About the Service
A limited company is a type of company which when set up allows an entrepreneur to keep their own assets and finances separate from the business itself.
This means that people who have invested in the business (the shareholders) are only responsible for the company’s debts up-to-the amount that they have invested and no more.
It is therefore a good way for a business to get investment without risk to personal wealth. Companies may be limited by shares or guarantees.
We will need these details when registering your company:
To be able to register a public limited liability company in Kenya, you first must open an E-Citizen account as registration can only be done by a director, lawyer, or Company Secretary:
Documents required for incorporation of a public company in Kenya:
Requirements for Shareholders/Directors:
A Limited Liability Partnership is a unique form of business association that combines elements of a company with those of a partnership.
It enjoys certain benefits enjoyed by limited liability companies such as limited liability for the partners, ability to hold properties in their name amongst others they are much simpler to register than companies that require amongst others memorandum and articles of association.
Registering a Limited liability Partnership in Kenya is a simple procedure:
According to World Intellectual Property Organization (WIPO), Intellectual Property refers to creations of the mind: inventions; literary and artistic works; and symbols, names, and images used in commerce. It can be divided into two categories:
As an investor, owner, or author of such intellectual property, you have rights and can prevent any person or entity from using your intellectual property without your permission along with giving due credit and even monetary compensation. One major advantage of having intellectual property getting registered is that your organization enjoys a better position among competitors.
A trademark is a mark or sign that distinguishes the goods of one entity from another.
The trademark may consist of one or more distinctive words, letters, numbers, drawings, pictures, signatures, colors, or a combination of all these. ServiceMark is a sign which serves to distinguish the services of one entity from another. It may consist of the same characteristics as those of a Trademark.
Any individual, company, partnership, or society can register a Trademark as long as they meet the necessary requirements. Registration of your Trademark gives you an exclusive right to that mark, it is evidence that the mark is yours and it affords you legal rights against others who may want to infringe your right to that mark.
Examples of Trademarks include Jogoo which is owned by Unga Limited, Toyota owned by Toyota Company. These marks have been registered by the respective companies and as such, they have exclusive rights to those marks.
Registering a copyright for your work whether literary, musical, artistic affords you exclusive right to print, publish, perform, or record any literary, artistic musical and authorize others to do the same. In Kenya, the law governing copyright is the Copyright Act and it makes it an offense punishable by fine or imprisonment to infringe on another person’s copyright. To whom can copyright be conferred?
What can be registered?
The Kenya Industrial Property Institute (KIPI) is the body mandated with the registration of Trademarks:
The NGO Co-ordination Act defines a “Non-governmental Organization” as a private voluntary group of individuals or associations, not operating for profit or commercial purposes, but have organized themselves nationally or internationally:
Registered NGOs obtain legal status in order to enable them to interact at the official level, and among donors and other organizations.Members are able to represent the organization, the NGO can open a bank account in the name of the organization, or sign contracts in the name of the organization.A registered NGO can also qualify for financial assistance from government agencies and local, national, and international donors.
Steps when registering an NGO in Kenya:
BoardFORM 1: Contact details of the proposed NGO and its contact person
A notification of the situation of the registered office or postal address of the NGO, signed by the 3 top officials
– the line ministry in which the proposed NGO will be operating in
– work plan of how the foreign NGO intends to carry out its activities for the first year of operation
– source of funds -administrative chart showing organization structure
2. Processing fees
Timeline – 1 day
3. Submission of Form 1 and 3 – KES 400
Timeline – within 90 days from the date of the payment processing fee
All applications should either be typed or filled in block letters. Applicants are encouraged to use the prototype constitution available on the NGO Board website. Constitutions that do not follow the given format will not be accepted.
A foreign NGO, also known as an international non-governmental organization (INGO) is an NGO incorporated outside Kenya. A foreign NGO looking to set up its branch in Kenya must adhere to the following requirements.
Registration requirements: The foreign NGO will lodge its application with the NGOs Co-ordination Board.
PRELIMINARIESThe foreign NGO members should convene a meeting wherein they agree and resolve to register a branch in Kenya. In the same meeting, they should propose three NGO names. The resolutions of the meeting should be reduced in writing and members sign against their names.
The foreign NGO should also obtain a recommendation letter from the country of origin where the NGO operates from. The recommendation letter should be notarized by a notary public from where it is issued from.
The foreign NGO should also obtain a letter of authorization from their headquarters authorizing to operate another branch in Kenya.
This is a written statement from the board of the foreign NGO, stating the purposes of the NGO, and a general description of the activities it is planning to carry out in Kenya.
This letter should also be notarized by a notary public from where it was issued from.
A foreign branch should also produce a notarized copy of the relevant registration certificate.
The requirements are similar as for a local NGO except with these additional requirements:
Timeline – within 90 days from the date of the payment processing fee.
The not-for-profit organization is a broad term for all independent organizations whose purpose is something else other than to make a private profit for directors, members, or shareholders.There are various types of not-for-profit organizations, these include but not limited to: NGOs, Companies Limited by Guarantee, Community-based Organizations, Societies, Trusts, and even the branch of a foreign organization.
A community-based organization (CBO) is a registered non-governmental, non-profit and non-political organization. Within community-based organizations (CBOs), there are many variations in terms of size and organizational structure.
Some community-based organizations (CBOs) with a written constitution and directors are formally registered and incorporated. Others are much smaller and informal, are registered by the Ministry of Labour and Social Protection.
Another type of not-for-profit business structure is the registration of a charitable trust or foundation. A trust is an entity created to hold and manage assets for the benefit of others.
Under the Trustees Act, trusts can be registered as body corporates and established only for religious, educational, literary, scientific, social, athletic, or charitable purposes.
Charitable purposes may also be affected by forming a trust by way of a trust deed. (The trustees of a pension fund or provident fund may also apply to be registered as a body corporate).
Societies in Kenya include charitable societies, private member clubs, churches, welfare societies, political parties, etc. They must be registered under the Societies Act for them to be functional.
A society is an association or partnership of ten or more people who have an office or headquarters, place, or business which must be located in Kenya.
The goal of a society is for religious purposes, cultural, political, patriotic, benevolent, or cultural reasons.
Societies are required to apply for registration after twenty-eight days from the day it’s formed. Society will not function if they don’t have authorization from the Registrar, this means if the society takes contribution or donation from its members then it will be considered unlawful.
Sole proprietorships are registered under the Registration of Business Names Act. A sole proprietorship is formed by only one person. It is easy to set-up and links the owner of a business to their company. Companies structured as sole proprietorships can include individual freelancers, creatives, growing startups, and established businesses with physical storefronts or workspaces. The ability to operate as a sole proprietor, without formal registration or high costs, is especially beneficial if you’re building your startup as a side gig, outside your regular day job. The ease of establishment means you don’t have to be 100 percent committed or invested financially to begin operations.
Requirements for registration of a sole proprietorship:
The Corporate Governance principles’ purpose is to facilitate effective, entrepreneurial, and prudent management that can deliver the long-term success of the company.
Roles and responsibilities of a Company Secretary in Kenya:
A board charter is a policy document that clearly defines the respective roles, responsibilities, and authorities of the board of directors (both individually and collectively) and management in setting the direction, the management, and the control of the organization.
Benefits of Board Charters:
If a company wishes to increase its Share Capital beyond its registered Nominal Capital, the Company will be required to file the following with the Registrar of Companies:-
NB: There will be a requirement to pay stamp duty on the increase in the capital; Stamp Duty payable will be at a rate of 1% of the increase.
Maintaining the following statutory registers:
Convening and attendance at Board and General Meetings and processing of minutes thereon. This will include preparation of the notices and agenda of the meetings and circulation thereof to the relevant parties.
The company secretary plays a leading role in good governance by helping the Board and its committees function effectively and in accordance with their terms of reference and best practice.
If a company wishes to increase its Share Capital beyond its registered Nominal Capital, the Company will be required to file the following with the Registrar of Companies:
Have you filed the annual returns? Well, you run the risk of being penalized and the company being struck off by the Registrar of Companies. Annual returns show the changes that have occurred at the company during the year such as change of shareholding, directorship, and registered office of the company.
Section 125 of the Companies Act stipulates that every company having a share capital shall, once at least in every year, make a return, and the said return shall be in the form and shall be made up to the date of the fourteenth day after the date of the annual general meeting.
The annual returns should be made at least once every calendar year.
The annual return is be completed within forty-two (42) days after the annual general meeting for the year of the annual return, and the company must within such period deliver to the registrar a copy of the annual return, signed both by a director and by the secretary of the company.
If a company fails to comply with this requirement, the company and every officer of the company who is in default shall be liable to a default fine as may be deemed fit by the registrar. It should be noted that the term “officer” as used here includes any person in accordance with whose directions or instructions the directors of the company are accustomed to act.
In filing the Annual Return, the completed form is submitted at the Companies Registry with the requisite fees before accepted for filing. Late filing of annual returns attracts a penalty for every year defaulted.
Keeping custody of the Company Seal. Kindly note that you will be required to submit to us the Company seal for safekeeping. You may choose to keep the company seal at the registered office.
You are probably thinking about incorporating a Company in Kenya but something is still not clear to you on the type of company that is best suited to meet or achieve your unique purpose.
Failure to make due considerations and identify the distinctive features has resulted in many unplanned conversions, overhead costs in effecting amendments, penalties on unknown requirements of the type of company incorporated, and many more unwarranted consequences. This may as well be avoided at the preliminary stages of pre-incorporation of Companies:
In the broadest sense, there are two types of Companies namely: Limited and Unlimited Companies. The companies are limited in the sense that they are held accountable to the debts of the Company to a certain extent. Such companies may therefore be limited by guarantee or share capital. Two categories of companies fall in this subpart.
These are public companies limited by shares and Private companies limited by shares. For unlimited companies, there is no limitation on the liability of members to pay the debts of the company and the members are jointly and personally liable for the debts in case of winding up. However, such companies are rarely incorporated nowadays but they may be necessary.
You can also check the section on registration services to look at the other business structures that may be suitable for you. Find the link here: Company Registration Services.