Kenya’s corporate overhaul causes confusion

Author: Lizzie Meager | Published: 3 Nov 2015

A suite of new corporate laws in Kenya have caused confusion among local market participants. The new legislation, including an updated Companies Act and inaugural Insolvency Act, is a step forward, but contains glaring inconsistencies.

Lawyers are also not sure when they take effect, including whether there will be a grace period allowing for gradual compliance.

Both the Insolvency Act and Companies Act were assented by the President in September, but to date have not been fully implemented. Plus, much of the secondary legislation providing further guidance has not yet been released.

"This is welcome legislation, as until now we were operating under a very old statute from the UK," said Sonal Sejpal, director at Anjarwalla & Khanna in Nairobi. "But lawyers are still grappling with the understanding – we’ve assigned about 10 teams to the task." The Companies Bill, which has borrowed heavily from the UK’s Companies Act 2006,...