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requirements for registering a limited company in kenya

M-Wakili's Response

To register a limited company in Kenya, you must meet certain requirements as outlined in the Companies Act, 2015. These requirements are crucial for ensuring the legitimacy and smooth operation of your company.

Table of Contents

  1. Choosing the Right Company Structure

  2. Name Reservation

  3. Preparation of Required Documents

  4. Company Incorporation

  5. Tax Registration

  6. Opening a Bank Account

  7. Employing Staff (Optional)

  8. Case Laws

1. Choosing the Right Company Structure

The first step is to determine the most suitable company structure for your business. In Kenya, there are several options, each with its own advantages and disadvantages:

  • Private Limited Company: This is the most common type of company in Kenya. It is a separate legal entity from its owners, offering limited liability protection. This means that the personal assets of the owners are protected from the company's debts.

  • Public Limited Company: This type of company can raise capital from the public through the issuance of shares. It is subject to more stringent regulations than a private limited company.

  • Company Limited by Guarantee: This type of company is typically used for non-profit organizations. It is not owned by shareholders but by members who guarantee a certain amount of money to cover the company's debts.

  • Limited Liability Partnership (LLP): This structure combines the features of a partnership and a company. It offers limited liability protection to the partners, but it is not a separate legal entity.

2. Name Reservation

Once you have chosen the company structure, you need to reserve a unique name for your company. This can be done online through the eCitizen portal. The name must not be similar to any existing company name and must comply with the requirements of the Companies Act, 2015.

3. Preparation of Required Documents

The next step is to prepare the necessary documents for company registration. These documents include:

  • Memorandum and Articles of Association: These documents outline the company's objectives, powers, and internal governance structure.

  • Certificate of Incorporation: This document confirms that the company has been registered with the Registrar of Companies.

  • Certificate of Good Standing: This document confirms that the company is in good standing with the Registrar of Companies.

  • Tax Identification Number (PIN): This number is required for tax purposes and can be obtained from the Kenya Revenue Authority (KRA).

  • National Social Security Fund (NSSF) Card: This card is required for all employees of the company.

  • National Hospital Insurance Fund (NHIF) Membership: This membership is required for all employees of the company.

  • Registered Office Address: The company must have a registered office address in Kenya.

  • Details of Directors and Shareholders: The names, addresses, and other details of the company's directors and shareholders must be provided.

  • Company Secretary: The company must appoint a company secretary who is responsible for ensuring compliance with the Companies Act, 2015.

4. Company Incorporation

Once all the required documents have been prepared, you can submit them to the Registrar of Companies for incorporation. The Registrar will review the documents and, if they are in order, issue a Certificate of Incorporation.

5. Tax Registration

After incorporation, you need to register your company with the KRA for tax purposes. This involves obtaining a PIN and complying with all relevant tax laws.

6. Opening a Bank Account

You will need to open a bank account for your company. This will allow you to receive payments and make transactions on behalf of the company.

7. Employing Staff (Optional)

If you plan to employ staff, you will need to comply with all relevant labor laws. This includes registering with the NSSF and NHIF and providing employees with the required benefits.

8. Case Laws

  • Kamlesh Mansukhlal Damji Pattni v Nasir Ibrahim Ali, Dinky International Sa & World Duty Free Company Limited (Civil Appli 354 of 2004): This case involved a dispute over the ownership of a company. The Court of Appeal held that the company's articles of association should be interpreted in accordance with the intention of the parties.

  • Canuk Holdings Limited v Lutta t/a Lutta & Company Advocates & 2 others; Tuitoek (Objector) (Civil Case E822 of 2010): This case involved a dispute over the appointment of a company secretary. The High Court held that the appointment of a company secretary must comply with the requirements of the Companies Act, 2015.

  • Katendeigwa v D.Light Limited (Employment and Labour Relations Cause 770 of 2019): This case involved a dispute over the termination of an employee's contract. The Employment and Labour Relations Court held that the termination of an employee's contract must be fair and in accordance with the law.

TLDR

To register a limited company in Kenya, you need to choose the right company structure, reserve a unique name, prepare the required documents, submit them to the Registrar of Companies for incorporation, register with the KRA for tax purposes, open a bank account, and comply with all relevant labor laws if you plan to employ staff.

Conclusion

Registering a limited company in Kenya is a relatively straightforward process. However, it is important to understand the requirements and comply with all relevant laws. By following the steps outlined above, you can ensure that your company is registered correctly and is able to operate legally in Kenya.

Sources:

Answered by mwakili.com