Company Registration in Kenya.
Company Registration in Kenya is perhaps the most exciting part of any entrepreneurial journey. This is where it starts. You’ve got an idea, a product, a dream – but first, you need to do the paperwork.
Of course, paperwork and admin are not what excites an entrepreneur. You want to build your business, not fill in forms. That’s fair enough – but, of course, you need to tick all the legal boxes before trading in the Kenya. How long the company incorporation process takes is up to you. It can be a tricky process, with lots of time spent on hold or waiting for letters.
Or the process can be quick and painless. The difference is whether you are properly set up and prepared before applying to Register a Company in Kenya. Having your house in order before will dramatically simplify and speed up company incorporation.
Not sure what you need? That’s ok – 2Max Group is here to help you. Read on to discover what’s needed for company Registration in Kenya. We’ll give you details on what’s needed, the documents required and answer some common questions on the topic.
What Is Company Registration?
So what exactly is company Registration? It’s a technical-sounding term — but its meaning is quite simple. Company registration is the process by which a new (or existing) business registers as a limited company.
A limited company is a helpful structure for entrepreneurs since it’s entirely separate from you. Your risk is — as the name suggests — limited. Any debt, losses, or legal claims associated with your company are not your responsibility. The company is a distinct legal entity. A ’person’ in its own right.
Many people in the Kenya, by comparison, are sole traders. This means the company and the owners are one and the same. A limited company clearly demarcates the person and their business.
This is a great benefit — but it’s more admin. Like anything in life, it’s a trade-off. But one that’s worth making if you’re serious about growing your business long-term.
How To Register a Company in Kenya
Right, so you’ve decided that a limited company is the right corporate structure for you. Long term, it’s a good move (in our humble opinion). But there are a few things you need to determine and sort out beforehand.
Here’s what you need to form a company in Kenya:
Kenya’s Business Registering Service has made company registration in Kenya easy for locals via the eCitizen portal. The platform allows individuals to carry out the entire process from name search to actual registration at your convenience. Getting a business formalized is essential to benefit from certain corporate and government protection.
There are four business entity structures Kenyan individuals and groups typically look to register in the country. These companies are categorized as follows
1. Private Company limited by shares: This type of company has a share capital and the liability of each member is limited to the amount, if any, unpaid on their shares. A private company cannot offer its shares for sale to the public and may not have more than fifty (50) members.
2. Public limited company: A public company has share capital and limits the liability of each member to the amount unpaid on their shares. It may offer its shares for sale to the public and may be listed at the securities.
3. Companies limited by guarantee: This type of company does not have share capital and its members are guarantors rather than shareholders. The liability of members is limited to the amount they agree to contribute to the company’s assets if it is liquidated.
4. Unlimited liability companies: This type of company has no limit on the liability of its members.
Company Registration requirements in Kenya
Registration, and by extension incorporation of both private and public companies follow the same procedure in Kenya. The necessary requirements for registration are;
1. Proposed Company/Business name
The proposed business name search is conducted to ensure it is not similar to an existing registered business. If approved, it is reserved for 30 days. BRS requires a minimum of 3 names to be submitted.
2. Objectives of the Business
This is essentially the business that the company is being set up to carry out. This business must be entirely legal and not against public policy.
3. Names of the Directors, contact details and email
For transparency and accountability purposes, KRA requires that the director’s information be indicated on the application for registration.
4. Proof of Identification
A valid and unexpired proof of identification must be provided for each director. A national identity card suffices for Kenyan citizens
5. Passport Photo
A clear and recent passport photograph must be provided for each director and officer of the company.
6. KRA PIN
All directors whether resident or non-resident are required to provide a Kenya Revenue Authority (KRA) Personal Identification Number (PIN) certificate copy to prove registration with the tax authority.
In addition, the following forms must be signed by all directors and submitted during registration
7. Form CR1 – This is the company registration form.
8. Form CR2 – This is the Memorandum of company with share capital
9. Form CR8 – This is the notice of registered address form and
10. Statement of Nominal capital by all Directors.
The Kenya Business Registration Services Act 2015 aims to ease the operation of businesses in the country. Company registration processes are now online and must be done on the E-Citizen platform. Payment is made via electronic means such as mobile money, credit, or debit cards.
How to register a business name in Kenya?
A business name registration is an affordable alternative to the incorporation of a company in Kenya however, this structure does not offer the protection of limited liability. Registration starts with reservation of business name, after approval, registration commences. The proprietor must specify the nature of business, the application must indicate the physical address of the business and proprietor(s) details. All documentation must also be signed. Foreigners are only allowed to incorporate a company and the process is slightly different.
How much does it cost to register a business in Kenya?
The cost associated with business registration depends on the type of entity to be registered. BRS keeps a comprehensive fee schedule that can be accessed here.