Company registration in Kenya. - All you need to know.

Registering a private limited company (LTD) in Kenya is a straightforward process thanks to the online eCitizen Business Registration Service (BRS) portal. This makes it easy for both Kenyan entrepreneurs and foreign investors to incorporate a company. A private limited company offers limited liability protection (meaning shareholders’ personal assets are protected from business debts) and grants the company a separate legal identity, allowing it to own property and enter contracts in its own name.

To get started, you’ll need to choose a unique company name, prepare the required documents (including IDs and tax PINs for all directors/shareholders), and submit an application through the eCitizen portal. In this guide, I’ll explain each step in detail, compare requirements for local versus foreign investors, outline costs and timelines, and highlight benefits, common pitfalls, and tips for a smooth registration process.

Company Types and Structures in Kenya

Kenya’s Companies Act recognizes several business entity types. The most common form for entrepreneurs is a private company limited by shares, where ownership is divided into shares held by members (maximum 50) and shares are not offered to the public. Other structures include:

  • Private Company Limited by Guarantee: Used mainly for nonprofits or charities, with members’ liability limited to a guarantee amount and no share capital.
  • Unlimited Company: A rarer form where members have no limit on their liability.
  • One-Person (Single-Member) Company: Introduced under the Companies Act 2015, allowing a sole entrepreneur to incorporate a private company as the sole shareholder and director.
  • Foreign Company: Under the Companies Act 2015, a company registered in a foreign jurisdiction can be registered in Kenya as a branch and issued a certificate of compliance.

For most businesses, a private limited company (by shares) is ideal, as it balances credibility with relatively simple compliance.

Requirements for Kenyan Residents

To register a private limited company in Kenya, local founders must meet several requirements:

  • Minimum Members/Directors: At least one director and one shareholder (they can be the same individual). Directors must be natural persons over 18 years of age.
  • Company Name: Propose at least 2–5 unique names (in order of preference) for approval. The name must not infringe trademarks, be obscene, or imply government affiliation.
  • Tax Identification (KRA PIN): All directors, shareholders, and beneficial owners must have active Kenya Revenue Authority (KRA) PINs. You can apply for PINs online via the KRA iTax portal before registration.
  • Contact Information: Provide a physical and postal address in Kenya for the registered office, plus valid email and telephone details.
  • Memorandum amp& Articles of Association: Prepare the company’s constitution. You can draft your own or use the model forms provided by the Registrar. These documents define the company’s objectives, share capital, and internal rules.
  • Other Details: Outline the shareholding structure and purpose of the business. Kenyan nationals simply supply a valid ID; foreign nationals (if involved) must provide a valid passport and any required permits.

Gather photocopies of all IDs, recent passport-sized photos, the KRA PIN certificates, and proof of address for each person. Having these ready will avoid delays during the online application.

Requirements for Foreigners

Foreign investors must meet the above requirements plus some additional conditions under Kenyan law:

  • Foreign Shareholding: Under current regulations, there are no direct restrictions on foreign nationals owning a Kenyan company. In practice, foreigners can own a company 100% where they have the appropriate immigration status. Otherwise, they may need to appoint a local director or a company secretary.
  • Local Representative/Director: A foreign-owned company needs at least one Kenyan representative (director) or the employment of a company secretary.
  • Documentation: If a foreign company is a shareholder in a Kenyan company, you must upload notarized copies of the parent company’s incorporation certificates and related documents as part of the application.

In summary, foreign entrepreneurs must ensure a Kenyan participates in ownership (or meets local representation requirements), obtain any necessary work/business permits for themselves, and submit all certified foreign company documents along with their application.

Step-by-Step Registration Procedure

The entire registration is handled through the eCitizen BRS portal (register at eCitizen.go.ke). Below is a typical sequence of steps to follow:

  1. Reserve and Approve Your Company Name: On eCitizen, start a Name Reservation for a private company by entering 3–5 proposed names in order of preference. The Registrar will review the suggestions and, if approved, reserve one name for your application. Tip: Avoid restricted words or names too similar to existing entities. Use the BRS search tool on the portal to check availability.
  2. Log in to eCitizen and Select Private Limited Company: If you don’t have an eCitizen account, create one (it’s free). After logging in, navigate to the Business Registration Service section and choose “Private Limited Company.”
  3. Fill in Company Details: Complete the online application form with the company’s details: the reserved name, registered office address, main business activities (objectives), and any special resolutions (if applicable).
  4. Enter Shareholders and Directors: List all shareholders and directors along with their addresses, nationalities, and share allocations. Upload digital copies of each person’s ID/Passport and their passport-sized photo. Ensure each person’s KRA PIN is entered correctly, as the portal will verify it. (Note: Each director or shareholder must consent to their appointment on the portal.)
  5. Specify Share Capital: Enter the company’s authorized (nominal) share capital. Kenyan law does not mandate a minimum capital. You could start with a low nominal amount (e.g. KSh 1,000) to meet formalities; future increases would require stamp duty at 1% on the added amount.
  6. Download and Sign Statutory Forms: After submitting the basic information, the portal will auto-generate forms you must sign. These typically include the Statement of Nominal Capital and the statutory forms (Form CR1, CR2, CR8, CR14) along with the Memorandum amp& Articles of Association (if not already consolidated). Print, sign, and stamp the forms as required (for example, the CR14 declaration must be signed by a practicing advocate with a stamp).
  7. Upload Signed Forms and Documents: Scan the signed Statement of Nominal Capital, Form CR1, CR2, CR8, CR14, and the Memorandum amp& Articles of Association into PDF format. Upload them back into the eCitizen application. Also attach each director/shareholder’s ID and photo, plus any required foreign company documents (if applicable).
  8. Review and Pay Fees: Carefully check all entered information for accuracy. Then pay the prescribed government fees through the portal.
  9. Await Incorporation Certificate: Once payment is made, the Registrar will process your application. The turnaround is usually 3–10 business days, and you can track progress on eCitizen. If any corrections are needed, you’ll be notified to update the application. Upon approval, the system will issue an electronic Certificate of Incorporation. Download and print this certificate – it is your legal proof that the company now exists.
  10. Post-Incorporation Steps: After incorporation, immediately register the company for a KRA PIN (the company needs a PIN separate from its shareholders’) and, if applicable, register for VAT or PAYE on the KRA iTax portal. Also ensure you file the first Annual Return (Form CR12) within a year of registration to stay compliant. If you plan to trade immediately, obtain the required county business permit and any sector-specific licenses.

Costs of Company Registration in Kenya

The standard fee for a private limited company is KSh 10,650 (roughly USD 70–80), which covers,

  1. Name reservation.
  2. Company registration.
Some guides note the total is about KSh 10,750–10,850 including minor convenience charges (there is no stamp duty on share capital at incorporation).

Other costs

  • Stamp Duty: There is no stamp duty on authorized share capital at incorporation. (Stamp duty of 1% applies only on future increases of share capital or share transfers.)
  • Additional Services: If you use a professional firm or company secretary, budget for their service fees (often KSh 5,000–20,000 depending on complexity).
  • Exchange Rate: At current rates, the registration fee (~KSh 10,650) is roughly $75 USD.

How long is the company registration process in Kenya?

  • Name Reservation: Typically instant or within 2 days on eCitizen.
  • Company Registration: Once all documents are submitted, the Registrar issues the Certificate of Incorporation in about 5 business days. In practice, companies often complete registration within one working week.

Benefits of Registering a Private Limited Company

  • Limited Liability Protection: Shareholders’ personal assets (homes, savings) are protected from company debts and liabilities.
  • Separate Legal Entity: The company can own property, sue or be sued, and enter contracts in its own name. This continuity survives changes in ownership or management.
  • Enhanced Credibility: Registered companies appear more professional to customers, suppliers, and partners. This can make it easier to win contracts and raise capital.
  • Easier Financing: It is simpler to bring in investors or take loans, since shares can be issued or transferred (subject to the 50-member limit). Investors often prefer a company structure.
  • Perpetual Succession: The company continues even if ownership changes or owners die, unlike sole proprietorships or partnerships.
  • Access to Opportunities: A registered company is eligible to bid for government tenders, join trade associations, and access certain business incentives.
  • Tax Advantages: Companies in Kenya are subject to corporate tax (currently 30%), but they may benefit from certain deductions and lower overall tax rates compared to individuals. Also, business losses can be carried forward under the tax laws.

These benefits make a private company a popular choice for serious businesses. For foreign investors, forming a Kenyan company demonstrates commitment to the market and may ease negotiations with local partners or banks.

Common Mistakes to Avoid

  • Skipping Thorough Name Search: Proposing only one name or using a name similar to an existing business can lead to instant rejection. Always provide multiple unique options and search via the official BRS portal to avoid conflicts. Avoid banned or politically-sensitive words.
  • Incomplete or Incorrect Documentation: Failing to include all required forms or leaving fields blank can stall your application. For example, forgetting to upload a director’s KRA PIN or passport photo will cause rejection. Double-check that you have scanned legible copies of each ID, a signed CR14, and accurate details on each form.
  • Not Registering KRA PINs: Each director/shareholder must have a KRA PIN before approval. Sometimes applicants overlook obtaining PINs for family members or foreign directors; this alone will block registration. Apply for PINs on KRA iTax ahead of time.
  • Improper Uploads: The portal requires specific file formats. Upload scanned documents in PDF format (for forms) and JPEG/PNG for photos. Large or unclear scans can be rejected. Ensure each uploaded file is complete and under any size limit.
  • Using Sole Proprietorship Mistakenly: Some entrepreneurs begin operating under a sole proprietorship or business name and then try to “convert” without proper cessation forms. It’s usually simpler to incorporate a new company from scratch on eCitizen. Conversions involve extra forms (CR forms 15–19) and fees.
  • Neglecting Regulatory Compliance: Registering the company is just the first step. Entrepreneurs often forget to register for other requirements (getting a business permit from the county, applicable sector licenses, or joining the NHIF/NSSF schemes for employees). Ignoring these can lead to fines. Also, remember to submit annual returns (Form CR12) each year to avoid penalties.
  • Misunderstanding Foreign Rules: Foreign investors sometimes miss the local representative requirement. Before registration, plan how you will meet these conditions (such as appointing a local director or secretary).

Avoiding these pitfalls ensures your application isn’t delayed or rejected. For example, engaging a lawyer or company secretary to review your documents can prevent errors and streamline the process.

Tips for a Smooth Registration Process

  • Prepare in Advance: Assemble all documents (IDs, PINs, addresses, Memorandum amp& Articles) before logging into eCitizen. Have passport photos and KRA PIN certificates at hand. This minimizes time-consuming back-and-forth.
  • Use the Official BRS/eCitizen Portal: Always conduct the name search and registration on the BRS portal (via eCitizen) to ensure compliance. Third-party sites may not reflect the latest availability or fee structure.
  • Propose Multiple Name Options: Have at least three distinct company names ready. This is a requirement of the Registrar. If your first choice is taken, the system will automatically try the next.
  • Double-Check Your Entries: Verify spelling of names, addresses, and KRA PINs. Typos in company names or personal details can invalidate the forms.
  • Follow Signing Instructions: Some forms (like the CR14 statutory declaration) must be signed by a practicing advocate with an official stamp. Print and sign exactly as directed. Keep originals as you may need them later.
  • Monitor Your Application: After submission, regularly check the eCitizen dashboard or your email for any feedback. Respond promptly to correction requests to avoid delays.
  • Stay Organized: Keep digital and physical copies of every submitted form and fee receipt. This will help when opening bank accounts or for future compliance.
  • Seek Professional Help if Needed: If you’re uncertain, consider hiring a company secretary or legal advisor. They can ensure all requirements are met and often expedite the process. This is especially helpful for complex cases (e.g. foreign ownership or large share structures).
  • Plan Post-Registration Steps: Once incorporated, obtain the company’s KRA PIN immediately and open a business bank account. Also register for VAT if your turnover will exceed the threshold.

By staying organized and thorough, you’ll make the registration process fast and hassle-free. Kenyan entrepreneurs and foreign investors alike benefit from following these best practices when registering a company in Kenya.