Cost of LLC incorporation in Kenya

Cost of LLC in Kenya

In recent years, Kenya has attracted an influx of foreigners and foreign based companies wishing to do business in the country.

If you are among this group, probably you would want to know the cost of incorporating an LLC in Kenya.

The professional fee estimates for incorporating an LLC in Kenya ranges between $5,000 to $8,000.

Below, we discuss some of the factors that affect the cost of incorporating an LLC in Kenya.

  1. Corporate Structure

An LLC in Kenya requires at least one member, and a maximum of 50 – who is/are a shareholder(s). This does not include employees.

A foreign entity duly registered in another country can register and operate the following business models in Kenya:

(a). A subsidiary of the foreign entity;

A subsidiary is like a local incorporated company with the only difference being that it is wholly or largely owned by another incorporated entity. This can be incorporated either as a private limited liability company or a public limited liability company depending on the number of members.

The number of members for a private limited liability company can range from one (1) member up-to fifty (50) members excluding employees. This means that the subsidiary can be wholly owned by the parent company.

On the other hand, there is a requirement that it must have at least one director who is a natural person.

(b). A branch office of the foreign entity

A branch is essentially a company organized to conduct business on behalf of a parent company in another jurisdiction. The branch office is like a new placement, department or division that is set up under the parent company’s name and forms part of that legal entity.

  1. Legal Fees

Another factor that determines the cost of incorporating an LLC in Kenya is legal fees. You will require an attorney to navigate the Kenyan legal system.

  1. Registrar Fees

Incorporating an LLC in Kenya attracts registrar fees of about USD 100 as of November 2022. Get more fees related to company incorporation here.

  1. Company Secretarial Fees

A foreigner who has an LLC based in Kenya requires a local secretarial service that will definitely add up to the cost.

The advantages of incorporating an LLC in Kenya as a foreigner vis-a-vis other African countries include:

  1. Shorter and straight forward registration process

Registration process is simple and straight forward thus foreign companies seeking to set up base in Kenya do not face complex procedures of registration;

The process currently takes anywhere between 3-7 working days if there are no sector specific approvals required.

  1. It is registered under the Kenya company laws which is based on the English common law

Kenya is among the 80 countries in the world that use the English common law.

  1. Has no restriction on foreign ownership

Foreigners can incorporate/register a business entity with 100% ownership. The incorporation/registration of a foreign entity in Kenya is governed by the Companies Act, 2015 as well as sector specific laws.

Sector specific laws are laws governing the industry/ market where the foreign entity wishes to operate in. For instance, anyone wishing to operate a forex brokerage business must, obtain the relevant license from the Capital Markets Authority (CMA), the industry’s regulator.

  1. Simplified corporate structure- minimum of one director/shareholder

The requirement is that it must have at least one director who is a natural person

  1. No restriction on the business activities as long as they are not outlawed

New incorporated LLC in Kenya have unfettered access to the new market and can target consumers of their approved goods and service without any interference.

Learn more of our Kenyan solutions here.

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