It has been said that no man is an island and the company being a juridical person is no exception. There is need to incorporate foreign companies to encourage healthy completion. In the recent various foreign companies have been incorporated in Kenya for instance Oilibya from Libya.
Foreign companies are companies incorporated outside Kenya which, after the appointed day, establish a place of business within Kenya and companies incorporated outside Kenya which have, before the appointed day established a place of business within Kenya
Requirements for the Registration of a Foreign Company
The Registrar shall approve the application for registration and register the company by entering its name and other particulars in the Foreign Companies Register if the application-
a) Contains the information prescribed by the regulations for the purposes of this section;
b) Demonstrates that at least thirty percent of the company’s shareholding is held by Kenyan citizens by birth;
c) Is accompanied by the prescribed fee, if any, and the required documents; and
d) Complies with the requirements of this Part with respect to the company’s name and the appointment of a local representative.
The documents required to accompany the application the foreign companies are
1. Certified copy of the foreign company’s current certificate of Formation or incorporation or registration in the company’s place of origin, or a document of similar effect;
2. A certified copy of the company’s constitution (memorandum and articles of association);
3. A list of the names of the company’s directors and shareholders, and their personal details;
4. A memorandum executed by or on behalf of the company indicating the powers of directors, if any, who reside in Kenya and are members of a local board of directors;
5. In respect to any existing charge on property of the foreign company that would be a registrable charge if the foreign company were a company incorporated in Kenya, the documents that would be required to be lodged for registration with the Registrar of Companies;
6. Notice of the address of the company’s registered office in its Country of origin, if any; otherwise, the address of its principal place of business in its place of origin; and
7. Notice of the address of the company’s registered office in Kenya.
Registering a foreign company
On registering a foreign company, the Registrar shall —
(a) Allocate a unique identifying number to the company.
(b) Issue to the company a certificate of registration
Contents of a certificate of registration
A certificate of registration complies with this subsection if it states
a) The name of the company and its unique
b) Identifying number and the fact that the company is registered under this Act as a foreign company;
c) The date of its registration as a foreign company
d) The date of its incorporation in its place of origin
Requirements with respect to name, of foreign company’s foreign company shall include particulars of the name
Registered foreign company shall paint or affix and keep painted or affixed, in a conspicuous position and in letters easily legible, on the outside of every office and place (including its registered office) that is in Kenya, at which its business is carried on and that is open and accessible to the public.
State its name and other specified information in prescribed classes of documents and communications relating to its business in Kenya
its name and the name of its place of origin;
If the liability of its members is limited and the last word of its name is neither the word “Limited” nor the abbreviation “Ltd.”—notice of the fact that the liability of its members is limited; and
in the case of its registered office—the expression “Registered Office
The name of a foreign company must be contained in the following documents
• In every prospectus inviting subscriptions for its shares or debentures in Kenya; and
• On every place where it carries on business in Kenya;
• In all bill-heads and letter paper, and in all notices and other official publications of the company; and;
• If the liability of the members of the company is limited, cause notice of that fact to be stated in the places mentioned above.
Consequences of failure to comply with rules relating to the name of the company
If a registered foreign company fails to comply with subsection (1), the company and each officer of the company who is in default, commit an offence and on conviction are each liable to a fine not exceeding one hundred thousand shillings.
Prospectus of a foreign company
The prospectus of a foreign company is subject to almost the same rules as that of a company incorporated in Kenya. It is unlawful to issue in Kenya a prospectus offering for subscription shares or debentures of a company incorporated outside Kenya unless the prospectus is dated and contains the following particulars:
• The instrument defining the companies constitution
• The enactment under which the company is incorporated
• The address in Kenya where this instrument can be inspected
• The date and country of incorporation
• The address of the principal place where it carries on its business in Kenya, if any.
Note: An application for shares must be accompanied by proper prospectus and a statement by an expert, if that he has given and has not withdrawn his consent to the issue of the prospectus in Kenya. A copy of the prospectus must be filed with the registrar.
Local representatives of foreign companies
A foreign company must have at least one local representative in relation to whom the foreign company has complied with the prescribed requirements of the foreign companies regulations relating to local representatives of foreign companies.
Within one month after a registered foreign company has appointed a person as a local representative of the company in Kenya, the company shall lodge with the
Registrar for registration a notice of the appointment, specifying the person’s name and residential address and such other particulars (if any).
Death of a local representative
Within one month after a person who is a local representative of a registered foreign company has died, resigned or otherwise ceased to hold office as such, the company shall lodge with the Registrar for registration a notice to the effect that the person has ceased to be a local representative of the company in Kenya.
Liability of a local representative
A local representative of a registered foreign company-
is answerable for the doing of all acts, matters and things that the company is required by or under the Act to do;
And is personally liable to a penalty imposed on the company for a contravention of, or failure to comply with, the Act if the Court hearing the matter is satisfied that the local representative should be so liable.
Liability of representatives appointed in the company
If a registered foreign company has two or more local representatives, those representatives are jointly and severally Answerable for the doing of all acts and things that the company is required by or under this Act to do; and
Personally liable to a penalty imposed on the company for a contravention of, or failure to
A registered foreign company shall establish and maintain a registered office in Kenya to which all communications and notices may be addressed.
Rules on the registered office
The company shall ensure-
o That its registered office is kept open on each business day from at least 10 a.m. to 12 noon and from at least 2 p.m. to 4 p.m.; and
o That a local representative of the company is present at all times when the office is open.
o The company shall lodge with the Registrar for registration a notice of the hours between 9 a.m. and 5 p.m. on each business day during which the body’s registered office in Kenya is kept open.
o The company shall, within seven days after making a change in the location of its registered office in Kenya, lodge with the Registrar for registration a notice of the change and of the new address of that office.
o The company shall, within seven days after making a change to the hours during which its registered office in Kenya is kept open, lodge with the Registrar for registration a notice of the change.
Consequences of failure to comply with rules relating to the registered office
If a registered foreign company fails to comply with a requirement of this section, the company and each officer of the company who is in default, commit an offence and on conviction are each liable to a fine not exceeding two hundred thousand shillings.
Notice of changes made by the foreign company
A registered foreign company shall, within one month after a change occurs in the following submit the changes to the registrar of companies:
a. Its constitution or any other document lodged in relation to the company;
b. Its directors;
c. The powers of any directors who reside in Kenya and members of a Kenyan board of directors of
d. The company; or
e. A local representative or local representatives;
f. The name or address of a local representative; or
g. The location of its registered office
Copies of registered foreign company’s financial statements and other documents to be lodged with Registrar.
A registered foreign company shall, at least once in every calendar year and at intervals of not more than fifteen months, lodge a copy of its financial statement made up to the end of its last financial year, in such form and containing such particulars, and including copies of such documents, as the being applicable to that company in its place of origin, together with a statement in writing, supported by a statutory declaration, verifying that the copies are true copies of the documents so required.
Circumstances in which name of registered foreign company can be struck off or restored to Register of Foreign Companies
a. Within one month after a registered foreign company has ceased to carry on business in Kenya
b. Within one month after a registered foreign company has been dissolved or deregistered in its place of origin,
c. Where the registrar has reasonable cause to believe that a foreign company has ceased to have a place of business in Kenya
d. If he registrar receives a reply to the effect that the company has ceased to have a place of business in Kenya
e. It is conducting illegal trade
f. If it has attained an enemy character
g. is carrying on such a business without having a local representative
If a foreign company’s name is struck off the register under subsection (3), the company ceases to be registered