Company Registration in Kenya: How to Register a Business in Kenya

Kenya is a prime destination for business investments, known for its robust economy and growing business landscape. Whether you’re a local entrepreneur or a foreign investor, understanding the company registration process in Kenya is essential for starting and running a successful business. This guide provides a detailed overview of company registration in Kenya, including the steps involved, necessary documents, and costs associated with the process.

Why Register a Company in Kenya?

Kenya offers numerous advantages for businesses, including access to a large East African market, strategic location, and a business-friendly regulatory environment. Registering a company in Kenya provides legitimacy, legal protection, and opportunities for growth through government tenders and contracts. Additionally, a registered business can open corporate bank accounts, access loans, and enjoy various tax benefits.

 

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Types of Business Entities in Kenya

When setting up a company in Kenya, you can choose from several types of business entities based on your needs and business objectives:

1. Sole Proprietorship:
   • Ideal for small businesses owned and managed by one person.
   • This is the simplest business structure and requires minimal registration procedures.
2. Partnership:
   • A partnership is formed when two or more individuals come together to run a business.
   • It offers shared control and responsibility.
3. Limited Liability Company (LLC):
   • The most common business structure in Kenya, particularly for foreign investors.
   • It provides limited liability to its owners, meaning personal assets are protected from business liabilities.
4. Public Limited Company (PLC):
   • Designed for large businesses with the intention of raising capital from the public by selling shares.
   • This entity is subject to stringent regulatory requirements.
5. Branch Office of a Foreign Company:
   • For foreign entities looking to establish a presence in Kenya without creating a separate legal entity.
   • The branch operates as an extension of the foreign company.
6. Non-Governmental Organization (NGO):
   • For organizations focused on non-profit initiatives.

Requirements for Registering a Company in Kenya

The requirements for registering a company in Kenya depend on the type of business entity. Below are the key requirements for registering a Limited Liability Company, which is the most popular structure for both local and foreign investors:

1. Company Name:
   • You need to reserve a unique company name. The name search and reservation are done through the eCitizen portal.
2. Directors’ Information:
   • A company must have at least one director. For foreigners, a certified passport copy, a passport-sized photo, and proof of residency (such as a visa or entry permit) are required.
   • For locals, a national ID and KRA PIN are necessary.
3. Shareholders’ Information:
   • A minimum of one shareholder is required. Shareholders can be either individuals or corporations.
4. Memorandum and Articles of Association:
   • This document outlines the company’s structure, governance, and the objectives of the business.
5. Registered Office Address:
   • A physical office address in Kenya is mandatory. This will be the official location where company records are maintained.
6. Company Secretary:
   • For companies with a share capital exceeding KES 5 million, a certified company secretary must be appointed.

Step-by-Step Process for Registering a Company in Kenya

Here’s a step-by-step guide to registering your company in Kenya:

1. Name Reservation:
   • Log into the eCitizen portal, which is the official government portal for online services.
   • Submit your proposed company name for approval. The registrar will check if the name is available and complies with naming guidelines.
   • If approved, the name is reserved for 30 days, during which time you can complete the registration process.
2. Prepare and Submit Company Documents:
   • Prepare the Memorandum and Articles of Association, detailing the structure and objectives of the business.
   • You will also need to fill out Form CR1 (Application for Registration), CR2 (Notice of Registered Address), CR8 (Notice of Residential Address of Directors), and any other relevant forms.
3. Pay the Registration Fees:
   • Registration fees vary based on the company’s nominal capital. You will also be required to pay a stamp duty fee based on the company’s share capital.
   • The registration process is completed once payment is made via the eCitizen platform.
4. Obtain the Certificate of Incorporation:
   • Upon successful registration, the Registrar of Companies will issue a Certificate of Incorporation. This is the official document confirming the legal existence of your company in Kenya.
5. Register for KRA PIN:
   • Once incorporated, you need to register the company for a Kenya Revenue Authority (KRA) PIN to comply with tax regulations. The KRA PIN will be used for filing tax returns and other business transactions.
6. Obtain Necessary Licenses and Permits:
   • Depending on your business, you may need additional permits and licenses to operate. These include a business permit from the county government, sector-specific licenses, or environmental licenses.

Company Registration for Foreigners in Kenya

Foreigners can register companies in Kenya under the same procedures as locals but with a few additional considerations:

1. Work Permits:
   • Foreign directors must have valid work permits to actively engage in business operations within Kenya.
2. Minimum Investment Requirement:
   • For certain types of businesses, foreign investors may need to meet a minimum capital investment requirement, typically around $100,000  when applying for a work permit( See work permit application).
3. Foreign Directors:
   • A foreigner can be the sole director of a company, but if the company has more than one director, at least one must be a resident of Kenya or engage a local certified company secretary(CPS).
4. Branch Office Setup:
   • Foreign companies wishing to establish a branch in Kenya must file additional documents, including certified copies of the parent company’s Memorandum and Articles of Association and a Certificate of Incorporation.

Cost of Registering a Company/Business  in Kenya

At  Blue Ocean Outsource we offer  a variety of business startup services to enable locals and foreigners set up operations in Kenya without difficulties. Below are our  four main packages offered for business registration, providing clarity on costs, requirements, and services.

1. Basic Sole Proprietorship Registration Package – KES 5,000

This package is ideal for individuals looking to start a small business on their own. It covers the basic essentials required to get your sole proprietorship legally recognized in Kenya.

What’s Included:

• Business name search and reservation.
• Registration of a sole proprietorship with the Business Registration Service (BRS).
• Issuance of a Business Name Certificate of Registration.

Who is it for?

This package is perfect for small business owners, freelancers, consultants, or anyone looking to operate independently under a registered business name without the complexities of a limited company structure.

2. Standard Limited Company Registration Package – KES 20,000

For entrepreneurs seeking to register a limited liability company (LLC) with a more structured and legally protected business entity, this package is an excellent choice. It offers more in terms of legal protection and credibility for your business.

What’s Included:

•  Registration certificate
• Articles and Memos
• CR 12,
• MEMART(CR1, CR2, CR8)
• Pin cert for company
• KRA Tax Compliance Certificate
• Beneficial ownership information (BOF)
• Who is it for?

This package is best suited for startups, SMEs, and entrepreneurs who want a more formal business structure with limited liability, separating personal assets from the company’s liabilities.

3. Comprehensive Limited Company Registration Package with Company Seal – KES 35,000

This package builds on the Standard Limited Company Registration package but offers additional benefits such as the creation of a company seal, which adds further credibility and professionalism to your business operations.

What’s Included:

• All services in the Standard Limited Company Registration Package.
• Issuance of a Company Seal for official documentation.
• NSSF and NHIF registration
• AGPO Certificate
• IFMIS registration

Who is it for?

This package is ideal for companies that need to issue official contracts, certificates, and other documentation that requires a company seal for authentication. It’s especially suitable for businesses aiming to deal with government entities or large corporations.

4. Premium Limited Company Registration Package (Foreign-Owned Company) – KES 60,000

For foreign investors looking to establish a business in Kenya, this premium package simplifies the process by handling the unique requirements needed to register a foreign-owned limited company.

What’s Included:

• All services in the Standard Limited Company Registration Package.
• Issuance of a Company Seal for official documentation.
• A basic company website
• NSSF and NHIF registration
• Assistance with obtaining necessary business permits.
• Guidance on compliance with foreign investment regulations in Kenya.

Who is it for?

This package is specifically designed for foreign investors and multinational companies seeking to establish a presence in Kenya. It provides a seamless registration process while ensuring compliance with Kenyan laws governing foreign-owned businesses.

Post-Registration Requirements

Once your company is registered, you must comply with ongoing legal obligations, including:

1. Tax Compliance:
   • You are required to file annual tax returns and pay taxes, such as income tax, VAT (if applicable), and Pay As You Earn (PAYE) for your employees.
2. Annual Returns:
   • Every registered company in Kenya must file annual returns with the Registrar of Companies, indicating the company’s financial position and any changes in directorship.
3. Corporate Bank Account:
   • You will need to open a corporate bank account in Kenya to facilitate financial transactions.

Benefits of Registering a Company in Kenya

• Access to Local and International Markets: Kenya is a gateway to the East African market, offering access to regional trade blocs such as the East African Community (EAC) and the African Continental Free Trade Area (AfCFTA).
• Government Incentives: The Kenyan government offers several incentives, including tax holidays and rebates, particularly for investors in sectors like manufacturing, ICT, and agribusiness.
• Legal Protection: Registered companies in Kenya enjoy legal protection, ensuring the rights and obligations of directors and shareholders are clearly defined.
• Enhanced Credibility: Registered businesses are more credible in the eyes of investors, suppliers, and customers, boosting trust and opportunities for growth.