The Companies (General) Regulations

Section 1. Citation and commencement Section 1(1) These regulations may be cited as the Companies (General) Regulations. Section 1(2) Except as provided by subsection (3), these regulations come into operation on the fourteenth day after their publication in the Gazette. Section 1(3) Those provisions of these regulations that relate to provisions of the Act that have not come into operation by the day specified in paragraph (2) come into operation on the day on which those provisions of the Act come into operation.

Section 2. Definition of "the Act" for the purposes of these regulations Section In these regulations— “the Act” means the Companies Act (Cap. 486).

Section 3. Prescribed forms Section The forms set out in the First Schedule are the forms that are prescribed for use under the provisions of the Act specified in the forms.

Section 4. Provisions supplementing definitions of "parent undertaking" and "subsidiary undertaking" Section 4(1)(a) it has the power to exercise, or actually exercises, dominant influence or control over it; or Section 4(1)(b) it and the subsidiary undertaking are managed on a unified basis. Section 4(2) An undertaking is also a subsidiary undertaking of another undertaking if, because of paragraph (1), the other undertaking is the parent of the undertaking. Section 4(3) A parent undertaking is taken to be the parent undertaking of undertakings in relation to which any of its subsidiary undertakings are, or are taken to be, parent undertakings; and references to its subsidiary undertakings are to be interpreted accordingly. Section 4(4) The Second Schedule contains provisions explaining the definition of "parent undertaking" and "subsidiary undertaking" as used in the Act and otherwise supplementing those definitions. Section 4(5) In this paragraph and the Second Schedule, references to shares (of an undertaking) are to allotted shares.

Section 5. Additional documents to accompany application for registration of a company Section a copy of their identity card or passport;

Section 6. Statement of capital and initial shareholdings Section 6(1)(a) voting rights that attach to the shares (including voting rights that arise only in certain circumstances); Section 6(1)(b) rights to dividends or distributions attached to the shares; Section 6(1)(c) any right to participate in a return of capital (including on the liquidation of the company); Section 6(1)(d) whether the shares will be redeemed or may be redeemed at the option of the company or the shareholder; Section 6(1)(e) any terms or conditions relating to redemption of the shares. Section 6(2) For the purposes of section 14(3) of the Act, the statement of capital and initial shareholdings is required to include the name and address of each subscriber to the memorandum of association.

Section 7. Statement of guarantee Section For the purposes of section 15(1) of the Act, the statement of guarantee is required to specify the name and address of each subscriber to the memorandum of association.

Section 8. Model articles for companies Section 8(1) The articles prescribed by the Third Schedule are model articles that are applicable to a public company. Section 8(2) The articles prescribed by the Fourth Schedule are model articles that are applicable to a private company. Section 8(3) The articles prescribed by the Fifth Schedule are model articles that are applicable to a company limited by guarantee.

Section 9. Names that indicate connection with public authorities Section 9(1) If an application for the approval by the Registrar of a name for a proposed company could in the Registrar's opinion give the impression that the company would, if registered with that name, be connected with a public authority, the Registrar shall require the applicant to request the authority to give its view on the matter. Section 9(2)(a) whether it considers that the name, if approved, would give the impression referred to in paragraph (1); and Section 9(2)(b) if the authority considers that the name would have that effect, whether it would object or not object to the name being approved for the company by the Registrar. Section 9(3)(a) give its view on the proposed name of the company; and Section 9(3)(b) if it considers that that name would give the impression that the company is, if registered under that name, connected with that authority, state whether it objects or does not object to the approval by the Registrar of the name for the company.

Section 10. Characters permitted to be used in company's name Section 10(1) For the purposes of section 52 of the Act, the characters, signs, symbols (including accents and other diacritical marks) and punctuation set out Part 1 of the Sixth Schedule can be used in the name of a company registered or to be registered under the Act. Section 10(2)(a) any character that has an accent or other diacritical mark, sign or symbol set out in Part 1 of the Sixth Schedule; Section 10(2)(b) 0, 1, 2, 3, 4, 5, 6, 7, 8 or 9; Section 10(2)(c) a full stop, comma, colon, semi-colon or hyphen; Section 10(2)(d) any other punctuation referred to in column 1 of Part 2 of the Sixth Schedule but only in one of the forms set out opposite that punctuation in column 2 of that Part. Section 10(3) The signs and symbols set out in Part 3 of the Sixth Schedule are characters that can be used but not if they are one of the first three characters of a company's name. Section 10(4) The name of a company may not consist of more than 160 permitted characters.

Section 11. Circumstances in which a company name will not be registered Section it is the same as a name appearing in the Registrar's Index of Company Names, Business Names, Limited Liability Partnerships or Partnerships;

Section 12. Criteria for determining offensive or undesirable names Section the name includes "co-operative", "society" or "trade union "or any variant or synonym of those words;

Section 13. Consent to registration of a name which is the same as another in the Registrar's index of company names Section 13(1) In this regulation— “existing corporation” means a body corporate whose name already appears in the Registrar's index of company names. Section 13(2)(a) the name of an existing company; or Section 13(2)(b) a name already reserved for a proposed company that is proposed to be registered, Section 13(3)(a) the existing company consents, or the promoters of the proposed company, consent, to the proposed name being the name of the applicant company; Section 13(3)(b) the applicant company forms, or is to form, part of the same group as the existing company or the proposed company; Section 13(3)(c) the consent of the existing company or the promoters of the proposed company as referred to in subparagraph (a); and Section 13(3)(c)(i) the consent of the existing company or the promoters of the proposed company as referred to in subparagraph (a); and Section 13(3)(c)(ii) that the applicant company forms, or is to form, part of the same group as the existing company. Section 13(4) The Registrar may accept the statement referred to in paragraph (3)(c) as sufficient...

Section 14. Interpretation: Part IV Section 14(1)(a) where it carries on its business; and Section 14(1)(b) that is open to the public; Section 14(1)(a) any contract or deed purporting to be signed by or on behalf of the company; Section 14(1)(b) any bill of exchange, promissory note or endorsement purporting to be signed by or on behalf of the company; Section 14(1)(c) any cheque or order for money or goods purporting to be signed by or on behalf of the company; or Section 14(1)(d) any consignment note, invoice, receipt or letter of credit of the company. Section 14(2) In this Part, a reference to a communication document or transaction instrument is a reference to it in hard copy form, electronic form or any other form. Section 14(3) In this Part, a reference to the website of a company includes any part of a website relating to the company which the company has caused or authorised to appear. [L.N. 19/2017, r. 4.]

Section 15. Display of registered name at registered office, etc Section 15(1)(a) its registered office; and Section 15(1)(b) every business venue of the company. Section 15(2) A company shall also ensure that its registered name is positioned so that it can be easily seen by any visitor to the office or business venue. Section 15(3)(a) the registered name is displayed for at least fifteen continuous seconds at least once in every four minutes; or Section 15(3)(b) the registered name is capable of being displayed within four minutes after a request to make the display is made through the electronic device. Section 15(4) Paragraphs (1), (2) and (3) do not apply to a company that has had no accounting transaction at any time since its incorporation. Section 15(5)(a) a liquidator or administrator of a company has been appointed; and Section 15(5)(b) the registered office or any business venue of the company is also a place where the business of the liquidator, receiver or manager is carried on,

Section 16. Registered name to appear in communication documents, etc Section in any communication document of the company;

Section 17. Adequacy of certain descriptions of companies Section uses the abbreviation "Co." or "Coy." instead of the word "Company" contained in the name of the company;

Section 18. Offences under this Part Section 18(1) If a company contravenes regulation 15(1) or (2) or 16 the company, and each officer of the company who is in default, commit an offence and, on conviction, each of them is liable to a fine not exceeding two hundred thousand shillings. Section 18(2)(a) issues or authorises the issue of any communication document of the company in respect of which regulation 16 is contravened; Section 18(2)(b) signs or authorises to be signed on behalf of the company any contract, deed, bill of exchange, promissory note, endorsement, cheque or order for money or goods in respect of which regulation 16(b) is contravened; Section 18(2)(c) issues or authorises the issue of any consignment note, invoice, receipt or letter of credit of the company in respect of which regulation 16(b) is contravened; or Section 18(2)(d) causes or authorises the appearance of a website of the company in respect of which regulation 16(c) is contravened,

Section 56. Additional information to be included in company's annual return Section 56(1)(a) the company name, its registered number and business name (if any); Section 56(1)(b) the date to which the company makes up the return; Section 56(1)(c) particulars of the total amount of the indebtedness of the company in respect of all mortgages and charges that are required to be registered with the Registrar under the Act; Section 56(1)(d) in the case of a company having a share capital, particulars relating to members and share capital of the company; Section 56(1)(e) in the case of a company not having a share capital (except for a company registered with an unlimited number of members)—the number of members of the company; Section 56(1)(f) any person who at the date of the return is a director or alternate director of the company; and Section 56(1)(f)(i) any person who at the date of the return is a director or alternate director of the company; and Section 56(1)(f)(ii) any person who at that date is a company secretary of the company, Section 56(2) In the case of a listed company, the particulars relating to members as required under paragraph (1)(d)(i) are limited to those relatin...

Section 57. Additional information to be included in annual return of private company Section since the date of the last return; or

Section 58. Documents to accompany annual return of public company or company limited by guarantee Section copies of the documents required to be sent to every member of the company under section 666 of the Act (Duty of company to send financial statements and reports to persons entitled) — certified by a director or company secretary of the company to be true copies; and

Section 19. Provisions for interpreting this Part Section 19(1)(a) a reference to a director, in relation to an undertaking that is not a company, is a reference to the person holding an office in that undertaking corresponding to that of a director of a company; and Section 19(1)(b) a reference to a connected entity, in relation to a director, is a reference to a body corporate connected with the director within the meaning of the First Schedule to the Act. Section 19(2)(a) the director is entitled to exercise, or control the exercise of, more than 50 per cent of the voting power at any general meeting of the body; or Section 19(2)(b) the directors, or a majority of the directors, of the body are accustomed to act in accordance with the directions or instructions of the director. Section 19(3) In paragraph (2), a reference to voting power the exercise of which is controlled by a director includes voting power the exercise of which is controlled by another body corporate if the director is entitled to exercise, or control the exercise of, more than 50 per cent of the voting power at any general meeting of that other body corporate.

Section 20. Interpretation of Division 2 Section 20(1)(a) the person's services as a director of the company concerned; or Section 20(1)(b) the person's services as a director of a subsidiary undertaking of the company; or Section 20(1)(b)(i) the person's services as a director of a subsidiary undertaking of the company; or Section 20(1)(b)(ii) the person's other services in connection with the management of the affairs of the company or a subsidiary undertaking of the company; Section 20(1)(a) given or to be given on or after the retirement or death of the person (including any annuity or other benefit paid or payable under any insurance policy on or after the retirement or death of the person); Section 20(1)(b) given or to be given in anticipation of the retirement of the person; or Section 20(1)(c) given or to be given in connection with the person's service rendered before the retirement or death of the person; Section 20(1)(d) any benefit which has been or is to be afforded solely because of the person's personal injury (including any incapacity or death caused by that injury) by accident arising out of and in the course of employment; and Section 20(1)(e) any retirement gift...

Section 21. Information about directors' remuneration to be included in notes to financial statements Section 21(1) The information about directors' remuneration prescribed by paragraph (2) is information required to be included in the notes to the financial statements of a company for a financial year. Section 21(2)(a) the aggregate amount of the remuneration paid to or receivable by the directors of the company in respect of their qualifying services; and Section 21(2)(b) if any such remuneration consist of a benefit otherwise than in cash, the nature of that benefit. Section 21(3)(a) the remuneration paid or receivable in respect of a person's services as a director, whether of the company or its subsidiary undertaking; and Section 21(3)(b) the remuneration paid or receivable in respect of that person's other services in connection with the management of the affairs of the company or its subsidiary undertaking. Section 21(4) Any remuneration paid or receivable in respect of a person accepting office as a director are to be treated as remuneration paid or receivable in respect of that person's services as a director. Section 21(5) For the purposes of this regulation, if any remun...

Section 22. Information about directors' retirement benefits to be included in notes to financial statements Section 22(1) The information about directors' retirement benefits prescribed by paragraph (2) is information required to be included in the notes to the financial statements of a company for a financial year. Section 22(2)(a) the aggregate amount of the retirement benefits paid to or receivable by the directors of the company in respect of their qualifying services; and Section 22(2)(b) if any such retirement benefits consist of a benefit otherwise than in cash, the nature of that benefit. Section 22(3)(a) the retirement benefits paid or receivable in respect of a person's services as a director, whether of the company or its subsidiary undertaking; and Section 22(3)(b) the retirement benefits paid or receivable in respect of that person's other services in connection with the management of the affairs of the company or its subsidiary undertaking. Section 22(4) For the purposes of paragraphs (2) and (3), any amount of the retirement benefits paid or receivable under a retirement benefits scheme is to be disregarded if the contributions made under the scheme are substantiall...

Section 23. Information about payments made or benefit provided in respect of termination of directors' services Section 23(1) The information prescribed by paragraph (2) about payments made, or benefits provided, in respect of the termination of the services of directors (whether in the capacity of directors or in any other capacity while directors) is information required to be included in the notes to the financial statements of a company for a financial year. Section 23(2)(a) the aggregate amount of the payments for loss of office (as defined by section 180 of the Act) made to or receivable by the directors of the company, whether in cash or otherwise, in respect of the termination of the qualifying services of the directors; and Section 23(2)(b) if any such payments for loss of office consist of a benefit otherwise than in cash, the nature of that benefit. Section 23(3)(a) the payments made to or receivable by a person for the loss of office as a director, whether of the company or its subsidiary undertaking; and Section 23(3)(b) the payments made to or receivable by that person for the loss of any other office in connection with the management of the affairs of the company or...

Section 24. Information about consideration provided to or receivable by third parties for making available directors' services Section 24(1) The information prescribed by paragraph (2) about consideration provided to or receivable by any third party for making available the services of a person as a director of a company, or in any other capacity while a director, is information required to be included in the notes to the financial statements of a company for a financial year. Section 24(2)(a) the aggregate amount of the consideration provided to or receivable by the third party, whether in cash or otherwise, for making available the qualifying services of such a person; and Section 24(2)(b) if any such consideration consists of a benefit otherwise than in cash—the nature of that benefit. Section 24(3)(a) the director; Section 24(3)(b) a connected entity of the director; Section 24(3)(c) the company; or Section 24(3)(d) a subsidiary undertaking of the company. Section 24(4) For the purposes of this regulation, if any consideration consists of a benefit otherwise than in cash, to that extent, a reference to the amount of the consideration is a reference to the estimated money value...

Section 25. Only information included in company's records required to be given Section the information is included in the company's records; or

Section 26. Amounts paid or receivable in which period to be shown Section 26(1)(a) all relevant sums receivable in respect of that year (whenever paid); or Section 26(1)(b) in the case of sums not receivable in respect of a period, the sums paid during that year. Section 26(2) If an amount is shown for a financial year in the notes to the financial statements for that year in relation to the information prescribed by this Division, the corresponding amount for the immediately preceding financial year must also be shown in the notes.

Section 27. Payments made by or to which person to be shown Section 27(1) For the purposes of this Division, an amount shown in the notes to the financial statements of a company in relation to the information prescribed by this Part is to include all relevant sums, whether paid by or receivable from the company or its subsidiary undertaking or any other person. Section 27(2)(a) a payment to or receivable by a connected entity of the director; and Section 27(2)(b) a payment to a person made or to be made at the direction of, or for the benefit of, the director or a connected entity of the director. Section 27(3) In this Division, a reference to a payment by a person includes a payment by another person made at the direction of, or on behalf of, the person.

Section 28. Payments accounted for not to be included until liability released or not enforced Section 28(1)(a) that is to be accounted for to the company or any subsidiary undertaking of the company; or Section 28(1)(b) that is to be accounted for under section 187 of the Act (Payments made without approval: civil consequences) – to those who have sold their shares as a result of a takeover offer (within the meaning of section 584 of the Act) made. Section 28(2)(a) the amount of any payment received in a financial year is not shown in the notes to the financial statements for that year on the ground that the person receiving the payment is liable to account for it; and Section 28(2)(b) the liability is, wholly or partly, released subsequently or is not enforced within 2 years after the date on which the payment is received by the person,

Section 29. How to distinguish between different payments

Section 30. Interpretation of Division 3 Section 30(1)(a) a public company; or Section 30(1)(b) a private company or company limited by guarantee that is a subsidiary of a public company; Section 30(1)(a) any loan, quasi-loan or credit transaction; or Section 30(1)(b) any guarantee or security in connection with any loan, quasi-loan or credit transaction. Section 30(2) In this Division, a reference to a subsidiary undertaking of a company, in relation to a transaction, is a reference to such an undertaking at the end of the company's financial year, whether or not it was in fact a subsidiary undertaking of the company on the date of the transaction. Section 30(3)(a) any arrangement under which the loan or quasi-loan is made or the credit transaction is entered into, or under which the guarantee is given or security is provided; and Section 30(3)(b) any arrangement for an assignment or assumption of any rights, obligations or liabilities under the loan, quasi-loan or credit transaction or under the guarantee or security. Section 30(4)(a) in the case of a loan or quasi-loan, or a guarantee or security in connection with a loan or quasi-loan, is a reference to the director, controlled...

Section 31. Application of Division 3 Section 31(1)(a) was entered into during a particular financial year; or Section 31(1)(b) subsisted at any time during that year. Section 31(2) This Division applies whether or not the transaction is prohibited under Division 5 of Part IX of the Act.

Section 32. Information to be included in notes to company's financial statements Section 32(1) The information about loans, quasi-loans and other dealings in favour of directors, their controlled bodies corporate and their connected entities prescribed by paragraph (2) is required to be included in the notes to the financial statements of a company for a financial year. Section 32(2)(a) a director of the company or of its holding company; Section 32(2)(a)(i) a director of the company or of its holding company; Section 32(2)(a)(ii) a controlled body corporate of such a director; or Section 32(2)(a)(iii) in the case of a specified company, a connected entity of such a director; and Section 32(2)(b) the particulars of any transaction entered into by a subsidiary undertaking of the company for a person who at any time during the financial year was a director of the company. Section 32(3)(a) if the person was a controlled body corporate of a director of the company or of its holding company, the name of that director; or Section 32(3)(a)(i) if the person was a controlled body corporate of a director of the company or of its holding company, the name of that director; or Section 32(3)(a...

Section 33. Provisions for statement instead of information prescribed by regulation 32 Section 33(1)(a) the particulars specified in regulation 32(3)(b) in respect of a quasi-loan or credit transaction; and Section 33(1)(b) the particulars specified in regulation 32(3)(c) in respect of a guarantee or security in connection with a quasi-loan or credit transaction. Section 33(2)(a) the aggregate of the amounts outstanding referred to in regulation 32(3)(b)(ii) on those quasi-loans and credit transactions; Section 33(2)(a)(i) the aggregate of the amounts outstanding referred to in regulation 32(3)(b)(ii) on those quasi-loans and credit transactions; Section 33(2)(a)(ii) the aggregate of the amounts outstanding referred to in regulation 32(3)(b)(iii) on those quasi-loans and credit transactions; Section 33(2)(a)(iii) the aggregate of the amounts referred to in regulation 32(3)(b)(v) in respect of those quasi-loans and credit transactions; and Section 33(2)(a)(iv) the aggregate of the amounts of provision referred to in regulation 32(3)(b)(vi) in respect of those quasi-loans and credit transactions; and Section 33(2)(b) the aggregate of the amounts representing the maximum liability re...

Section 34. Provisions applicable to company that is, or if its subsidiary undertaking, is a bank Section 34(1) If a company is a bank, the notes to the financial statement of the company for a financial year are required to include a statement showing the amounts calculated in accordance with paragraph (2). Section 34(2)(a) a director of the company or of its holding company; Section 34(2)(a)(i) a director of the company or of its holding company; Section 34(2)(a)(ii) a controlled body corporate of such a director; or Section 34(2)(a)(iii) in the case of a specified company, a connected entity of such a director; and Section 34(2)(b) the amount representing the maximum liability that may be incurred under all guarantees given, and all security provided, by the company in connection with all loans and quasi-loans made to and all credit transactions entered into for, the persons referred to in subparagraph (a). Section 34(3) If, at different times during the financial year, the aggregates of the amounts referred to in paragraph (2)(a) and (b) are different), the amount to be shown in the notes to the company's statement is the greater of those aggregates. Section 34(4) If a subsidia...

Section 35. Exemption for employee Section the value of the loan, quasi-loan or credit transaction does not exceed KSh 1,000,000;

Section 36. How to determine value of transaction

Section 37. Application of Division 4 Section was entered into during a particular financial year; or

Section 38. Information about material interests of directors in transactions, arrangements or contracts Section 38(1) The information prescribed by paragraph (2) about material interests of directors in transactions, arrangements or contracts entered into by a company is information required to be included in the notes to the financial statement of the company for a financial year. Section 38(2)(a) entered into by the company; and Section 38(2)(b) in which a person who at any time during the financial year was a director of the company had, directly or indirectly, a material interest. Section 38(3)(a) the principal terms of the transaction, arrangement or contract; Section 38(3)(b) a statement of the fact that the transaction, arrangement or contract was entered into or subsisted during the financial year; Section 38(3)(c) the names of the parties to the transaction, arrangement or contract; Section 38(3)(d) the name of the director having the material interest and the nature of that interest; and Section 38(3)(e) if that director is treated as having the material interest because of paragraph (4), the name of the director's connected entity and the nature of the connection. Secti...

Section 39. Exemption under Division 4

Section 40. Provisions protecting directors from liability Section A non-contractual document to which a company is a party is a document prescribed for the purpose of section 194(1)(c) of the Act if it contains provisions purporting to exempt a director of the company from any liability that would otherwise attach to the director in connection with any negligence, default, breach of duty or breach of trust in relation to the company.

Section 41. Interpretation: Part VI Section a parent company of the company;

Section 42. Directors' report to include details of directors' interests Section 42(1)(a) to which the company or a specified undertaking of the company is a party; and Section 42(1)(b) whose objects are, or one of whose objects is, to enable directors of the company to acquire benefits by means of the acquisition of shares in, or debentures of, the company or any other body corporate. Section 42(2)(a) to which the company or a specified undertaking of the company was a party; and Section 42(2)(b) whose objects were, or one of whose objects was, to enable directors of the company to acquire benefits by means of the acquisition of shares in, or debentures of, the company or any other body corporate. Section 42(3)(a) to explain the effect of the arrangements referred to in paragraph (1) or (2); and Section 42(3)(b) to give the names of the persons who at any time in that financial year were directors of the company and held, or whose nominees held, shares or debentures acquired under the arrangements. Section 42(4) Paragraphs (1) and (2) do not apply in respect of a company that falls within the reporting exemption for the financial year.

Section 43. Directors' report to give details of certain donations made by company Section 43(1)(a) has no subsidiary undertakings; and Section 43(1)(b) has in a financial year made donations for charitable or other purposes to a total amount of not less than KSh100,000, Section 43(2)(a) a company (not being the wholly owned subsidiary of a company incorporated in Kenya) has subsidiary undertakings; and Section 43(2)(b) the company has in a financial year made donations (whether on its own or by its subsidiary undertakings) for charitable or other purposes to a total amount of not less than KSh100,000, Section 43(3) Paragraphs (1) and (2) do not apply in respect of a company that falls within the reporting exemption for the financial year. Section 43(4)(a) that other body corporate; Section 43(4)(b) a wholly owned subsidiary of that other body corporate; Section 43(4)(c) a nominee of that other body corporate or such a wholly owned subsidiary.

Section 44. Shares issued by company during financial year Section the reason for making the issue;

Section 45. Debentures issued by company during financial year Section the reason for making the issue;

Section 46. Equity-linked agreements Section 46(1)(a) the reason for entering into the agreement; Section 46(1)(b) the conditions that are required to be met before the company issues any shares; Section 46(1)(b)(i) the conditions that are required to be met before the company issues any shares; Section 46(1)(b)(ii) the conditions that is required to be met before a third party may require the company to issue any shares; and Section 46(1)(b)(iii) any monetary or other consideration that the company has received or will receive under the agreement; Section 46(1)(c) the classes of shares issued under the agreement; and Section 46(1)(d) for each class of shares, the number of shares that have been issued under the agreement. Section 46(2)(a) the classes of shares that may be issued under the agreement; Section 46(2)(b) for each class of shares, the number of shares that may be issued under the agreement; Section 46(2)(c) any monetary or other consideration that the company has received or will receive under the agreement; and Section 46(2)(d) any other conditions or terms that remain to be met before the shares are issued. Section 46(3)(a) an agreement that will or may result in the...

Section 47. Dividend recommended by directors Section A directors' report for a financial year is required to state the amount (if any) that the directors of the company recommend should be paid by way of dividend for the financial year.