Licensing and Regulatory Reforms and Other Kenya Business Reforms

The current Kenya Business Reforms are said to be the best Business Friendly Regulatory Reforms in Africa. This leads to a conducive environment for making business in Kenya.

An overview on Licensing and Regulatory Reforms and Other Kenya Business Reforms

A new investment law superseding the investment promotion centre act of 2006 which it repealed was passed by parliament and assented by the president in December 2004.

Called the Investment Promotion Act, 2004 came into force in the Kenya gazette supplement no. 87 of January 2005.

The purpose of the act is to "Promote and facilitate investment by assisting investors in obtaining the licenses necessary to invest and providing other assistance and incentives"

The government recently set up a task force for public consultation on business licensing reforms to seek public comments on the 1,300+ licenses affecting business operations in Kenya.

The growth and competitiveness of the private sector is negatively affected by the onerous business licenses. This has adversely affected economic growth and the creation of job opportunities in Kenya.

Consequently, the Government decided to use the regulatory guillotine so as to rapidly delete or simplify those licenses which are illegal, unnecessary or business unfriendly.

The licenses which are necessary from a health, environment or safety perspective will be simplified if they are business unfriendly.The objective of the reform is to substantially reduce the number of licensing requirements in Kenya and, by doing so, to make the licensing regimes more simple and transparent, and focused on legitimate regulatory purposes.

A Working Committee has completed Phase I of the business licensing reforms under the original terms of reference (edition February, 2005). This included the review of 86 licenses which impact on business.

The Government eliminated 35 licenses and simplified 4 others excluding the double counting arising out of simplification and consolidation of licenses.

The Working Committee is now required to apply the guillotine strategy to the remaining licences which impact on business activity in Kenya.

The Committee is now required to review an estimated 514 licenses, establish a permanent electronic registry for licenses at the Attorney-General’s office in Kenya and also to put in place a mechanism for quality review of licenses in future.

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