Nairobi International Financial Centre Act

Section 1. Short title Section This Act may be cited as the Nairobi International Financial Centre Act.

Section 2. Interpretation Section In this Act, unless the context otherwise requires— "Authority" means the Nairobi International Financial Centre Authority established under section 5 ; “Board” means the Board of directors of the Authority constituted under section 8 ; “Cabinet Secretary” means the Cabinet Secretary for the time being responsible for matters relating to finance; "Centre" means the Nairobi International Financial Centre established under section 4 ; "Council" means the Steering Council established under section 19 ; "NIFC firm" means a person certified as such by the Authority under section 28 (4); "person" includes a company, association or other body of persons whether incorporated or unincorporated; "regulatory authority" includes the Central Bank of Kenya, the Capital Markets Authority, the Insurance Regulatory Authority, the Retirement Benefits Authority, and the Sacco Societies Regulatory Authority or their successors thereof; "Tribunal" means the Financial Centre Tribunal established under section 35 ; and "qualified activity" refers to an activity designated as such by the Cabinet Secretary under section 27 .

Section 3. Act to prevail Section Where there is any conflict or inconsistency between this Act and the provisions of any other Act in matters relating to the purpose of this Act, this Act shall prevail.

Section 4. Establishment of the Centre Section 4(1) There is established the Nairobi International Financial Centre. Section 4(2) The Centre shall be an operating framework managed by the Authority in order to facilitate and support the development of an efficient and globally competitive financial services sector in Kenya.

Section 5. Establishment of the Authority Section 5(1) There is established the Nairobi International Financial Centre Authority. Section 5(2)(a) suing and being sued; Section 5(2)(b) taking, purchasing or otherwise acquiring, holding, charging or disposing of movable and immovable property; Section 5(2)(c) borrowing or lending money; Section 5(2)(d) entering into contracts; and Section 5(2)(e) doing such other acts necessary for the proper performance of the functions of the Authority. Section 5(3) The Authority shall be the successor to the Nairobi International Financial Centre Authority established under the Nairobi International Financial Centre Authority Order (L.N. 44/2014). Section 5(4) Subject to this Act, all rights, duties, obligations, assets and liabilities of the Nairobi International Financial Centre Authority existing at the commencement of this Act shall be automatically and fully transferred to the Authority.

Section 6. Objectives of the Authority Section establish and maintain an efficient operating framework in order to attract and retain firms;

Section 7. Powers and functions of the Authority Section formulate and implement policies relating to the establishment, operations and administration of the Centre;

Section 8. Board of the Authority Section 8(1)(a) a non-executive Chairperson appointed by the President; Section 8(1)(b) the Cabinet Secretary responsible for matters relating to finance, or a representative appointed in writing by the Cabinet Secretary; Section 8(1)(c) the Cabinet Secretary responsible for matters relating to international trade, or a representative appointed in writing by the Cabinet Secretary; Section 8(1)(d) the Attorney-General, or a representative appointed in writing by the Attorney-General; Section 8(1)(e) four other persons with relevant international financial services experience appointed by the Cabinet Secretary; and Section 8(1)(f) the Chief Executive Officer who shall be an ex officio member with no right to vote. Section 8(2)(a) holds a degree from a university recognized in Kenya; Section 8(2)(b) finance, economics, banking, insurance or capital markets; Section 8(2)(b)(i) finance, economics, banking, insurance or capital markets; Section 8(2)(b)(ii) corporate or financial services law; or Section 8(2)(b)(iii) any other field that is relevant to the functions of the Authority; and Section 8(2)(c) meets the requirements of Chapter Six of the Constit...

Section 9. Term of office Section 9(1) The Chairperson and members of the Board appointed under section 8 (1)(a) and (e) respectively shall serve for a term of three years and shall be eligible for re-appointment for one further term of three years. Section 9(2) The appointment of members of the Board shall be done in such a manner as to ensure that the terms of the members appointed do not lapse at the same time and that there is continuity of service.

Section 10. Procedure of Board meetings Section 10(1) The procedures for the conduct of business and affairs of the Board shall be as set out in the Schedule. Section 10(2) Except as provided in the Schedule, the Board may regulate its own procedure.

Section 11. Functions and powers of the Board Section 11(1) The Board shall have all the powers necessary for the performance of the functions of the Authority under this Act. Section 11(2)(a) lay down the general policies and plans for the Authority in accordance with international best practices; Section 11(2)(b) prepare the annual budget of the Authority for the purpose of funding the administrative activities of the Centre; Section 11(2)(c) administer the assets and funds of the Authority in such a manner and for such purposes as shall promote the best interests of the Authority; Section 11(2)(d) receive grants, donations or any other moneys on behalf of the Authority and make legitimate disbursements therefrom; Section 11(2)(e) open such banking accounts for the funds of the Authority as may be necessary; Section 11(2)(f) ensure the Authority is run at all times in accordance with this Act and best international practices; and Section 11(2)(g) perform any other function necessary to achieve the objectives of the Authority.

Section 12. Delegation by the Board Section The Board may, by resolution either generally or in any particular case, delegate to a committee of the Board, or to any member, officer, employee or agent of the Authority, the exercise of any powers or the performance of any functions or duties of the Board under this Act or any other written law.

Section 13. Remuneration of Board members Section The Chairperson and members of the Board shall be paid such remuneration or allowances as the Authority may, in consultation with the Salaries and Remuneration Commission, determine.

Section 14. Chief Executive Officer Section 14(1) There shall be a Chief Executive Officer of the Authority who shall be competitively recruited and appointed by the Cabinet Secretary on the recommendation of the Board. Section 14(2) The Chief Executive Officer shall serve on such terms and conditions of employment as the Board may, in consultation with the Cabinet Secretary, determine. Section 14(3)(a) holds a degree from a university recognized in Kenya; Section 14(3)(b) banking, insurance or capital markets; Section 14(3)(b)(i) banking, insurance or capital markets; Section 14(3)(b)(ii) finance or economics; Section 14(3)(b)(iii) corporate or financial services law; or Section 14(3)(b)(iv) such other field that is relevant to the functions of the Authority; Section 14(3)(c) has relevant experience in the development of the financial services sector; and Section 14(3)(d) meets the requirements of Chapter Six of the Constitution of Kenya. Section 14(4) The Chief Executive Officer shall, subject to the directions of the Board, be responsible for the day-to-day management of the Authority. Section 14(5) The Chief Executive Officer shall hold office for a term of four years and shall...

Section 15. Staff of the Authority Section 15(1) The Authority may appoint such staff as are necessary for the performance of its functions under this Act. Section 15(2) The staff appointed under subsection (1) shall serve on such terms and conditions of service as the Authority may, in consultation with the Salaries and Remuneration Commission, determine.

Section 16. Protection from personal liability Section No matter or thing done by any member of the Board or by any officer, employee, agent or servant of the Authority or Tribunal shall, if the act or omission was done in good faith for the purpose of performing the functions of the Authority or Tribunal under this Act, render the person liable for any action, claim or demand.

Section 17. Confidentiality Section 17(1)(a) to be disclosed under any law; Section 17(1)(b) for the performance of his or her duties or the exercise of his or her functions under this Act; or Section 17(1)(c) by a court of law. Section 17(2) This section shall not apply to any document, material or information which at the time of disclosure is, or has already been made lawfully available to the public. Section 17(3) A person who has any document, material or information which to his or her knowledge has been disclosed in contravention of subsection (1) shall not disclose, in any manner, the document, material or information to any other person. Section 17(4) A person who contravenes subsection (1) or (3) shall be liable on conviction to a fine not exceeding two hundred thousand shillings or to imprisonment for a term not exceeding three years or to both.

Section 18. Common seal Section 18(1) The common seal of the Authority shall be kept in such custody as the Board may direct and shall not be used except on the order of the Board. Section 18(2) The affixing of the common seal of the Authority shall be authenticated by the signature of the Chairperson and the Chief Executive Officer and any document not required by law to be made under seal and all decisions of the Board may be authenticated by the signatures of both the Chairperson and the Chief Executive Officer. Section 18(3) Notwithstanding the provisions of subsection (2), the Board shall, in the absence of either the Chairperson or the Chief Executive Officer in a particular matter, nominate one member to authenticate the seal on behalf of either the Chairperson or the Chief Executive Officer. Section 18(4) The common seal of the Authority when affixed to a document and duly authenticated shall be judicially and officially noticed unless the contrary is proved, any necessary order or authorization by the Board under this section shall be presumed to have been duly given.

Section 19. Establishment of the Steering Council Section 19(1)(a) President as the Chairperson; Section 19(1)(b) Deputy President as the deputy Chairperson; Section 19(1)(c) Cabinet Secretary responsible for matters relating to finance; Section 19(1)(d) Attorney-General; Section 19(1)(e) Governor of the Central Bank of Kenya; Section 19(1)(f) Chief Executive Officer of the Capital Markets Authority; Section 19(1)(g) Chief Executive Officer of the Insurance Regulatory Authority; Section 19(1)(h) Chief Executive Officer of the Retirement Benefits Authority; and Section 19(1)(i) Chairperson of the Authority. Section 19(2) The Authority shall provide secretariat services to the Council. Section 19(3) The Council may from time to time, co-opt any person to advise on a specified matter. Section 19(4)(a) shall review the progress of the Centre, provide direction and address any challenges in the development of the Centre and the overall financial services sector in Kenya; and Section 19(4)(b) may, from time to time, give such directions to any person which the Council considers necessary in order to achieve the objectives of this Act. Section 19(5) The Council shall meet at least three t...

Section 20. Funds of the Authority Section such monies or assets which may accrue to or vest in the Authority in the course of the exercise of its powers or the performance of its functions under this Act;

Section 21. Investment of funds Section 21(1) The Authority may invest any of its funds in securities in which for the time being trustees may by law invest in trust funds, or in any other securities which the National Treasury may, from time to time approve. Section 21(2) The Authority may place or deposit with any bank as it may determine, any monies not immediately required for the purposes of the Authority.

Section 22. Financial year Section The financial year of the Authority shall be the period of twelve months commencing on the first of July and ending on thirtieth of June in each year.

Section 23. Annual estimates Section 23(1) The Board shall, at least three months before the commencement of each financial year, cause to be prepared estimates of revenue and expenditure of the Authority for that financial year. Section 23(2)(a) payment of salaries, allowances and other charges in respect of the Board and staff of the Authority; Section 23(2)(b) rental expenses for the premises of the Authority; Section 23(2)(c) payment of pensions, gratuities and other charges in respect of retirement benefits to the staff of the Authority which are payable out of the funds of the Authority; Section 23(2)(d) effective development and promotion of the Centre in Kenya and overseas; Section 23(2)(e) running of the certification, registry, dispute resolution and external entity coordination activities of the Authority; Section 23(2)(f) proper maintenance, repair and replacement of equipment and other movable property of the Authority; and Section 23(2)(g) payment of any other costs as may be incurred by the Authority. Section 23(3) The Board shall approve the annual estimates before the commencement of the financial year to which they relate and shall submit the same to the Cabinet S...

Section 24. Accounts and audit Section 24(1) The Board shall cause to be kept proper books and records of accounts of income, expenditure, assets and liabilities of the Authority. Section 24(2)(a) a statement of income and expenditure of the Authority during the year; Section 24(2)(b) a statement of assets and liabilities of the Authority on the last day of that year; and Section 24(2)(c) a funds flow statement during that year. Section 24(3) The accounts of the Board shall be audited and reported upon in accordance with the provisions of the Public Audit Act (Cap. 412B).

Section 25. Annual report Section 25(1) The Board shall, within three months after the end of each financial year, prepare and submit to the Cabinet Secretary, an annual report for the immediate preceding financial year. Section 25(2) The Cabinet Secretary shall lay the annual report before the National Assembly as soon as is practicable.

Section 26. Restriction on carrying out qualified activities Section 26(1) A person shall not conduct any qualified activity as an NIFC firm or hold itself out as such unless that person is certified by the Authority under this Act. Section 26(2) A person who contravenes the provisions of subsection (1) commits an offence and is liable on conviction to a fine not exceeding ten million shillings or to imprisonment for a term not exceeding five years or to both. Section 26(3) Where the offence is committed by a body corporate, the body corporate shall be liable on conviction to a fine not exceeding ten million shillings.

Section 27. Qualified activities Section 27(1) A certified firm may conduct any business activity which the Cabinet Secretary may designate in the Gazette as a qualified activity. Section 27(2) Despite subsection (1), a person shall not conduct a qualified activity for which a licence from a regulatory authority is required, unless that person has obtained the appropriate licence from the regulatory authority.

Section 28. Application for certification Section 28(1) A person who intends to operate as an NIFC firm shall apply to the Authority, in the prescribed form, to be certified as such. Section 28(2) An application under subsection (1) shall be accompanied by the prescribed application fee and any other additional information as the Authority may require. Section 28(3) The Authority shall, in considering an application for certification under subsection (1), be satisfied as to the ability of the applicant to meet the prescribed conditions for certification in line with the objectives of the Centre. Section 28(4)(a) subject to the payment of the prescribed fee and to such conditions as the Authority may consider necessary, certify a firm to operate as an NIFC firm; or Section 28(4)(b) decline to certify a firm. Section 28(5)(a) notify the applicant of its decision to do so setting out the reasons for the decline; and Section 28(5)(b) grant the applicant an opportunity to be heard. Section 28(6)(a) withdrawn or suspended by the Authority; or Section 28(6)(b) voluntarily surrendered by the firm. Section 28(7) An NIFC firm shall pay an annual fee as the Authority may prescribe from time t...

Section 29. Withdrawal or suspension of certification Section 29(1)(a) the Authority is satisfied that any information furnished in connection with an application for certification was false or misleading; Section 29(1)(b) the firm has contravened or failed to comply with this Act, any direction or guideline issued or condition attached to the certification; Section 29(1)(c) the firm has engaged in a prohibited activity; Section 29(1)(d) the regulatory authority has withdrawn or revoked the firm's licence; Section 29(1)(e) the certified firm has conducted its affairs in a manner which threatens the interests of its customers; Section 29(1)(f) the certified firm is in violation of any other law; or Section 29(1)(g) it is in the interest of the public to do so. Section 29(2) The Authority may, instead of withdrawing a certification under subsection (1), suspend the certification for a specified period or impose conditions or restrictions on the certification. Section 29(3) Where the Authority withdraws a certification under subsection (1), the Authority shall inform the relevant regulatory authority of its decision to do so and the firm shall immediately lose its status as an NIFC fi...

Section 30. Register of NIFC firms Section 30(1) The Authority shall keep a register of all NIFC firms. Section 30(2) The Authority shall make public the register kept under subsection (1) and any other information relating to the NIFC firms which the Authority considers appropriate by placing it on the Authority's website.

Section 31. Inspection of NIFC firms Section The Authority may, in collaboration with the relevant regulatory authority, cause an inspection to be made by an authorized person, of an NIFC firm and its books and records to ascertain if the NIFC firm continues to meet the conditions of certification.

Section 32. Rights and benefits for NIFC firms Section not be subject to any nationalisation or expropriation measures or any restrictions on private ownership;

Section 33. Settlement of disputes Section 33(1) Where there is a dispute between the Authority and an NIFC firm arising out of or in connection with the rights and benefits conferred by section 32 , the dispute shall be settled by arbitration, and, unless otherwise agreed by the parties, by a sole arbitrator, to be appointed by the Registrar of the Nairobi Centre for International Arbitration and any award, order or determination of or by such arbitrator shall be final and binding on all parties. Section 33(2) The dispute referred to the arbitrator appointed by the Registrar under subsection (1) shall be administered in accordance with the Rules for arbitration of the Nairobi Centre for International Arbitration.

Section 34. Rules and guidelines Section Without prejudice to the generality of the powers conferred under this Act, the Authority may formulate rules or issue guidelines as may be required in order to perform its functions under this Act.

Section 35. Establishment of Tribunal Section 35(1)(a) a Chairperson with ten years' experience in adjudicating financial services and regulatory disputes; and Section 35(1)(b) four other members with seven years' experience in the financial services sector. Section 35(2)(a) be of good character; and Section 35(2)(b) meets the requirements of Chapter Six of the Constitution of Kenya. Section 35(3) The Chairperson and members of the Tribunal shall be appointed for a term of three years renewable for one further term of three years. Section 35(4) The appointment of members to the Tribunal shall be done in such a manner as to ensure that the terms of the members appointed do not lapse at the same time and that there is continuity of service. Section 35(5)(a) becomes incapable through ill-health of effectively performing the duties of his or her office; Section 35(5)(b) accepts any position of employment the holding of which conflicts with his or her role in the Tribunal; Section 35(5)(c) is declared bankrupt; Section 35(5)(d) is convicted of a criminal offence; Section 35(5)(e) fails to attend three consecutive meetings of the Tribunal without the permission of the Tribunal; Section 3...

Section 36. Secretary to the Tribunal Section The Judicial Service Commission shall appoint the Secretary to the Tribunal.

Section 37. Staff of the Tribunal Section 37(1) The Judicial Service Commission may appoint such staff as are necessary for the performance of the functions of the Tribunal under this Act. Section 37(2) The staff appointed under subsection (1) shall serve on such terms and conditions as the Judicial Service Commission may, in consultation with the Salaries and Remuneration Commission from time to time, determine.

Section 38. Protection from personal liability Section No matter or thing done by any of the member of the Tribunal shall, if the act or omission was done in good faith for the purpose of exercising the powers of the Tribunal under this Act, render the person liable for any action, claim or demand.

Section 39. Rules of the Tribunal Section 39(1) The Chief Justice shall lay down the rules and procedures of the Tribunal in accordance with fundamental dispute resolution principles and international best practices. Section 39(2)(a) the way in which applications for review are to be made; Section 39(2)(b) the procedure to be adopted by the Tribunal; Section 39(2)(c) the nature of records to be kept; Section 39(2)(d) the procedure of giving notice to the parties; Section 39(2)(e) the fees to be charged; and Section 39(2)(f) costs. Section 39(3) The provisions of the Civil Procedure Act ( Cap. 21 ) shall apply to the claims submitted before the Tribunal, where this Act, its Regulations and the Rules and procedure are silent on the concerned matter.

Section 40. Regulations Section 40(1) The Cabinet Secretary may, on the recommendation of the Authority, make Regulations generally for the better carrying out the purposes and objectives of this Act. Section 40(2)(a) designate qualified activities to be conducted by NIFC firms; Section 40(2)(b) determine any benefits, exemptions and incentives available to NIFC firms; Section 40(2)(c) determine the general conditions of entry of firms to the Centre; Section 40(2)(d) provide for the certification process of NIFC firms; Section 40(2)(e) provide for the payment of compensation and penalties or fines in the event of a breach of the provisions of this Act or its regulations; Section 40(2)(f) prescribe information required of NIFC firms; and Section 40(2)(g) address any other matter required in order to achieve the objectives of this Act.

Section 41. Definition under this Part Section In this Part, "former Authority" means the Nairobi International Financial Centre Authority established under the Nairobi International Financial Centre Authority Order, 2014 (L.N. 44/2014).

Section 42. Revocation Section 42(1) The Nairobi International Financial Centre Authority Order, 2014 (L.N. 44/2014) is revoked. Section 42(2)(a) the funds, assets and other property, both movable and immovable, which immediately before the commencement of this Act were vested in the former Authority shall, upon commencement of this Act, be vested in the Authority; Section 42(2)(b) the annual estimates of the former Authority for the financial year shall, upon commencement of this Act, be deemed to be annual estimates of the Authority for the remainder of the financial year; Section 42(2)(c) all rights, powers and liabilities whether arising under any written law or otherwise which immediately before the commencement of this Act were vested in, imposed on or enforced against the former Authority shall, upon commencement of this Act, be deemed to be vested in, imposed or enforceable against the Authority; and Section 42(2)(d) any person who was a member of staff of the former Authority shall, upon commencement of this Act, be deemed to be a member of staff of the Authority for the remaining period of his or her service.