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requirements for registering a limited company in kenya

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Introduction

Registering a limited company in Kenya involves several legal requirements and procedures as stipulated in various Acts and regulations. The primary legal framework governing the registration and operation of companies in Kenya is the Companies Act, 2015. This Act outlines the necessary steps, documentation, and compliance requirements for establishing a limited company. Additionally, other relevant laws and regulations may come into play, such as the Business Registration Service Act, 2015, and the Income Tax Act, Cap 470.

Legal Framework
- Companies Act, 2015
- Business Registration Service Act, 2015
- Income Tax Act, Cap 470
Types of Limited Companies
- Private Limited Company
- Public Limited Company
Pre-Registration Requirements
- Name Search and Reservation
- Preparation of Memorandum and Articles of Association
- Appointment of Directors and Company Secretary
- Registered Office Address
Registration Process
- Submission of Application
- Payment of Registration Fees
- Issuance of Certificate of Incorporation
Post-Registration Requirements
- Tax Registration
- Business Permits and Licenses
- Compliance with Statutory Obligations
Conclusion

1. Legal Framework

Companies Act, 2015

The Companies Act, 2015 is the primary legislation governing the registration and operation of companies in Kenya. It provides comprehensive guidelines on the formation, management, and dissolution of companies.

Business Registration Service Act, 2015

This Act establishes the Business Registration Service, which is responsible for the administration of laws relating to the registration of companies, partnerships, and business names.

Income Tax Act, Cap 470

The Income Tax Act outlines the tax obligations of companies operating in Kenya, including the requirement to obtain a Personal Identification Number (PIN) from the Kenya Revenue Authority (KRA).

2. Types of Limited Companies

Private Limited Company

A private limited company is a type of company that restricts the right to transfer its shares and limits the number of its members to fifty. It is suitable for small to medium-sized businesses.

Public Limited Company

A public limited company can offer its shares to the public and has no restriction on the number of members. It is suitable for larger businesses that intend to raise capital from the public.

3. Pre-Registration Requirements

Name Search and Reservation

Source: Companies Act, 2015, Section 48
The first step in registering a limited company is to conduct a name search to ensure that the proposed company name is unique and not already in use.
The name search is conducted through the eCitizen portal, and if the name is available, it can be reserved for a period of 30 days.

Preparation of Memorandum and Articles of Association

Source: Companies Act, 2015, Sections 22 and 23
The Memorandum of Association outlines the company's objectives and the scope of its activities.
The Articles of Association detail the internal management structure and the rules governing the company's operations.
These documents must be prepared and signed by the initial subscribers (shareholders) of the company.

Appointment of Directors and Company Secretary

Source: Companies Act, 2015, Sections 129 and 244
A private limited company must have at least one director, while a public limited company must have at least two directors.
A company secretary is mandatory for public limited companies and optional for private limited companies.

Registered Office Address

Source: Companies Act, 2015, Section 50
The company must have a registered office address in Kenya where official documents and communications can be sent.

4. Registration Process

Submission of Application

Source: Companies Act, 2015, Section 13
The application for registration is submitted online through the eCitizen portal.
The following documents must be uploaded:
- Memorandum and Articles of Association
- Form CR1 (Application for Company Registration)
- Form CR2 (Model Memorandum for a Company with Share Capital)
- Form CR8 (Notice of Residential Address of Directors)

Payment of Registration Fees

Source: Companies Act, 2015, Section 14
The applicable registration fees must be paid online through the eCitizen portal.
The fees vary depending on the type and size of the company.

Issuance of Certificate of Incorporation

Source: Companies Act, 2015, Section 15
Upon successful submission and verification of the application, the Registrar of Companies issues a Certificate of Incorporation.
The certificate serves as conclusive evidence that the company is duly registered under the Companies Act, 2015.

5. Post-Registration Requirements

Tax Registration

Source: Income Tax Act, Cap 470, Section 12
The company must obtain a Personal Identification Number (PIN) from the Kenya Revenue Authority (KRA) for tax purposes.
The company is also required to register for Value Added Tax (VAT) if its annual turnover exceeds the prescribed threshold.

Business Permits and Licenses

Source: County Governments Act, 2012, Section 6
Depending on the nature of the business, the company may need to obtain various permits and licenses from the relevant county government and regulatory authorities.

Compliance with Statutory Obligations

Source: Companies Act, 2015, Sections 654 and 655
The company must comply with ongoing statutory obligations, including filing annual returns, maintaining proper accounting records, and holding annual general meetings.

Conclusion

Registering a limited company in Kenya involves a series of legal requirements and procedures as outlined in the Companies Act, 2015, and other relevant laws. By following the steps outlined above, prospective business owners can ensure that their company is duly registered and compliant with Kenyan law. This process not only legitimizes the business but also provides a solid foundation for its operations and growth.