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Debt Acknowledgement Kenya Nairobi
Legal Guide to Debt Acknowledgement Agreements in Kenya

In all instances, a secured creditor will first try to recover the movable property pledged as security for a loan (security property) using the debt recovery services of a debt recovery agency such as a licensed auctioneer to seize and sell the security property; and use the proceeds from sale of the collateralised movable property to satisfy the debt owed to such secured creditor.  The secured creditor may subsequently refer debt recovery to a business attorney/ business law firm to institute a court action for debt recovery ...

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Debt Collection on Death of Borrower Nairobi Kenya

Death does not discharge debts of a debtor and debts owing to creditors are payable ahead of bequests or inheritance of the estate by heirs of the deceased debtor.  Where a debtor dies and any amount of an owed debt is still outstanding, the creditor once he knows of the death shall inform the family and next of kin that they were a creditor of the deceased and the extent of indebtedness of the deceased. If the debt was secured, the creditor will inform the next of kin of the creditor’s right of lien and where acceptable to both parties, the creditor can give the debtor’s personal representatives some time to repay the debt or before the creditor enforces their security rights over the security property in question...

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Company Registration in Kenya Commercial Law Firm
Incorporation of Companies in Kenya

Companies in Kenya may be registered as public or private companies. A private company may be limited by shares and guarantee. Additionally, persons may also incorporate a private unlimited company in which the liability of members for the debts of the company is unlimited. The Companies Act of Kenya (No 17 of 2015) defines a private company limited by shares as one where a shareholder’s liability is limited by the amount unpaid on the shares held by the member. This means that the extent of a shareholder’s liability is limited to only their portion of the unpaid capital. This type of company is favoured by promoters seeking to do business in Kenya and indeed is the most common type of company incorporated in Kenya...

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Corporate Taxes Kenya
Corporate Taxes in Kenya

Businesses operating in Kenya are obliged to pay various taxes as set out in: the VAT Act of 2013; the Income Tax Act, (Cap 470); and other relevant tax acts such as the Excise Duty Act and the Stamp Duty Act. Additionally, not all companies are subject to pay the same taxes hence the need for proper legal taxation advice depending on the particular circumstances of each company...

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Immigration Work Permit Requirements Kenya
Immigration Work Permit Needed by a Foreigner Starting a Business in Kenya

A foreigner investing in Kenya and starting a business in Kenya needs to obtain an immigration permit to operate their business here in Kenya. This will allow them to reside in Kenya and carry out the specified business. There are various classes of permits under the Kenya Immigration and Citizenship Act of 2011 and this article will outline the steps to get an Investor Permit which is a Class G permit as well as other investor permits for specified industries like mining, agriculture and manufacturing.... 

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Law suit for debt recovery
When to Institute a Debt Recovery Suit - Secured Creditors (Movable Property)

In all instances, a secured creditor will first try to recover the movable property pledged as security for a loan (security property) using the debt recovery services of a debt recovery agency such as a licensed auctioneer to seize and sell the security property; and use the proceeds from sale of the collateralised movable property to satisfy the debt owed to such secured creditor.  The secured creditor may subsequently refer debt recovery to a business attorney/ business law firm to institute a court action for debt recovery ...

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Interim Protective Relief Arbitration Rule
Mode of Approaching Court for Interim Protective Relief when Actuating the Arbitration Clause

Previously, many parties seeking relief under Section 7 would go before the court by way of a naked Notice of Motion Application filed under a Miscellaneous Application not rooted in a suit. In this precedent setting case, the Court of Appeal of Kenya set out the proper instrument to be used to commence an application for interim measures of protection pending reference of a dispute to arbitration or during the progress of arbitral proceedings...

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Law on Auctioneers and Debt Collectors
Alternative Remedies: Use an Auctioneer to Enforce Security Rights under the Movable Property Security Rights Act

Kenya has debt collection agencies whose operations are governed by the Auctioneer’s Act. A secured creditor may appoint a debt collector (licensed auctioneer) after exhausting the normal debt collection procedures through attempts at amicable agreement on payment of the debt; i.e., where the secured creditor and the debtor have not come to an agreement on repayment of the outstanding debt after issuance of a statutory notice of default as required under the law...

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Conflict of Courts Kenya law of contracts
‘Conflict of Courts’ Kenya: Don’t Let your Contractual Choice of Jurisdiction or Law, Let you Down

A party needs to be very careful when choosing the courts of a foreign jurisdiction in a contract that a party may seek to enforce in Kenya - this is because there is no overarching international law on reciprocal enforcement of court judgements as there is for arbitration.  Kenya only enforces judgements from the few countries listed in the Recognition and Enforcement of Foreign Judgements Act...

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Contemporaneous payment of stamp duty and CGT forced sale
Modalities of the Payment of Stamp Duty in the Forced Sale of Land (Foreclosure) upon Loan Default by Land Owner

Insight into a judicial review action seeking a declaration  that the KRA notice that mandated the contemporaneous payment of stamp duty and capital gains tax (CGT) was unfair, unreasonable and erroneous. The action was predicated on the grounds that this was conflating two separate taxes and burdening banks as Chargees...

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Doing Business in Kenya Foreigners
Lawyer's Checklist: Why Foreigners CAN Direct Foreign Investment to Kenya without Worrying about Foreign Ownership Rules

Foreigners are allowed to own property in Kenya subject to certain legal constraints. Foreign direct investment is encouraged, thus foreigners can take advantage of the business opportunities in Kenya - an emerging economy. Article 40 of the Constitution of Kenya (2010) enshrines the protection of every person’s right to own and hold property in Kenya irrespective of citizenship...

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Registration of LLP in Kenya
The Operation of a Limited Liability Partnership (‘LLP’) in Kenya

An LLP combines the advantage of a simple partnership (one of which is flow through of taxes and no corporate taxation) and the advantage of a company (of limited liability of the incorporated entity). This article outlines the legal set-up and operations of an LLP...

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Loan collateral in Kenya, law firm in Nairobi, Kenya
alternative collateral to secure a loan

In Kenya, various lending institutions have various thresholds for what is acceptable collateral for the credit they offer based on the principles that valuable collateral is...

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Venture Capital Legal Advisory on African PEP Shareholders
Venture Capital: Legal Advisory on PEP Shareholders - Africa

Politically Exposed Persons (PEPs) present a significant and yet - mostly overlooked risk to investments made by investment fund managers and other investors. While PEP status does not predict criminality, in Africa, it often presents a distinct and further risk to investments due to the associations with corruption and other economic crimes...

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Administration of company corporate recovery Kenya
Administration of the Insolvent Company to aid Corporate Recovery

Administration is the process of putting a company under the management of a competent manager who can run the business as a going concern in order to aid business recovery of the insolvent company to a level where the company is no longer insolvent. The aim is to give creditors a better outcome in terms of the repayments they can recover which would likely be better as the company is still running to generate revenue to repay creditors...

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Corporate Liquidation by Court in Kenya
Corporate Liquidation by the Court in Kenya

This is a compulsory liquidation or winding up by the court and is often initiated by a creditor when the insolvent company fails to pay off liabilities owed to such a creditor...

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Corporate Insolvency Kenya Creditors Liquidation
Creditors' Liquidation - Insolvency

Creditors’ voluntary liquidation is one where creditors resolve to liquidate the company. It is also one where the liquidation started off as a members’ voluntary liquidation but is converted into a creditors’ liquidation because the directors cannot validly make a declaration of solvency of the company – which is a requirement in a members’ voluntary liquidation...

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Members Liquidation Corporate Insolvency Kenya
Corporate Insolvency in Kenya (Members' Liquidation)

This is a voluntary liquidation of the company whereby members resolve by a special resolution to liquidate the company voluntarily. After the resolution is passed...

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Breathing Room Moratorium Insolvency
breathing room for insolvent companies?

The moratorium is an opportunity for the company to make a voluntary arrangement with its creditors while protecting the company from its creditors by giving the firm's directors time to propose a restructuring/repayment plan to creditors... 

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Legal Guide for Electronic Contracts and Electronic Signatures in Kenya
Legal Guide to Electronic Contracts and Electronic Signatures in Kenya

Recently, in April 2020, Kenya enacted the Business Laws Amendment Act to buttress the KICA statute. This 2020 Amendment inter alia solidified and aligned the statutory provisions under KICA as pertains to electronic contracts and electronic signatures with other existing statutes relating to land; registration of documents and stamp duty as follows…

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Group of Companies Insolvency
Advantages of Incorporating a ‘Group Structure’ for Companies

The main advantage of a group structure is that it allows business owners to separate higher risk ventures within the same business from those that are more stable and profitable by placing them into separate companies... 

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Amendments to Employment Act of Kenya
alert to employers

We take a look at employment law changes of interest to Employers under the proposed Employment (Amendment Bill) 2019 which is currently under Parliamentary consideration...

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The provision of general advice herein does not constitute an advocate-client relationship with any reader. All information, content, and material in this article are for general informational purposes only. Readers of this article should get in touch with us to obtain advice with respect to any particular legal matter.