Company Registration Process in Kenya

Company Registration Process in Kenya

Documents required to register a company in Kenya   

The following are the requirements for registering a company in Kenya.

When forming a limited company in Kenya, Kenyan law requires that certain documents submitted by the persons involved in incorporating the company.

These documents incorporate personal documents of the persons registering the company and legal documents.

  1. A proposed company name.
  2. Objectives of the Company. The nature of Business/activities the company shall undertake. 
  3. Full names of the shareholders.
  4. Names of the Directors in full if different from the shareholders.
  5. Shareholders/directors details (postal address, email address, and telephone Numbers)
  6. A number of shares to be held by each shareholder.
  7. The proposed physical address of the company. The Physical Address includes road, plot number, town, county.
  8. Copy of ID / Passport of the Shareholders / Directors.
  9. Passport photos of the Shareholders / Directors.
  10. Copy of KRA PIN certificate of the Shareholders / Directors.

The legal documents that you must submit to the registrar of companies include:

  • Memorandum of Association – This is a document that sets up the company’s constitution and objectives.
  • Article of association – This document comprises the rules and regulations by which its internal affairs are governed. It deals with matters such as share capital, directors, shares, company meetings, among other things.

These documents above must be signed by a minimum of 7 people in a public limited company or a minimum of 2 people for private limited company. If the company has a share capital, each share contributor must write opposite to his/her name, the total number of shares owned.

Other documents that must be submitted include:

  • Statement of Nominal Capital – This document states the amount of nominal capital in Kenyan Shilling. The stamp duty is paid when registration is determined by the share capital stated by the company. The document is only required, though, if the company has a share capital.
  • Particulars of Directors and Secretary – This document is under section 201 of the Companies Act.

Process of Registering a Company in Kenya

Any person wishing to register a company in Kenya should lodge with the Registrar of Companies the following documents:

  1. Application and reservation of the company name
  2.  We begin the registration of a company in Kenya with the search for the desired company name. The Registrar of companies in Kenya can only register a name that is not the same as the other registered company in Kenya. The Registrar of Companies has issued out new requirements for the name to be registered.
  3. The Registrar of Companies approves and issue the applicant with a letter confirming that the name is available for registration.
  4. Form CR 1– assist you in preparing the application for registration of a company in Kenya. You will require the following details;
    1. The registered office of the Company in Kenya
    2. Director/shareholder details
    3. Liability of members (by shares or guarantee)
    4. If the company is private or public, consent of the director/secretary
    5. Address of the agent making the application of the Registration of the Company in Kenya
  5. Form CR 2 – We will abide by the Registrar of Companies in Kenya, the association’s model memorandum. Please note that, except stated explicitly in the memorandum, the company will not be restricted in the business it carries out.
  6. The Statement of Nominal Share Capital duly stamped upon payment of stamp duty. The fee of stamp duty has soon been waived, and this is no longer a requirement to register a company in Kenya.
  7. The Notification of directors’ residential address. (Form CR8)– We will lodge with the Registrar of Companies a notification of the director’s residential address. The Registrar of the Companies in Kenya demands all directors to provide comprehensive details of their residential address; this includes the plot no, physical address, road, building, and postal address.
  8. The Articles of Association – We may help a company prepare its articles of association or adopt the model articles provided in the Kenyan Companies Act.
  9.  Identification documents- The Kenyan Companies Act dictates that directors must provide the national identity card, passport photographs, and KRA PIN Certificates.

Requirements to register a company in Kenya

Directors

For Kenyan, Citizens attach copies of:

  1. Identification Card (ID)
  2. Personal Identification Number certificate (PIN)
  3. Passport size photo (colored)

For Foreigners attach copies of:

  1. Passport pages with biodata
  2. Passport size photo (colored)

Corporate Shareholders

Attach a copy of the Certificate of Incorporation of the company.

It is essential to highlight the following basics:

  1. One person may form a company in Kenya.
  2. There are several types of companies. However, this article explains the process for the formation of a Private Limited Liability company.
  3. A private company restricts members’ rights to transfer shares in its constitution. The company limits the number of members to fifty, prohibits the invitation of members of the public to subscribe to its shares, and its certificate of incorporation states that the company is private.
  4. The company has a corporate personality. This means that a company is a legal person capable of suing, owning property, and entering into contracts.

With the above in mind, let

How to register a company name

 us delve into the formation and registration process of a company. On online platform e-citizen

1. Create an e-citizen account

You must always have an e-citizen account to access government services. To create an e-citizen account, you need your national id, email address, passport photo, and phone number. You may make your application here.

Reserve a unique company name using e-citizen. The Companies Act, part V, addresses provision for company names. Ideally, Applicants may search and reserve company names online on e-citizen.

Upon applying, one makes payment via mobile money and receives a confirmation of the name reservation within the same day.

The name is reserved for 30 days and may be extended to a maximum period of 60 days from reservation time. It is essential to note that the application for reservation of a name can be rejected when it is similar to an existing name, is offensive or fails the desirability tests

  1. Apply and pay for the registration of the company

In this case, the Applicant fills in the details in the fields on e-citizen. The application can be made here. One is expected to provide the following information:

  1. Articles of association
  2. Registered office address
  3. Share information
  4. Ownership information

The Applicant may either adopt the model articles of association provided under the Companies Act or modify the articles as he considers fit.

Subsequently, the Applicant pays the directed fee (usually a KES 10,000 (registration fee) + KES 600 (CR2 or company search fee) + KES 50 (convenience fee). It may be done through mobile money(M-Pesa), credit card, or whatever other stipulated method.

Once payment is made, the platform generates the following forms:

  1. Details of the initial directors, Secretary and Authorised Signatory of the Company: This form must be signed by all the first directors, secretary and authorized signatory of the company
  2. Form CR 2 (Company memorandum with shares capital): This form is signed by all the contributors to the shares of the company
  3. Form CR 8 (Notice of Residential Address/Change of Address of Director of a Company)-This the applicant signs form.
  4. Statement of Nominal Capital: either approves this of the first directors of the company

One is needed to download the forms, sign them, and re-scan them back to the system. The Registrars at the Company registry consider your application, and if successful, one is issued with a certificate of incorporation.

Tax Requirements

Company Pin

Income from the businesses is taxable under the Income Tax Act. Thus, the Tax Procedures Act compels companies to register for a company pin. Remember, a pin is expected for the filing of returns.

To apply for a pin, a company must have the following documents:

  1. Copy of Certificate of Incorporation.
  2. Copy of CR12.
  3. Copy of Memorandum and Article of Association (optional).
  4. Copy of PIN Certificate for one of the company’s directors.
  5. Copy of Tax Compliance certificate of one of the company’s directors.
  6. Copy of the Acknowledgement receipt.

KRA Pin registration is done online via iTax. The procedure is: Visit the iTax portal; choose “New PIN Registration”; Fill the online form appropriately; Submit an online application.

NOTE: Upon completion, you receive an acknowledgment receipt

A follow-up email is sent to you with either further instructions on where to present the required documentation for verification or a KRA PIN certificate.

VAT Registration

Under the Value Added Tax Act, either person whose business is expected to/makes taxable supplies worth KES 5,000,000 for up to twelve months to apply for a VAT.

You can apply for VAT here

What is the cost of registering a company in Kenya?

  • Name search: Ksh. 150
  • Company registration: Ksh. 10,650
  • Partnership and Sole proprietorship: Ksh. 1,000

How to confirm the company registration number in Kenya

You can check if the company is registered through the E citizen Portal following the process below:

  1. Login to your E-citizen account.
  2. Click the <Business Registration Service> link and select the <Make Application> option
  3. You will see a list of services you select the one called <official Search(Third-party Application)>
  4. You will see a pop up prompting you to apply with the fee indicated as Ksh. 650.
  5. Click <Apply Now> and enter the name of the company you are searching on.
  6. The company’s name will be shown. Click on it and select <Next>
  7. Enter your Postal Address and Postal Code and click <Continues>
  8. Verify the information and click <Finish>
  9. Choose the payment mode and pay the Ksh. 650
  10. Upon successful payment, you will be directed to a page called <application details> where you will download Form cr12 containing information of the company you are looking.

How do I change my company name to a limited company in Kenya?

Many Start-Ups in Kenya begin as a Business Name and then, afterward, convert the Business Name into a Limited Company. The process of transforming a Business Name into a Company in Kenya is usually undertaken. Thus, the Business may enjoy the benefits of a Limited company that include but are not limited to the following;

  • A Limited Company is considered an Independent legal Entity, as a shareholder, the liability is limited to the length of your share Contribution in the company.
  • They outlive the shareholders’ lives in case of the death of a shareholder because the shares may be transferred to another entity.
  • A Limited Company has a definite competitive advantage, which allows for more substantial profits.
  • A Limited Company presents a more professional image. In some instances, specific sectors, contractors, or agencies prefer to work with a Limited Company because of legal protection.

The Procedure to Convert a Company Name into a Limited company in Kenya is as Follows

  • The First step is to link the business on the e-citizen portal to verify information details and Business ownership.
  • The next step is to cease the Business Name by Filling form BN 6.
  • Upon successful cessation, the business ceases operations, and then you are free to register a Company as per the requirements for Company Registration in Kenya under the Company’s Act.                        

Can a foreigner own a company in Kenya?

Yes, Usually, Kenya law requires that foreigners wanting to own or run a business in Kenya to get a work permit from the Ministry of Immigration. The type of license applied for depends on whether the foreigner is the business owner or merely an employee.

How can a sole proprietorship be converted to a private limited company in Kenya?

The Procedure to Convert a sole-proprietor Name into a Limited company in Kenya is as Follows

  • The First step is to link the business on the citizen portal to verify information details and Business ownership.
  • The next step is to cease the Business Name by Filling form BN 6.
  • Upon successful cessation, the business ceases operations, and then you are free to register a Company as per the requirements for Company Registration in Kenya under the Company’s Act.

How do I change company directors in Kenya?

When you want To add or remove a limited company director in Kenya, the following steps must be followed.

Step 1: Fill a form of transfer of shares which is filled and signed by all the concerned parties.

Step 2: Fill form 203 A to confirm the outgoing directors or incoming directors

Step 3: Fill the annual returns form to indicate that company returns have been made. The form should be signed by one of the directors.

Step 4: Request a for a CR12 letter by writing an application letter to the registrar of companies.

Step 5: During the Annual General Meeting, minutes must be signed by the company chairperson and the company secretary. The minutes should show precisely that the directors agreed to add or remove directors.

Step 6: In case a director is leaving the company, he/she should provide a resignation affidavit that can be in the form of a resignation letter.

It is important to note that based on the memorandum and articles of association, for a director to be disqualified, one or more of the following thresholds have to be met.

  1. A director decides to resign from the office by reporting the company his/her wish by writing.
  2. A scenario where a director is removed from office by following the Article 32 or regulation 96 of Table “A” from part 1
  3. In the case where one of the directors becomes bankrupt.
  4. In a case where a director is prohibited from being a company director, it is specified under section 189 of Companies Act.
  5. In a case where one of the company directors is declared to be of unsound mind.

How To Add or Remove Director In Limited Company on the e-citizen portal 

Here are the steps required to be followed to add or remove a director from your existing limited company;

  1.  Copy of Certificate of Incorporation and as well a copy of Memorandum will be required.
  2.  The residential address of all director(s). Please note the physical address should include (house number, house name or building name, street/road name, town).
  3.  The Share allocation – you’ll require to indicate how much shares will be allocated to the new director(s) and if the current shareholding for existing director(s) change.
  4.  Proof of identity documents for the new director(s) including a copy of ID/Passport, a copy of KRA PIN, and Photo.
  5.  A Special Resolution meeting minutes showing location, time, and date of the agreement to adding new director & changes of shareholding. It is needed to prepare the Company Meeting Minutes that need to be used to endorse the company’s changes. You will as well require to mention who was present in that meeting.
  6.  Transfer form of shares duly filled and signed by both parties
  7.  The annual returns form must be filled and signed by one of the directors and the company secretary, confirming that returns have been paid up to date/Interim returns.
  8.  The Application letter to the registrar of companies requesting for CR12
  9. The Affidavit of resignation is needed to be done for any outgoing director(s). It may be in the form of a resignation letter.
  10. Get a transfer deed from a lawyer and upload it to the eCitizen application.

When you’ve complied with all the requirements and signed all relevant documents, the Company Registry issues you with a CR12 letter indicating the company’s new ownership structure that you can use for your business.

The Cost Estimate: Ksh. 5,000 – 15,000 (depends with the service provider)

Duration: Up to 2 weeks (depending on the workload of Company Registry)

Please note that based on the Memorandum & Article of Association, to disqualify a director (s), one of the following thresholds must be met;

(a) A director is removed from office according to Regulation 96 of Part I of Table “A” or Article 32 hereof;

(b) A director resigns his/her office by notice in writing to the company;

(c) A director becomes bankrupt or makes any arrangement or composition with his/her creditors generally;

(d) A director becomes prohibited from being a director because of any order made under Section 189 of the Act; or

(e) A director becomes of unsound mind.      

How to check certificate of incorporation in Kenya

  1.  Search for E Citizen platform on Google and Log In using your credentials and then click on to the Business Registration Service Link
  2.  Click on Make Application. You then are directed to a Page with 11 listed Services. Click on Service Number 10 written Official Search (Third Party Applications) and pop notify you that the service cost you KSH 650. Click on Apply Now, and you land on a page named Find a business.
  3.  Use the Company Name or Company registration Number to Search in the Space you have been Provided. Then the Company you have searched for appears. Click on the Particular Company Name and then click on Next.
  4. Put in your Postal Address and Postal Code and Click on Press and Continue.
  5. Confirm you have provided all the information required by the Registrar of Companies by Clicking on the checkbox and then click on finish.
  6. On the Payment page, Choose the payment mode which suits you and then Pay the KSH 650. Once you have successfully made the payment, Click on Confirm Payment. Once this is successful, you land on a page called application details, and here you can download Form Cr12 and here you receive all the Company details you require.

Certificate of incorporation Kenya sample

 

If you wish to register a company in Kenya, please contact us on [email protected] or [email protected], we will lead you through the entire process.

We provide professional and excellent services to our clients wishing to register a company in Kenya.

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