.|
Steps towards registering a business in Kenya
One must register with the Registrar General’s office and Kenya Revenue Authority to make the business a legal entity. Several bureaucratic and legal requirements must be met to incorporate and register a new firm, along with their associated time and set – up costs.
Business Registration in Kenya – Business Name Registration
First and foremost, one has to gain approval for the preferred business name from the office of the Registrar General through application. The company name reservation lasts between seven and 30 days.
Business Registration in Kenya – Stamp Duty
After name reservation, one has to pay for stamp duty at any Kenyan bank. A stamp duty is a tax levied on legal documents and without it, the document requiring the stamp will be deemed unsuitable. As an administrative requirement, KRA now requires the personal identiﬁcation numbers of all parties on whose behalf duty – stamped documents are submitted. Documents must be first assessed by the Stamp Duty Office before payment can be processed by the KRA – designated banks. The process takes ﬁve days and usually 1 percent of nominal plus Kshs 2, 020 stamp duty on memorandum and articles of association.
Business Registration in Kenya – Incorporation
The third step is to tile incorporation documents and evidence of the stamp duty with the KRA, the process is followed by a declaration of compliance (form 208) signed before a commissioner of oaths or a notary public.
The notarisation usually costs about Kshs 200. The notarised form 208 will later be submitted to the Registrar General. The required incorporation documents include the memorandum and articles of association and the statement of nominal capital.
Each clause of the memorandum and articles of association describes elements of the business, such as whether it is limited liability or another company structure.
A skilled lawyer will ensure that the documents meet the Kenyan regulations. Other documents required at this stage include form 201, Notice of Situation of Registered Office; form 203, Particulars of Directors and Secretary In order to process the request, one has to provide the KRA with the Personal Identification Numbers of every individual involved in the creation of the business including all officers, directors and board members. PINS are obtained from the Tax Department at KRA. The entire process takes ﬁve to 10 days. You must submit the certiﬁcate of incorporation and receive log—in details from the KRA for the purpose of applying for PIN and VAT registration.
Business Registration in Kenya – Business permit
Fees vary by type of business, number of employees, and size of the premises. The fee is payable to the Nairobi City Council, Licensing Department, or county revenue departments.
For instance, medium trader, shop, or retail service from five to 20 employees and / or premises 50 to 300 square metres at a fair location),Kshs 5,000 is charged.
The Licensing Laws Act, 2006, amends the Local Government Act (Cap.265) by reducing the number of business permits required for a distributor of goods or provider of services to carry on its business activities. This is then followed by registration with the National Social Security Fund (NSSF. Afterwards registration for PAYE is followed and ﬁnally a company is free to make a company seal after a certiﬁcate of incorporation has been issued.
Finally, once approved, the Registrar General will issue a certiﬁcate of registration which allows the business to commence operations.
A foreign company wishing to open a branch office in Kenya can do so at the Registrar of Companies.
Legal requirements that registered businesses must acquire include VAT number, Personal Identiﬁcation Number (PIN), National Social Security Fund (NSSF) number, and the National Hospital Insurance Fund (NHIF) number. Other requirements are specific to business type.
Business Registration in Kenya – How To Register A Sole Proprietorship / Partnership
The procedure to register a sole proprietorship / partnership in Kenya is pretty easy and should not cost more than Kshs 900/-. Here is what you need to do:
- Pick out a business name that you wish to register. Write a simple letter addressed to the “Registrar General”. This letter need only ask the registrar to confirm if your chosen business name is available for registration.
- Make your way over to Sheria House, and to the Registrar of Companies within the Sheria House compound.
- Go over to counter No 1 and hand in your letter(s). You will need to pay Kshs 100 for every name that you wish to register. This is what is called “business name search”. The process takes three days to a week, max (usually). You will receive a blue receipt.
- Three days after handing in your letter, go back to Sheria House and show the attendant your receipt. If your chosen name is available for registration, you will receive a letter from the registrar of companies that, basically, tells you your name search was successful. You will also receive a form, Form BN/2.
- What you need to do is fill out Form BN/2 as completely as possible. If you are registering a sole proprietorship, the part where it says “Particulars of proprietor or partners” will bear only one name, otherwise you can put in up to 20 partners (for a partnership).
- Go back to Sheria House and hand in your completed Form BN/2. You will need to pay Kshs 800/-. After a week or so, you will have to go back to Sheria House to collect your business registration certificate. Congratulations, you shall then have registered a new business!
Business Registration in Kenya – About Partnership
The process of registering a sole-proprietorship and partnership is the same at Sheria house.
However, because of the unique nature of partnerships (the fact that one partner’s actions can make other partners equally liable) it is recommended that one also registers a partnership deed that clearly defines rights, duties and obligations of all partners.
A partnership deed once drawn up is supposed to be registered as a public document at the Ministry of Lands.