winding up a Limited company in Kenya.
To Wind down your Company or to shut down, De-register or dissolve a limited Company in Kenya involves officially closing a company, ceasing operations, and removing it from the Company Register.
A company may voluntarily wind up for any of several reasons including
Why to Deregister up a company in Kenya.
- Termination of the Business of the company
- Completion of business for which the company was registered
- Company ceasing to carry on Business for whatever reason
- Company running into losses and becomes unsustainable
- Changes in Business environment.
- Changes in laws and compliance requirements
- ETC
Process of winding up or Deregistration of a company in Kenya.
A company in Kenya may wind up or dissolve in the following ways.
- By Court
- Voluntary: By a resolution of the Directors and shareholders of a company.
- By Creditors: Subject to supervision of the Court
We offer Voluntary Winding up services for Private Owned companies all over Kenya.
How to De-register a Limited Company in Kenya.
- The company convenes a Special board meeting of directors and shareholders and pass a resolution to dissolve the company.
- An application is made to the registrar of companies via
- A cover letter addressed to the registrar of companies conveying the intention to wind up the company and the reasons
- CR 19 Notice of Special resolution.
- CR 18 Application to Strike off the company name from the register of companies.
- Minutes of the resolutions meeting.
. The details in the form should be stating the reasons that the company is shutting down its business affairs.
- An application in Writing is made to the Registrar of Companies, Stating the intention of the company to Wind up its affairs.
- After submission the application is reviewed by the registrar for verification.
- Once approved the dissolution of the company is published in the Kenya Gazette to show the intending a dissolution. The notice takes 3 months. This is so that any objections, claims that the business owes to creditors are settled.
- Where no objections or claims are made in the 3 months, the registrar shall proceeds to strike the company from register of Companies in Kenya.
- Copies of all outstanding company annual returns must be paid and up-to date.
- Where the Registrar is satisfied with the application. The registrar shall cause the application to be published in the Kenya Gazette for a period of 3 months.
- The company shall be struck off from the Register of Companies.
Requirements for Dissolution of a Limited company in Kenya.
The following are the requirements for winding up of a limited liability company in Kenya,
- Special Resolution
- Minutes to the Resolution.
- Company Annual returns.
- Clearance from all Charges, debentures, mortgages and chattels of the company.
- Written application.
Notice About the Deregistration in Kenya.
Under Section 900 of the companies Act, The directors and shareholder of a company, who make the application for dissolutions, must, within 7 days of filing the application with the registrar, notify the following persons:
- All shareholders of the company.
- All Creditors such as banks, suppliers, former employees if the company owes them money, landlords, tenants, guarantors and personal injury claimants.
- Employees of the company.
- Managers or trustees of any employee pension fund.
- Any directors who have not signed forms (CR 18, ‘application by the company to have its name struck off the register’) and Form CR 19 (, ‘Ordinary or special resolution form’).
- A person of a class prescribed by the Regulations to strike off
- The company’s directors must also send a copy of the application to any person who, after the application has been made, becomes a director, member, creditor or employee of the company, or a manager or trustee of any employee pension fund of the company.
FAQs - Deregistration of Company in Kenya: Frequently Asked Questions
After an application for winding up is made and the notice published in the Kenya gazette for three months, the name of the company will be struck off the Register and the company will be dissolved. The Deregistration or winding up of a limited company in Kenya typically takes and average of 6 months.
The official cost of winding up a company in Kenya is Kes 4050. However, there may be costs for filing of all outstanding annual returns before the company Deregistration process may commence.
No, a dormant company that has ceased operations does not need to be deregistered. However, remaining dormant requires compliance with filing annual returns to avoid penalties. Deregistration is recommended if the company has stopped all operations.
Once a company is deregistered, directors are generally not personally liable for company debts unless there was fraud, negligence, or misconduct involved. However, directors are responsible for ensuring all liabilities are settled before deregistration
There are two main types of company dissolution in Kenya:
- Voluntary Dissolution: Initiated by the shareholders or directors through a special resolution.
- Involuntary Dissolution: Initiated by the Registrar of Companies or a court due to non-compliance with legal obligations or debtors.
No, it is not mandatory to hire a lawyer, consulting one is advisable, especially if the dissolution process involves complex legal or financial issues. A lawyer can ensure that all requirements are met and help navigate potential challenges.
Biz Brokers Kenya can provide guidance and assistance with your company dissolution procedures.
Company Dissolution in Kenya.