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
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,...