The Kenyan Parliament is planning to raise the bar for foreign companies to do business in Kenya with proposals to amend the Securities and Exchange Commission Act.
For example, a foreigner who fails to claim to be Kenyan to register a company will face a fine of KSh5 million or imprisonment.
The National Assembly has also sought to prevent Kenyans from registering companies in the names of foreigners.
The new amendments also aim to prevent foreign companies from participating in tenders under KSh1 billion that are only awarded to local companies.
- Advertisement -
“A person who registers a company on behalf of a foreigner exhibiting unfair competition and seeks to benefit from the procurement commits an offence and shall be liable, upon conviction, to a fine not exceeding Ksh5 million, or to a term of imprisonment not exceeding three years, or to both,” reads the Public Procurement and Asset Disposal (Amendment) Bill, 2024.
According to the bill, it would also be an offence for a foreigner to register a company and attempt to profit from it by fraudulently purchasing goods from a Kenyan.
Only foreign companies partnering with local companies have received contracts over KSh 1 billion. – If the value of the purchase exceeds KSh 1 billion, the supplier must specify the specific products, operations and services that must be provided by the local company as a joint venture in addition to the requirements.
The bill also makes it harder for companies or individuals who do not do business elsewhere to set up shop in Kenya. Recognizing the role of the international body, it said any person or company banned from the world body should be considered sanctioned in Kenya. Convictions and judicial decisions in Kenya are handed down “for a specified period of years.”
The bill also states that a successful candidate, who is a national contractor, shall not enter into a contract with a foreign company unless the knowledge, skills, equipment or services are available in the country.”
- Advertisement -
The bill, sent to the Director of Legal Services on November 6, 2024, also imposes more requirements on immigrants to obtain equipment. It is envisaged that shopping malls must obtain at least 40 per cent of all goods and services from local sources and that compliance with this must be ensured by the Supervisory Board within three months.
