Business structures available in Kenya

Kenya offers several legal structures for carrying on business. Choosing the right one depends on the number of owners, the degree of personal liability you are willing to accept, the nature of the activity, and the regulatory environment that applies to your sector. The Companies Act, 2015 governs companies; other structures such as sole proprietorships, partnerships and limited liability partnerships are regulated under separate legislation.

Structure	Min. owners	Liability	Best suited for
Private Limited Company (Ltd)	1 shareholder (max 50)	Limited to unpaid share capital	Startups, SMEs, subsidiaries, joint ventures
Public Limited Company (Plc)	7 shareholders (no maximum)	Limited to unpaid share capital	Large companies intending to raise capital from the public or list on the Nairobi Securities Exchange
Sole Proprietorship	1 owner	Unlimited personal liability	Individual traders with low risk profiles
General Partnership	2 partners	Unlimited joint and several liability	Small professional firms; less common since the LLP became available
Limited Liability Partnership (LLP)	2 partners	Partners’ personal liability is limited	Professional services firms (lawyers, accountants)
Branch of a Foreign Company	N/A — parent company is the legal person	The foreign parent company is liable	Multinationals and international NGOs establishing a presence in Kenya

Private limited company: the preferred vehicle

For the vast majority of commercial ventures in Kenya — from tech startups to real estate holding structures to subsidiaries of multinational groups — the private limited company is the vehicle of choice. Its defining characteristics under the Companies Act, 2015 are: shares are not offered to the public; there must be between one and 50 shareholders; there must be at least one director who is a natural person; and the company name must end in “Limited” or “Ltd”. Shareholders’ liability is limited to the amount unpaid on their shares, which means personal assets are ring-fenced from business obligations. This structure is also the most straightforward to finance, to add investors to, and to use as part of a group holding structure. If you are considering holding land or other assets in a company rather than directly, see our note on stamp duty on property transactions in Kenya, which affects how assets are transferred into or out of a company.

Sole proprietorship and partnership

A sole proprietorship is the simplest form of business — an individual trades in their own name or under a registered business name. There is no separation between the owner and the business: the owner is personally liable for all debts and obligations. A general partnership follows the same logic but with two or more individuals sharing ownership and liability. Both are registered as business names with the BRS and attract lower fees than a company, but they offer no liability protection and typically cannot access institutional finance. Many sole traders and small partnerships later convert to a private limited company as the business grows.

Limited liability partnership (LLP)

The LLP is a hybrid structure that gives partners limited liability while retaining the flexible internal governance of a partnership. It is particularly popular with professional services firms. An LLP must have a minimum of two partners, must be registered with the BRS, and is governed by an LLP agreement rather than articles of association. Unlike a general partnership, no partner in an LLP is personally liable for the negligence or misconduct of another partner beyond their agreed contribution to the LLP. If you are considering an LLP for a professional services firm and want to structure ownership across generations or plan succession, the interaction with a family trust or other holding structure is worth examining early.

How to register a business in Kenya: step by step

Since 2017, all company registrations in Kenya have been processed online through the eCitizen portal. The process is managed by the Business Registration Service (BRS), established under the Business Registration Service Act, 2015, and supervised by the Registrar of Companies. The steps below apply to a private limited company, which is the most common registration type.

Step 1: Create an eCitizen account

Every applicant must have a verified eCitizen account. Kenyan citizens register using their national ID number; non-citizens use a passport number. The account must be verified before any BRS application can be submitted. If you are using an advocate to handle the registration, the application will typically be submitted through the firm’s own eCitizen account linked to the client’s details.

Step 2: Reserve a company name

Before incorporation can begin, the proposed company name must be reserved through the BRS portal on eCitizen. The name must not be identical or confusingly similar to an existing registered name, must not be offensive or contrary to public policy, and must end in “Limited” or “Ltd” for a private company. The government fee for name reservation is KES 150. Approval typically takes one working day. Once approved, the name is held for 30 days. If incorporation is not completed within that period, the reservation lapses and the name must be reserved again.

Step 3: Prepare the incorporation documents

The core documents required for incorporation of a private limited company are:

• Memorandum and Articles of Association — the constitutional documents of the company, setting out its objects (if any are stated), the rights attaching to shares, and the rules for managing the company. The Companies Act, 2015 provides model articles which apply by default if no bespoke articles are filed, but most companies file customised articles suited to their specific governance needs.
• Statement of Nominal Capital — the total authorised share capital and the classes of shares to be issued.
• Statement of the first directors — names, national ID or passport numbers, and addresses of all proposed directors. At least one director must be a natural person; corporate directors are permitted alongside at least one human director.
• Statement of the first shareholders — names, addresses and the number of shares to be taken by each subscriber.
• Registered office address — the physical address in Kenya at which the company’s statutory records will be held and to which official communications may be sent.

All documents are uploaded through the BRS module of the eCitizen portal. Physical documents are not submitted to the registry, though the originals should be retained by the company.

Step 4: Pay the government fees and submit

Once all documents are uploaded and checked, the application is submitted electronically. The BRS government fee for incorporating a private limited company is KES 10,650. Payment is made through the eCitizen payment gateway using M-Pesa, debit card or bank transfer. Once payment is confirmed, the application is queued for review by the registry.

Step 5: Receive the Certificate of Incorporation

If the application is in order, the Registrar issues a Certificate of Incorporation electronically via the eCitizen portal. This is the definitive proof of the company’s legal existence. The certificate states the company name, registration number, and date of incorporation. A certified copy of the certificate and the memorandum and articles may be downloaded from the portal for an additional fee. Incorporation typically takes three to five working days from submission of a complete application, though more complex applications or those requiring queries may take longer.

Step 6: Post-incorporation filings

Immediately after incorporation, the company should update the registry with the particulars of any additional directors appointed after the date of incorporation, the allotment of shares (if shares are issued beyond those taken by the subscribers), and the details of the company secretary (mandatory for all companies). These are filed through the BRS portal and attract separate filing fees. Failure to make required statutory filings is an offence under the Companies Act, 2015 and can result in fines for the company and its directors.

Registering a foreign company branch in Kenya

A foreign company that establishes a place of business in Kenya is required to register with the Registrar of Companies within 30 days of doing so, under section 974 of the Companies Act, 2015. Failure to register within this period is an offence, and the foreign company and every officer or agent of it who is in default may be liable to a fine for each day the default continues.

What counts as “establishing a place of business”

The Companies Act defines a place of business broadly. It includes a share transfer office, a share registration office, or a place from which contracts are regularly concluded or orders are regularly received in Kenya. If a foreign company appoints an agent who habitually exercises authority to conclude contracts on its behalf in Kenya, that will typically be treated as the foreign company having established a place of business. International groups should take advice before commencing operations in Kenya to establish whether registration is required.

Documents required for branch registration

To register a branch, the foreign company must submit through the BRS portal:

• Certified copies of the foreign company’s constitutional documents (memorandum and articles, charter, statute or equivalent), certified as correct by the appropriate authority in the company’s country of incorporation.
• A list of the directors and secretary of the foreign company (or their equivalents under the law of the country of incorporation).
• The name and address of one or more persons resident in Kenya authorised to accept service of process and notices on behalf of the company — the local agent.
• The address of the principal place of business in Kenya.

Documents in a language other than English must be accompanied by a certified English translation. The branch does not have separate legal personality from the foreign parent company: the parent remains the legal entity, and its liability extends to the Kenyan operations.

Ongoing obligations of a registered branch

A registered foreign company must file with the BRS a copy of its audited accounts (or, if it does not produce accounts under its home law, accounts that give a true and fair view of its affairs) annually. It must also notify the BRS of any changes in its directors, constitutional documents, or registered address. The branch must maintain a registered office address in Kenya at all times. Where a foreign company also intends to acquire or hold land in Kenya, additional considerations under the Land Act, 2012 and the relevant county planning laws apply.

Beneficial ownership requirements

The Finance Act 2023 amended the Companies Act, 2015 to introduce mandatory beneficial ownership disclosure for all companies registered in Kenya. This brought Kenya into line with the Financial Action Task Force (FATF) recommendations on corporate transparency and anti-money laundering.

What is a beneficial owner?

A beneficial owner is a natural person who ultimately owns or controls a company. The Companies Act, 2015 (as amended) defines a beneficial owner as any individual who directly or indirectly holds 10% or more of the shares or voting rights in a company, or who otherwise exercises control over the management of the company. Beneficial ownership looks through the legal structure to identify the human beings who ultimately benefit from and control a company.

The register of beneficial owners

Every company incorporated in Kenya must maintain an up-to-date register of beneficial owners. The register must record, for each beneficial owner: full name, national ID or passport number, nationality, date of birth, residential address, and the nature and extent of the beneficial interest held. The register must be kept at the company’s registered office and must be updated within 14 days of any change. The contents of the register are not publicly available, but the BRS has access for regulatory and law enforcement purposes.

Filing with BRS

The beneficial ownership register must be filed with the BRS through the eCitizen portal. A company that fails to maintain the register, or that files a register that is false or misleading, commits an offence under the Companies Act, 2015. The directors of the company are personally liable for ensuring compliance. Where a company is part of a group or where shares are held through layers of holding companies — including structures that might involve a trust or offshore entity — the analysis of who qualifies as a beneficial owner can be complex and requires careful legal advice.

After registration: KRA PIN, business permits and ongoing compliance

Obtaining a Certificate of Incorporation from BRS is the beginning, not the end, of the process of establishing a company in Kenya. Before the company can enter into commercial contracts, open a bank account or employ staff, several further registrations are required.

KRA PIN registration

Every company must obtain a Kenya Revenue Authority (KRA) Personal Identification Number (PIN) after incorporation. The PIN is used for all tax filings and is required by banks before they will open a corporate account. KRA PIN registration is done through the iTax portal (also accessed via eCitizen) and is normally completed on the same day. The company will also need to register for the relevant taxes — VAT if the projected annual turnover will exceed the registration threshold, PAYE if the company will have employees, and corporation tax in all cases. Failure to register for the applicable taxes or to file returns and pay tax on time attracts interest and penalties.

County business permit

Every business that operates from a physical location in Kenya requires a business permit (sometimes called a single business permit or trading licence) issued by the relevant county government. The requirement flows from the County Governments Act, 2012 and equivalent county legislation. The permit must be renewed annually. Fees vary significantly by county and by the type and scale of the business: a small retail trader in a rural county may pay a few thousand shillings, while a large manufacturer or financial institution in Nairobi or Mombasa may pay several hundred thousand shillings. The county will typically require sight of the Certificate of Incorporation and the KRA PIN before issuing the permit. Trading without a valid business permit exposes the business to closure by county enforcement officers.

Sector-specific licences

Certain sectors require additional licences from the relevant national regulator before business can commence. Examples include: the Capital Markets Authority for investment managers and stockbrokers; the Central Bank of Kenya for banks, forex bureaux and payment service providers; the Communications Authority for telecommunications companies; the Kenya Medical Practitioners and Dentists Council for healthcare providers; and the National Environment Management Authority for businesses with environmental impact. These sector licences are separate from, and must be obtained in addition to, the BRS Certificate of Incorporation and the county business permit. The time and cost of obtaining sector licences varies widely and should be factored into the timeline for launching the business.

Summary of post-incorporation steps and timelines

Step	Where	Typical timeline	Notes
Name reservation	eCitizen — BRS	1 working day	KES 150; valid for 30 days
Certificate of Incorporation	eCitizen — BRS	3–5 working days	KES 10,650 government fee for a private company
KRA PIN registration	eCitizen — iTax	Same day	Also register for VAT, PAYE as applicable
Beneficial ownership register filed with BRS	eCitizen — BRS	Within 14 days of incorporation	Finance Act 2023 requirement; 10% threshold
County business permit	Relevant county government	Varies — 1 to 4 weeks	Annual renewal; fee varies by county and business type
Corporate bank account	Bank of choice	1–3 weeks	Banks require Certificate of Incorporation, KRA PIN, directors’ IDs and KYC documentation
Sector-specific licence (if applicable)	Relevant regulator	Weeks to months	Varies significantly by sector and regulator

Common problems and how to avoid them

Name rejection

The most common early stumbling block is name rejection by the BRS. A name is rejected if it is identical or confusingly similar to an existing registered name, if it implies a connection to the government or a public body without permission, if it contains restricted words (such as “Bank”, “Insurance” or “National”) without the relevant regulator’s consent, or if it is offensive. Avoid overly generic names and research the BRS register before applying. Reserving two or three alternative names in order of preference reduces delay.

Incomplete or inconsistent documents

Applications are rejected or queried when information in the uploaded documents does not match across forms — for example, a director’s name spelled differently in the articles and the directors’ statement, or an address that does not match the ID document. Review all documents carefully before submission. Each query and resubmission adds working days to the process.

Failure to appoint a company secretary

Every company must have a company secretary. The Companies Act, 2015 requires the particulars of the company secretary to be filed with the BRS. For a public company, the secretary must have prescribed qualifications. For a private company, any person who has the necessary knowledge and experience may be appointed. Failing to appoint a secretary or to file the appointment is an offence and can prevent the company from maintaining its good standing with the registry.

Operating without a county business permit

Many companies commence trading immediately after receiving the Certificate of Incorporation without obtaining the county business permit, incorrectly treating the BRS certificate as sufficient authority to operate. The county permit is a separate requirement and its absence can result in the business being shut down by county enforcement officers, even if all national-level registrations are in order.

Neglecting annual returns

A company must file annual returns with the BRS each year within 60 days of its anniversary of incorporation. Annual returns confirm that the company’s registered particulars (directors, shareholders, registered office, share capital) are up to date. Filing late attracts a penalty. Persistent failure to file can result in the company being struck off the register, which terminates its legal existence and can have serious consequences for any property it holds. A company struck off the register can apply to be restored, but the process is time-consuming and expensive.

Missing the beneficial ownership deadline

The Finance Act 2023 requirement to maintain and file a beneficial ownership register with BRS is often overlooked by newly incorporated companies. The obligation arises from the date of incorporation, not from any separate notice by the BRS. Companies that hold complex group structures — including those using offshore holding companies or trusts for asset planning — should take legal advice early on how to comply with the 10% threshold rule across all layers of the structure.

How OLM Law can help

OLM Law Advocates LLP advises founders, investors and corporate groups on all aspects of business registration and corporate structuring in Kenya. Our Corporate & Commercial and Corporate Governance practices handle company incorporations, branch registrations, LLP formations and the full suite of post-incorporation compliance, including company secretarial services, annual returns, and beneficial ownership filings.

We regularly advise on structuring questions that go beyond the registration itself — whether to hold shares through a trust or a holding company, how to structure equity for a joint venture, or how to plan for eventual succession in a family business. Where registration involves acquiring property or assets, we coordinate the corporate and property work so that stamp duty, title transfer and corporate compliance are handled together. Our firm also advises foreign companies establishing operations in Kenya, handling branch registration, local agent appointment and the regulatory requirements specific to particular sectors.

This guide is published by OLM Law Advocates LLP for general information only. It does not constitute legal advice and should not be relied on as such. The law, government fees and processing times described are accurate as of the date of publication but may change. For advice on your specific circumstances, please contact us.