Doing business in Kenya

Kenya's legal system is based on English common law, statute and the Constitution of Kenya 2010, which created a national government and 47 county governments. Companies are formed under the Companies Act 2015 through the Business Registration Service; national taxes and customs are collected by the Kenya Revenue Authority; the Central Bank of Kenya regulates banks and payments; the Competition Authority of Kenya reviews mergers; and the Office of the Data Protection Commissioner enforces data protection law. Counties levy their own business permits and fees alongside national taxes.

Key facts

Corporate income tax

30% for resident companies and branches (as at mid-2026)

VAT

Standard rate 16%; fuel 8% (as at mid-2026)

Main entity form

Private company limited by shares; registered branch for foreign companies

Foreign ownership

Generally permitted, with ownership limits in some regulated sectors

Data protection

Data Protection Act 2019; Office of the Data Protection Commissioner

New York Convention

Party since 1989

Annual leave

At least 21 working days after 12 months of service

This topic was written by AI from general knowledge and is being checked against official sources. Confirm anything you plan to rely on with a qualified local professional.

1 statement on rates, thresholds or deadlines is held back until it is checked against an official source.

Most foreign investors set up a private company limited by shares or register their foreign company as a branch with the Business Registration Service. Ownership is generally open to foreigners, but some regulated sectors carry local ownership requirements, and beneficial ownership information must be filed with the Registrar.

Key facts

• Registration is handled online through the Business Registration Service on eCitizen, so plan for digital filings and local identity details for officers.

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• Check sector laws early: ownership is generally open, but some licensed sectors require Kenyan shareholders.

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• Beneficial ownership information is a filing obligation, so group structure changes abroad can require Kenyan updates.

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Who handles this in KenyaSetting up and running a companyContracts and commercial law · James Ngochi NgugiLicences, permits and regulators

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Key facts

• Plan on a 30% corporate rate for a Kenyan subsidiary and 16% VAT on most supplies.

• Payments to non-residents attract withholding tax at 15% on dividends and interest and 20% on royalties and management or professional fees, before any treaty relief, so check the treaty position before contracting.

• Set up eTIMS invoicing from day one: since January 2024, business expenses not backed by an eTIMS invoice are not deductible for income tax.

Who handles this in KenyaTax and structuring · Farheen KhandwallaAccounting and annual filings · Farheen KhandwallaAudit · Abdul Bagha

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Key facts

• Statutory payroll deductions include PAYE, NSSF (6% each from employer and employee within earnings limits), SHIF (2.75% of the employee's gross salary) and the housing levy (1.5% each from employer and employee).

• Leave entitlements start at 21 working days a year, with separate maternity and paternity leave.

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Foreigners can hold land only on leasehold.

Key facts

• Export processing zone and special economic zone enterprises pay reduced corporate tax rates for up to 20 years if the zone conditions are met; check customs treatment separately.

• Government tenders favour local suppliers in several categories, which affects bid strategy.

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Who handles this in KenyaLicences, permits and regulatorsContracts and commercial law · James Ngochi NgugiTax and structuring · Farheen Khandwalla

This topic was written by AI from general knowledge and is being checked against official sources. Confirm anything you plan to rely on with a qualified local professional.

2 statements on rates, thresholds or deadlines are held back until they are checked against an official source.

Kenya has no general exchange controls, so capital, profits and dividends can usually be moved abroad through commercial banks once tax is paid. Banks are supervised by the Central Bank of Kenya and apply customer due diligence under the anti-money laundering law. Mobile money is widely used for payments.

Key facts

• Expect thorough onboarding: banks verify directors, shareholders and beneficial owners.

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Who handles this in KenyaPayments and currencyBanking and capitalAnti-bribery, sanctions and complianceTreasury and funding

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Kenya is part of the East African Community Customs Union and applies its common external tariff to imports from outside the bloc. It also belongs to COMESA and the African Continental Free Trade Area, and many imported products need a certificate of conformity from the Kenya Bureau of Standards' pre-export verification programme.

Key facts

• Imports from outside the EAC pay the common external tariff; goods moving within the EAC can qualify for duty-free treatment if origin rules are met.

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• Check whether your products need a pre-export certificate of conformity, as shipments without one can be delayed or penalised.

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• Regional and bilateral agreements, including AfCFTA and the EU agreement, can reduce duties if rules of origin are satisfied.

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• The Kenya Revenue Authority runs customs alongside domestic taxes, so customs and VAT records should reconcile.

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Who handles this in KenyaCustoms, trade and export controlsTax and structuring · Farheen KhandwallaLicences, permits and regulators

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Key facts

• Check whether your business must register as a controller or processor: registration is required unless the business is below KES 5 million turnover and has fewer than 10 employees, and is always required in listed sectors such as financial services, health, education and telecoms.

• Group data sharing and cloud hosting abroad need a documented transfer basis, such as binding corporate rules or the ODPC's standard contractual clauses.

Who handles this in KenyaData protection and cyberContracts and commercial law · James Ngochi NgugiAnti-bribery, sanctions and compliance

The Kenya Industrial Property Institute is the industrial property office and the Kenya Copyright Board the copyright office. Kenya belongs to the Paris Convention, the PCT, the Madrid Protocol and ARIPO, and a statutory anti-counterfeit body acts against counterfeit goods.

Key facts

• Register trademarks in Kenya early, either nationally, through the Madrid system or through ARIPO.

• Patent protection can be sought through a PCT national phase or an ARIPO filing designating Kenya.

• The anti-counterfeit body can act against counterfeit goods, with seizure, destruction and criminal penalties, so register marks in Kenya before relying on enforcement.

• Copyright matters sit with the Kenya Copyright Board under the Copyright Act 2001; check whether registering key works is available and useful as evidence.

Who handles this in KenyaTrade marks, patents and brandsContracts and commercial law · James Ngochi Ngugi

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Acquisitions of control of listed companies follow the Capital Markets (Take-Overs and Mergers) Regulations, and insolvency is governed by the Insolvency Act 2015.

Key facts

• Check Kenyan merger thresholds early: implementing a notifiable merger before approval is an offence and can attract a penalty of up to 10% of Kenyan turnover.

• Assess COMESA notification in parallel for deals with operations in several member states.

• Change of control in a licensed business needs the sector regulator's consent; for example, the Central Bank of Kenya must approve transfers of more than 5% of a bank's shares.

• Administration under the Insolvency Act 2015 offers a rescue route before liquidation.

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Who handles this in KenyaBuying, selling and investingContracts and commercial law · James Ngochi NgugiLicences, permits and regulators

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Kenya's Bribery Act 2016 applies to private businesses and expects them to have procedures to prevent bribery. Money laundering is addressed by the Proceeds of Crime and Anti-Money Laundering Act, and Kenya has been under increased FATF monitoring since February 2024, which raises due diligence expectations.

Key facts

• Adopt documented anti-bribery procedures: the Bribery Act 2016 expects them of private companies.

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• The Bribery Act 2016 also places a duty to report knowledge or suspicion of bribery, so train managers accordingly.

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• Expect enhanced due diligence from banks and counterparties linked to FATF monitoring.

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Commercial disputes are heard in the High Court, which has a Commercial and Tax Division, with appeals to the Court of Appeal and Supreme Court. Arbitration is governed by the Arbitration Act 1995, Nairobi has a statutory international arbitration centre, and Kenya is a party to the New York Convention.

Key facts

• Arbitration with a Nairobi or neutral seat is common in cross-border contracts, and awards made in other New York Convention states are enforceable in Kenya.

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• Foreign judgments are easier to enforce if the country is designated under the reciprocal enforcement law; otherwise plan for arbitration.

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• Expect courts to refer some cases to mediation before trial.

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Who handles this in KenyaDisputes and arbitration · James Ngochi NgugiContracts and commercial law · James Ngochi Ngugi