The Anti-Money Laundering and Combating Terrorism Financing Laws (Amendment) Act of was assented to on 1 September 2023 and came into effect on 15 September 2023. The Amended Act requires foreigners to have either a local director or a company secretary when incorporating a company in Kenya.
Previously, foreigners could establish a corporation as sole directors and shareholders.
The Act has been implemented to enhance regulatory compliance to mitigate the potential misuse of corporate entities for money laundering and terrorism funding activities. The inclusion of a local director or company secretary provides authorities with a reliable point of contact familiar with the local business environment, facilitating easier monitoring and oversight of the actions of the incorporated.
The Amendment Act is applicable to firms with a capital share below Kenya Shillings Five Million (KES 5,000,000). The legislation also impacts foreigners who have already established enterprises in Kenya as sole directors. Such individuals are mandated to include a company secretary or a local director in their companies by submitting a notice to the Registrar of Companies within sixty days of the law’s enactment, which occurred on 15 November 2023.
Failure to adhere to this requirement and notify the registrar within the stipulated timeframe is considered an infringement, carrying a penalty of up to Kenya Shillings Five Hundred Thousand (KES 500,000).
--
Read the original publication at Matthew & Partners
