Proposed Provision for Amendment | Proposed Amendment | Our Comments |
2 | a) Including the following definitions:
b) Providing that a “minor” means a person who has not attained the age of 18 c) deleting the definition of the term “foreign concern” d) deleting the definition of the term “Registrar” and substituting therefore the following new definition; e) Requiring all persons, when submitting their particulars under the Act, to also submit the particulars of f) deleting subsection (3), which does not require the disclosure of name changes of individuals before they |
If passed, the proposed definitions would provide some much-needed clarity when it comes to the interpretation of these terms under the Act. As the Act commenced on 29th September 1951, it is expected that its provisions might be out of line with legal and other developments, which requires them to be updated. For example, an amendment to the meaning of the word “minor” is overdue.An amendment to redefine the term “Registrar” is similar to the amendment proposed in the Movable Property Securities (Amendment) Bill, 2021 and is an effort to bring most matters to do with business registration and regulation in the purview of one public office. As Kenyans no longer consider themselves British subjects, the requirement for only such persons to disclose
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3 | The Bill proposes to have the Deputy Registrar and every Assistant Registrar appointed pursuant to section 831(3) of the Companies Act be the Deputy and Assistant Registrars of Business Names. The Registrar is obliged to keep and maintain a register in the prescribed manner, in which shall be entered the particulars required under the Act. |
This is an effort to streamline and centralise services related to business entities to make them effective and avoid duplication of similar roles by having one body serve this purpose. |
4 | a) The Bill proposes to delete all references to “firm individuals and corporations” and substitute them with “proprietors” in the section.
b) Delete the word “administrative receiver” immediately after the term “administrative”. |
Replacing the words “firm individuals and corporations” with the term “proprietors|” is a means of providing clarity as this term is defined in the proposed amendment of section 2. Further, firm individuals and corporations may refer to artificial persons yet there is a shift towards identifying the natural persons who own business entities. The proposed amendment is in line with that policy.There is no mention of “administrative receiver” in section 4. |
5 | The Bill proposes to delete section 5, which provides for registration by nominees i.e., that if a nominee or trustee wholly or mainly carries on business for firms, individuals or corporations with a place of business within Kenya or act as general agents of any foreign firm, the business is to be registered under the Act. The section also exempts businesses carried on by a trustee in bankruptcy or a receiver manager appointed by any court from having to register under the Act. |
Persons carrying out business in Kenya are required to be registered under the Act in any case, hence deleting this section would rid the Act of unnecessary sections. |
6 | The Bill proposes to delete and substitute section 6 with another new section setting out the particulars that proprietors under the Act are to submit when seeking to register their business. The particulars are:
If the business is carried on under two or more business names, each of those business names are to be stated. On receipt of a statement of particulars, the Registrar is to enter the firm, individual or corporation in the |
The proposed particulars are clearer as compared to those currently in the Act. The particulars also indicate favouring increased disclosure for businesses. This is to ensure accountability for the actions of business proprietors. For example, the requirement for a concise description of the true nature of the business to be carried on in the business name is currently phrased as a requirement to disclose the general nature of the business under the Act. |
6A | The Bill proposes to clothe the Registrar with the power to require any document to be lodged or issued electronically under the Act. The Registrar may allow the document to be lodged by an agent of the person required to lodge it, subject to any conditions that the Registrar may impose from time to time.A copy of a document lodged electronically with the Registrar purported to be certified by the Registrar as a true copy of the original document is, in the absence of evidence to the contrary, admissible in all legal proceedings as proof of the original document. |
This would give legitimacy to documents lodged electronically with the Registrar, hence avoiding the need to subject them to strict proof. This is also an indication that electronic documents are increasingly being recognized as legitimate documents. |
8 | Deletion and substitution.
The Bill proposes to allow for the registration of a Business Name after a business has commenced and further |
The current section 8 provides for furnishing of all statements of particulars under the Act within twenty-eight |
9 | The Bill proposes that if a change is made or occurs in any of the particulars registered in respect of any proprietor of a business or of the business, that proprietor or the person responsible for the business shall submit to the Registrar in the prescribed form the particulars of the change within 30 days after the change occurs.The relevant particulars may include a change in the general nature of a business; addition or removal of a proprietor; name of a business; or address of the proprietor or of the principal place of the business or any other place where the business is carried out. The Bill also proposes to authorise the Registrar to request for particulars from individuals or their Once the application for the change of particulars of a business name are approved, the Registrar shall issue a |
The amendment, if passed, would give business proprietors an additional two days to comply with the registration requirement as compliance is currently required within 28 days.The increased disclosures are indicative of a move toward business transparency in Kenya, more so when it comes to the identity of the proprietors of a business. There also seems to be a need to increase the veracity of particulars asserted through request of particulars or It is not clear what happens after an existing certificate of registration is cancelled. Would it mean that the
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10 | The Bill proposes to make it an offence to fail to furnish a statement of particulars for a notice of any change in particulars without reasonable excuse in the manner and within the time specified. The sanction is KES 20,000 or the Court shall order a statement of the required particulars or notice of the change in particulars to be furnished to the Registrar within such time as may be specified in the order or to both.Where a person submits particulars that they know is false or authorizes or permits the submission to the Registrar such a statement commits an offence and on conviction is liable to a fine of KES 100,000 or to imprisonment for a term of three years, or to both. |
The use of the word “for” seems to be the result of a grammatical error, since the word “or” would make better sense of the clause.The threatened sanctions are intended to act as deterrents of non-compliance. This proposed amendment provides harsher sanctions for failure to comply compared to the current provision in the Act, which imposes a court order requiring compliance from the defaulter as may be specified in the order. Perhaps this sanction was not as effective at ensuring compliance and strenuous measures are needed. |
12 | Deletion and substitution.
The Bill proposes to impose penalties for signing or submitting to the Registrar a statement or particulars made |
This would be an enhancement of the penalty for making false statements, which is currently an imprisonment for |
13 | Deletion.
The section provides for the Registrar’s power to require an individual to furnish him or her with particulars |
The proposed amendment is acceptable since more comprehensive provisions on the power of the Registrar to |
14 | Deletion of subsection (2)
Amendment of subsection (3) The Bill proposes to remove the requirement of the Registrar to issue a fresh certificate in the prescribed form The Act requires persons of all nationalities other than those of British nationality from indicating their The Act requires the minority of minors to be shown on the certificate the Registrar issues. The Bill proposes |
The Bill proposes to have the Registrar under its proposed section 9 to issue a certificate of change of The removal of the two latter exceptions is to avoid discrimination, which is not permitted under Article 27 of |
14A | Insertion
The Bill proposes to enhance the effect of registration of a business to include the entitlement of every person Further, a certificate of registration or a certified copy of any entry in the register in respect of any |
This proposal increases the value of registering one’s business in that it includes all persons whose business Giving prima facie high probative value to certificates of registration or certified copy of entries in the |
14B |
Insertion
The registration of a business name is proposed to remain in force for a period of three years, but the Upon the expiry of three years from the date of registration or last renewal of a Business Name, the Business If a person is aggrieved by a decision of the Registrar, they may appeal to a court of competent jurisdiction. |
These consequences are geared at ensuring compliance on the part of the proprietors of a business. They also |
15(3) |
Section 15(3) of the Act provides for a period of twelve weeks within which a firm, individual or corporation must respond to the Registrar’s notice to confirm whether they are still in business. The Bill proposes to change this period to three months. |
This amendment does not seem to introduce any substantive change given that three months is equivalent to twelve weeks. |
15A |
Insertion
The Bill proposes a reprieve for persons whose registration has been cancelled. This is through an application An application may be made even if the business has in consequence been dissolved. It is to be made only by a |
Given the automatic consequence of being struck off the register for failing to make the requisite statement and It is also interesting to note that this option is available for businesses that have since been dissolved. This |
17 | Deletion and substitution
The Bill proposes to prohibit the registration of a business name if the use of the name would constitute an |
This proposed deletion and replacement of section 17 would ensure that there is more discretion on the part of |
17A | Insertion
The approval of the Registrar is required where the name of a company to be registered under the Act |
Limiting this to companies only is curious at best but generally seems to be an oversight on the part of the |
17B | Insertion.
The Registrar may require an applicant in who proposes to use a business name that resembles that of a public |
The aim is to prevent business entities or individuals from using names that may result in confusion between |
17C |
Insertion
The proposed section provides that the regulations may permit or prohibit the use of certain characters, signs The regulations may specify a standard style format for the name of a business for the purpose of registration. The regulations may also prohibit the use of specified characters, signs or symbols when appearing in specified The Registrar may not register a company by a name that consists of or includes anything not permitted in |
This provision gives the Registrar some discretion in deciding what names are acceptable and which are not, |
17D | Insertion
The Registrar may refuse to register a business if:
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These provide adequate guidelines for business owners seeking to register the names of their business. Further, |
17E |
Insertion
The Bill proposes to empower the Registrar to direct a change of a business name in writing where it has been The Registrar is to specify the period within which the business would be required to comply with the direction. |
The proposed amendment would give the Registrar discretion to decide the question of the appropriateness of a |
Presumably 17F | The proposed amendment is not numbered.
If a proprietor is dissatisfied with the Registrar’s direction to change its name in case of a similarity, they |
The proposed amendment should be numbered.
If passed, this would give business proprietors recourse to court in case of an unreasonable exercise of |
23 | Deletion of subsections (2) and (3)
The Act requires the publication of the true names of every individual, including, in the case of a married |
These discriminatory provisions are not adhered to in practice, and it is time that the Act catches up with the |
25 | Deletion and substitution with a new section 25
The Bill proposes to provide for a general penalty for when an offence is committed, and a person is found |
The Act currently prescribes a fine not exceeding KES 1,000 and in default of payment, an imprisonment term not |
26 |
Deletion
The Bill proposes to delete the section that provides for the jurisdiction of subordinate courts of the first |
The Magistrates Court Act, 2012 provides for a different classification of the Magistrates Courts as well as |