With globalisation being the norm and the world making it easier to take a business idea to the market, people with startup ideas and capital are trying out the lifestyle of an entrepreneur. While this is happening in most parts of the world, Kenya is no different, with their overall laws on starting and registering companies being quite manageable.

The first step for any entrepreneur is to introspect their business idea, needs and long term plans. They then have enough information to figure out the type of company they want to create. There are multiple options, sole proprietorship, private limited, a partnership among thers. Each of these with their purpose and requirements, both at the time of setting up and overall functioning. If these are not thought through in the beginning, they can lead to large expenses incurred later.

Are there any significant differences between Limited and Unlimited companies?

Limited companies have limited liabilities while unlimited companies have unlimited liabilities.

What this additionally means is that companies with unlimited liability have their members liable to pay debts if the company has to shut down. Although this is not a very common model of company registration, there are few exceptions where this happens. Some of them mentioned below.

• There is a small risk of insolvency.
• Limited Liability is not possible in the field of operation.
• There needs to be secrecy concerning financial affairs.
• The reductions in company capital might become desirable.

A limited company is an exact opposite, where directors or founders do not have to associate their assets with their company.

What is the first thing an entrepreneur has to do when planning to start up a company?

While the previous years saw the manual registration of businesses through the registrar of companies, the entire process can now be handled online. With the Kenyan Government simplifying the process, all an individual has to do is search of their company name and register it on the platform.

How to create an account for yourself on the eCitizen portal to register your company?

As a person interested in starting a company, you should have the following documents:

• National Social Security Fund (NSSF) card
• Kenya Revenue Authority (KRA) certificate
• National Hospital Insurance Fund (NHIF) membership
• National ID Card or passport
• Email address and phone number
• Soft copy of a passport-sized photo
• An internet connection
• Selected business name
• Company details and the names of directors
• Registration fees
• Functional payment method

How do you register a company?

The most common practice is to register limited companies in Kenya and these are generally done through the online portal. The process is quite simple and charges a small fee, paid at the end.

The steps to register a company are

• Search for the name of the company on their website.
• If the name exists, find a different one. The search might take about 24 hours and the process will continue, post that.
• Post the name selection, add the company details and information, including the type of company being registered.

What are some of the documents needed to register a company?

There aren’t a lot of documents but a lot of information has to be handled in.

• Director details
• Names of all the Directors depending on how many there are
• Occupation
• Postal address and residential address
• Share allocation in the form of percentages
• Proof of identification, which can include the National Identity
• Cards or Passports
• Photographs of the directors or founders.
• Company details
• Company name suggestions
• Type of business
• Address of the business premises

The following forms should be signed by all the Directors

• Form CR1 – Application Form for Company Registration
• Form CR2 – Memorandum
• Form CR8 – Notice of Residential Address of Director(s)
• Notice of Nominal Capital Share
• Certificate of Incorporation