THE PROCESS OF REGISTERING A COMPANY IN KENYA.
Incorporation is the process by which a new or existing business registers as a company.
A business cannot be registered as a company unless it has been incorporated and registered at the Companies Registry under the Companies Act, 2015.
WHO CAN INCORPORATE A COMPANY?
One or more legal persons (which includes individuals, companies, government owned entities, non-profit organizations and other legal persons excluding an unincorporated Trust) can form a company by subscribing their names to a memorandum of association.
TYPES OF COMPANIES IN KENYA
There are five types of companies as follows:
1. Private company limited by shares
This type of company has 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 general public and may not have more than fifty (50) members.
2. Unlimited company
This type of company has no limit on the liability of its members
3. 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 general public and may be listed at the securities exchange.
4. Company 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.
5. Foreign Companies
This type of a Company is a Branch of a Company registered outside of Kenya, that has established a place of business in Kenya.
Documents required to Register a company
To register a company the following documents should be lodged at the Companies Registry:
1. Company registration form (Form CR1)
2. Application for reservation of a company name (Form CR14)
3. Memorandum of association
4. Particulars of the directors and secretary (Form CR2and Form CR10)
5. Statement of nominal capital
6. Articles of association (however if model articles are adopted in entirety, there is no need for a copy to be lodged at the Companies Registry for filing).
7. Notification of the residential address of directors and company secretary (FormCR8 and CR12)
8. Copy of the Kenyan national identification of each director and secretary or, Copy of the Kenyan foreigner certificate, or in the case of a director who is not a Kenyan citizen and is not resident in Kenya, a copy of that director’s passport,
9. A passport-sized photograph of each director and the company secretary
Choosing a company name.
The incorporation of a Company is a one step, and one day process. It is important to note the following when choosing a company name (s);
1. A company name may not contain more than 160 characters.
2. The name of a limited company that is a private company must end with “Limited “or “Ltd”. The name of a limited company that is a public company incorporated under the2015 Act must end with “plc” or “Public Limited Company”.
3. Offensive or abusive words are not allowed either. Offensive words in vernacular (mother tongue) are not allowed either.
4. Political names
5. The name should not be identical to an already reserved name or to the name of an already registered company, business name, LLP, partnership. (Unless the existing company, business, LLP or partnership is part of the same group as the company and consents in writing to the use of the proposed name).
6. The name should not be the same as or similar to that of a registered trademark. (it may therefore be important to also conduct a search at the
trademarks registry)
7. Names containing the words “co-operative”, “society”, or “trade union” are not allowed (i) Numbers may be used in any part of a name
8. A full stop, comma, colon, semi-colon or hyphen may be used
9. The following punctuation marks may be used: an apostrophe (‘), brackets/parenthesis ( ), exclamation mark (!), Guillemet (<<>>), inverted comma, question mark, solidus (\ /)
10. The following signs and symbols may be used only if they are not one of the first three letters of a company name: *; =; #; % (m) The name should not
start with the words “Kenya” as the same is reserved for government owned entities.
Certificate of incorporation
The certificate of incorporation is conclusive evidence that the requirements of the Companies Act 2015 as to registration have been complied with and that the company is duly registered under the Act. The certificate will state:
1. The name and registration number of the company
2. The date of incorporation
3. Whether it’s a limited or unlimited company, and if limited whether it is limited by shares or by guarantee
4. Whether it is a private or public company
5. With a verifiable security feature.
The certificate of incorporation must be signed, sealed and authenticated by the Registrarof Companies.
Disclaimer
The information provided in this article is intended for general legal advice and does not constitute legal advice for any specific transaction or case as each transaction presents a unique legal context, it is advisable to retain a legal adviser for specific transactions.
To contact Benjamin Bogongo and associate advocates, send us an email at info@benjaminadvocates.com or call +254 793026449 or WhatsApp at your convenience. Our legal team consists of experienced lawyers in the company registration process in Kenya and will be happy to help you.