MasiboLaw

By Meshack Masibo

On 22nd August 2023, Kenya officially removed the 30% local shareholding rule that required foreign companies offering ICT services in Kenya to cede 30% of their local shareholding to Kenyans. The move caused ripples in both local and international circles as companies registered in Kenya that had long forsaken their activities after the introduction of the rule scampered to update their records and their licensing. More than anything, the move signaled a government decision to make it easier for foreign companies to set up in Kenya.

However, how exactly do you set up a foreign company in Kenya?

1. Fill the Application Form(s)

You will need to fill out the appropriate application documents as per the Companies Act 2015. These documents will require information such as details of the company’s registered office in its place of origin, the names and postal addresses of one or more persons resident in Kenya who is authorized to accept, on behalf of the company, service of the relevant notices. This will also include the prospective address of the business in Kenya and details of the company officials.

2. Notarize your Documents

Additionally, you will need a certified and notarized copy of your original certificate of incorporation or registration in your place of origin in English or where necessary a certified translation. Depending on the jurisdiction, you will also need a notarized copy of the company’s constitution, memorandum of association, charter, and other documents that make up the Constitution of the Company. All the documents must be originally in or translated into English. You will also need a list of directors and a notarized document detailing their duties and powers.

3. Appoint a Local Representative

Despite the removal of the 30% local shareholding rule, foreign companies still need to appoint a local representative to operate in Kenya. A local representative is the ‘boots on the ground’ for the company and is responsible for doing all the things the company is required to do. The local representative can also be potentially liable to a penalty imposed on the company for a failure by the Company to comply with the Companies Act.

4. Get Adjacent Licensing

Even with the coming of the e-citizen portal, company registration is not just about filling out some forms and paying the fees, it involves other intricacies as well. For example, if you are incorporating a local company to offer payment services or most types of financial services you will need to demonstrate that you have the appropriate license from the Central Bank of Kenya. This is why it is important to seek local legal advice on how to jump some of these hoops and register your company seamlessly.

The writer is a lawyer who specializes in offering legal services to people in technology. You can reach him through info@masibolaw.co.ke

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(This article is informative and should not be considered to be legal advice or to create a client-attorney relationship with the author. In case you need specific advice, please speak to a legal professional.)