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[ESTABLISHING A BUSINESS ENTITY IN KENYA]
The Act differentiates between a foreign investor and a local investor, where a foreign investor is defined as: i. A natural person who is not a citizen of Kenya ii. A partnership in which a non-Kenyan owns the controlling interest iii. A company incorporated under the laws of another country other than Kenya A foreigner desiring to engage in investment activities within the territorial bounds of Kenya is obliged to apply for an Investment Certificate to the Kenya Investment Authority. The issuance of this certificate is contingent upon the foreign investor committing to invest a minimum sum of at least one hundred thousand United States Dollars (USD 100,000), or its equivalent in Kenyan Shillings or any other recognised currency. Additionally, it is incumbent on a local investor to inject a minimum of one million Kenyan Shillings (KSH 1,000,000), or its equivalent in another currency, into the proposed investment endeavour. Furthermore, it is imperative that the envisaged investment complies with prevailing legal standards and is demonstrably advantageous to the Republic of Kenya. To substantiate the aforementioned "beneficial to Kenya" criterion, a confluence of prerequisites must be met, as expounded within Section 4 of the Investment Promotion Act. This includes, but is not limited to, the creation of gainful employment opportunities for Kenyan nationals, the infusion of revenue into the national exchequer through taxation, the utilization of locally sourced raw materials and services, the transfer of technological knowledge to Kenya, and the augmentation of foreign exchange reserves, among other criteria.
Upon successful acquisition of a valid Investment Certificate, the investor shall be accorded the privilege of obtaining certain licenses requisite for the lawful operation of the business enterprise. The issuance of these licenses is expressly conditional upon the investor's prompt settlement of the prescribed fees within six months from the date of receipt of the investment certificate. The licenses to which an investor shall be entitled upon receipt of the Investment Certificate include: (These are contained in the Second Schedule of the Investment Promotion Act) 1. Registration under the Industrial Registration Act (Cap. 118). Condition: That the registrable particulars be submitted within six months after the issue of the investment certificate. 2. License, including a conditional license, under the Trade Licensing Act (Cap. 497). 3. Import license or export license under the Imports, Exports and Essential Supplies Act (Cap. 502). 4. Registration of premises as a factory under the Factories Act (Cap. 514). 5. Approval of plans under section 69G of the Factories Act (Cap. 514). 6. Development permission under section 33 of the Physical Planning Act, 1996 (No. 6 of 1996) and a certificate of compliance referred to in section 30(7) of that Act. 7. Registration under an order under the Industrial Training Act (Cap. 237). Pursuant to the provisions delineated within the Land Control Act Cap 302 , it is expressly stipulated that consent for the disposition of land or shares, through means such as sale, transfer, lease, exchange, or partition, to a
ILN Corporate Group – Establishing a Business Entity Series
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