Sub-Saharan Africa Country Reports


The International Journal
of Not-for-Profit Law

Volume 12, Issue 2, February 2010

Faith Kisinga Gitonga1


General Framework

Kenya’s historical antecedents can be traced to England. Though most of Kenya’s substantive laws are statutory in nature, the laws of torts, contracts, and agency largely follow England’s common law. Many statutes are merely codification of the older common law rules. But Kenyan courts are not always bound to follow or apply the rules of common law, doctrines of equity, and English statutes of general application. Instead, courts have discretion to examine the rules in the context of the local circumstances and determine whether to apply, modify or refrain from using them.2

The Judicature Act of Kenya3 sets out the formal sources of law in the country. They are:

      1. The Constitution.
      2. Statutory law or Acts of Parliament, including foreign laws named in the First Schedule of the Judicature Act.4 There are more than 500 local laws in Kenya. These comprise the largest proportion of laws in the country.5 The NGO Coordination Act of 1990, which regulates NGOs, is an Act of Parliament.
      3. Subsidiary legislation: These are laws formulated by those to whom Parliament has delegated the power or responsibility to make laws. They include orders, regulations, rules or by-laws: for example, the NGO Regulations of 1992.
      4. The substance of the common law, doctrines of equity, English Statutes of general application, and procedure and practice observed in courts in England until 12 August 1897.6
      5. African customary laws, including certain religious laws (Islamic and Hindu): In civil cases where one or more of the parties is governed or affected by customary law, the courts are to be guided by it on condition that it is not repugnant to justice and morality or inconsistent with any written law. The courts are also to “decide such cases in accordance with substantial justice, without undue regard to technicalities of procedure and without undue delay”7. Parties that seek to rely on customary laws in court must prove, by evidence, that they are relevant and that they are habitually observed and applied. Customary law is applicable in a number of areas, including the following: Land held under customary tenure, marriage, divorce, maintenance of children, dowry, matters affecting the status of women, widows, guardianship, custody, adoption, legitimacy of children, and succession.8

International law is also a source of law though it is not listed under the Judicature Act. One can therefore invoke treaties, especially international and regional instruments on human rights, in matters pertaining to human rights litigation.

According to the Constitution, Kenya is a unitary state. Although the doctrine of separation of powers is ingrained in the Constitution, the document vests many powers without effective checks and balances in the President and in the central government. There are six levels of government, namely sub-locational, locational, division, district, provincial and national.

While laws are generally accessible, there is a general lack of awareness and understanding of the law and its contents. The Government Printers is the official agency that provides printed copies of laws to the public for a fee. The laws are available in English, which is the official language in Kenya. Public libraries, which are few and concentrated mainly in large towns, also provide citizens with some of the most frequently used laws. One can find the laws in government offices. There have also been efforts to increase the accessibility of laws by citizens during the last decade, through internet sources. Official laws can now be found online.9 However, only citizens who are literate and have access to computers or live in towns with cyber cafes can benefit from online channels.

International Legal Context

The protection of the freedom of association is enshrined in Article 20 of the Universal Declaration of Human Rights (UDHR) of 1948. Article 20 states that everyone has the right to freedom of peaceful assembly and association. Kenya has ratified the UDHR.

Kenya is also a signatory to the Vienna Declaration of Human Rights, which calls for the protection and promotion of the freedoms of association, assembly, speech and thought. The country has also ratified the International Covenant of Civil and Political Rights (ICCPR). The Covenant states that every one shall have the right to freedom of association with others, including the rights to form and join trade unions for the protection of his/her interests.10
The Africa Charter on Human and People’s Rights (ACHPR), which Kenya has ratified, provides ‘Every individual shall have the right to free association provided that he abides by the law’.11

Kenya is a member of the East Africa Community. In Chapter 25 (Art. 127 – 129), the East Africa Community Treaty explicitly emphasizes the creation of an enabling environment in which civil society can operate. Art. 127 (4) provides: “The Secretary General shall provide the forum for consultations between the private sector, civil society organizations, other interest groups and appropriate institutions of the EAC.”

Constitutional Provisions

Kenya’s Constitution is the supreme law of the land from which other laws derive their validity. This means that where provisions in other laws are found to be inconsistent with those of the Constitution, they will be declared null and void and the Constitution’s provisions will prevail. A Bill of Rights is enshrined in the Constitution, which provides a whole range of fundamental rights and freedoms. The rights which are vital for civil society include the following:

  • Freedom of assembly and association with others;12
  • Freedom of thought, conscience, and religion; and
  • Freedom to hold opinions and expression without interference, and receive and impart information and ideas.

These rights and freedoms are contained in Sections 78 to 81 of the Constitution. However, they are subject to certain constitutional limitations. For example, the rights are subject to limitations imposed in the interests of defence, public safety, public order, public morality or public health; or reasonably required for the purpose of protecting the rights or freedoms of other persons.13 The limitations must be reasonably justifiable in a democratic society.14

Types of Organizations

The term “Civil Society Organization” (CSO) is used generally in Kenya to refer to the wide array of organizations that operate in the realm between the individual and the state and are formed to promote the interests of their members or the public good. The term “NGO” is used to specifically refer to public benefit entities that are registered by the NGO Coordination Board.15 Though NGOs are just a small part of the larger CSO sector, they are the most visible. Generally, there are two main types of CSOs, organizations for the public benefit (NGOs) and membership organizations. CSOs in Kenya are diverse and governed by a plethora of registration and regulation regimes. Available legal organizational forms of CSOs include:

  1. Non Governmental Organizations (NGOs). NGOs are registered by the NGO Coordination Board and governed by the NGO Coordination Act of 199016 and its Regulations of 1992. Section 2 of the Act defines NGOs as “private voluntary groupings of individuals or associations not operated for profit or for other commercial purposes but which have organized themselves nationally or internationally for the benefit of the public at large and for the promotion of social welfare, development, charity or research in the areas inclusive of, but not restricted to, health, relief, agriculture, education, industry, and the supply of amenities and services.” Some public benefit organizations which fit this definition are however registered under other legal frameworks including the Trustees (Perpetual Succession) Act (Chapter 164 of the Laws of Kenya), the Companies Act, (Cap.486, Laws of Kenya), the Societies Act, (Chapter 108, Laws of Kenya), or as community-based organizations with provincial administrations. Organizations registered as NGOs include local/indigenous NGOs and foreign NGOs17, as well as umbrella organizations, such as Health NGOs Network (HENNET), Kenya Human Rights Network (K-HURINET), and Peace and Development Network (PEACENET).
  2. Companies Limited by Guarantee and not having Share Capital. These CSOs are registered by the Registrar of Companies under the Companies Act.18 They can exist to promote any legal purpose as long as these are contained in the memorandum of association and articles of association. As but one example, many service delivery institutions – such as schools and healthcare organizations – are registered as companies limited by guarantee and having no share capital.
  3. Trusts and foundations are established by families, groups or individuals, to improve peoples’ well-being and to engage in mobilizing resources. Trusts are incorporated under the Trustees (Perpetual Succession) Act, Chapter 164 of the Laws of Kenya. Some trusts and foundations are also registered as companies limited by guarantee and not having share capital (under the Companies Act, Cap.486, Laws of Kenya) or through trust agreements under the Registration of Documents Act (Chapter 285, Laws of Kenya). Some international foundations operate under protocol arrangements with the Ministry of Foreign Affairs and sometimes under special agreements between the Kenyan Government and the government of the country where the parent foundation is registered; they are, however, required to apply for and obtain registration under the NGO Coordination Act.
  4. Societies and professional clubs and associations of ten or more persons are registered as societies under the Societies Act, Chapter 108, and are established to advance their members’ interests. Professional clubs and associations are mainly based in urban areas. After grassroots organizations, this is the second largest category of CSO: there are over 70,000 societies registered in Kenya.
  5. Cooperative societies and unions are registered at the Department of Cooperatives under the Cooperative Societies Act (Amended) 2004, No. 12 of 1997. They include consumer, producer and marketing cooperative societies in rural and urban areas and housing development societies found in major urban areas. They are voluntary membership organizations and advance the welfare, economic interests and goals of their members.
  6. Grassroots organizations include harambee or self-help groups and community-based organizations (CBOs) such as neighbourhood associations. Self-help groups and CBOs are formally recognized through registration under the Department of Social Services in the Ministry of Gender and Children Affairs. As the largest group in the CSO sector, they are operating primarily at the village and community level.


Permissible Purposes

The NGO Coordination Act states that NGOs may be established for the benefit of the public at large and for the promotion of social welfare, development, charity or research in the areas inclusive of, but not restricted to, health, relief, agriculture, education, industry, and the supply of amenities and services. Sessional Paper No. 1 of 2006, which is the National Policy for NGOs, describes NGO purposes as the following: “Enhancing the legitimate economic, social and/or cultural development or lobbying or advocating on issues of public interest or interest of a group of individuals or organizations.” Where it is deemed that the proposed activities or procedures of an applicant NGO are not in the national interest, registration may be refused.

Trusts may be established to promote religious, educational, literary, scientific, social or charitable, or athletic purposes.

Societies may be established for any purpose or object. The Registrar of Societies, however, will refuse to register a body that he has reason to believe will pursue any unlawful purpose or purposes prejudicial to or incompatible with the peace, welfare or good order in Kenya.

Cooperative societies and unions can be created for the promotion of the welfare and economic interests of their members.

Grassroots organizations exist to advance the interests of their members and the immediate needs of the local communities in which they operate.

In sum, in light of the range of legal organizational forms, individuals can form CSOs to pursue any legal purpose. The choice of organizational form is usually dictated by issues relating to the ease and speed of the registration process, or more generally by whether or not the rules and regulations governing a particular form are perceived to be crippling or supportive. The freedom to choose from the wide menu of organizational forms is often viewed as convenient by those seeking to register a CSO. The current situation, however, of multiple and overlapping governing acts and legal forms presents difficulties for the Government in developing harmonized, systematic and coordinated plans and approaches to civil society, as there is no cooperation and much duplication among the various regulatory agencies.

When the NGO Coordination Act was formulated, all CSOs meeting the definition of “NGO” were expected to register themselves with the NGO Coordination Board.19 However, since the Act was passed, many organizations that fit the definition of an NGO have been registered under alternative laws. Though the Act was envisaged as a tool to provide an overarching, enabling legal framework for all civil society organizations,20 there were few practical efforts to specifically encourage organizations to register and operate under the NGO Coordination Act. Instead, the other regulatory options remained available and some organizations have found it politically or functionally expedient to register under the other laws.

Registration as Voluntary vs Mandatory Requirement

A recent survey of the size, scope and financing of the non-profit sector in Kenya revealed that 90 percent of the non-profit organizations (NPOs) sampled were registered. Most of the organizations that are not ‘registered’ under a specific law were self-help groups or women and youth groups, which can be registered under administrative regulations of various government departments.21 Registered organizations receive the benefit, of course, of formal recognition. While self-help groups are encouraged to register, it is not a mandatory requirement. The regulations provide a straightforward method of registration, which most grassroots organizations find easy to use.

It is an offence, however, for any person to operate an NGO in Kenya without registration and a certificate under the NGO Coordination Act. While some NGOs are exempt from registration (for instance, those established by a state or group of states for welfare, research, relief, public health and other forms of development assistance), they must apply for exemption.

The Societies Act similarly provides that every society which is not a registered society or an exempted society is an unlawful society. Hence, where ten or more persons get together, they are expected, according to the law, to have that group registered. There are stiff penalties for operating as a society without a registration certificate. This legal provision is, however, rarely enforced.

Registration or Incorporation Requirements

1) NGOs

NGOs may be founded by individuals, whether citizens or foreigners, and by legal entities, including states. At least three persons are required to establish an NGO. The NGO Coordination Act requires three governing officers to sign the organization’s constitution.

  • Registration Requirements:An application for registration should be submitted to the executive director of the NGO Coordination Board.22 It must be signed by the chief officer of the applicant NGO and specify among other issues, the officers of the organization; the head office and postal address of the organization; the fields of the proposed activities; the districts, divisions and locations of the proposed activities; the proposed average annual budget; the duration of the activities; and all sources of funding.

Other documents required include:

  1. A completed name reservation form;
  2. Three copies of the applicant NGO’s Constitution, signed by three governing officers;
  3. Two recent photographs of three governing officers; and
  4. Processing fees of Ksh 11,000 for national NGOs and Ksh. 22,000 for international NGOs.There are no requirements for minimum assets or capital at the time of registration. While applications for NGO registration are often processed within about 90 days, the law does not explicitly provide a fixed time period within which the Board must act. The applications pass through the staff and board of the NGO Coordination Board and the National Security Intelligence Service (NSIS). Every certificate issued to an organization shall be valid for a period of sixty months from the date of issue.
    • Reasons for denial of registration:The Board may refuse registration of an applicant if it is satisfied that its proposed activities or procedures are not in the national interest; if it is satisfied that the applicant has given false information in its application; or if it is satisfied, on the recommendation of the NGO Council,23 that the applicant should not be registered. While the Board may sometimes furnish the applicant with an explanation for the refusal of registration, the Board is not legally required to do so. Moreover, the vague grounds provided in the Act for denial of registration may invite the exercise of excessive government discretion. For example, denial on the broad ground of the ‘national interest’ has been used unjustifiably to curtail the rights of NGOs.24


    • Appeal provision:Any organization which is aggrieved by a decision of the Board may, within 60 days from the date of the decision, appeal to the Minister. At the request of the Minister, the NGO Council shall provide written comments on any matter over which an appeal has been submitted to the Minister. The Minister shall issue a decision on the appeal within 30 days from the date of the appeal. Any organization aggrieved by the decision of the Minister may, within 28 days of receiving the written decision of the Minister, appeal to the High Court against that decision. In the case of such an appeal, the High Court may give such direction and orders as it deems fit, and the decision of the High Court shall be final.


  • Other Significant Constraints:The law is vague and ambiguous on a number of issues where wide discretion is given to the NGO Board and the Minister. For example, the certificate of registration may contain such terms and conditions as the NGO Coordination Board may prescribe.25 There are no guidelines, however, to ensure that the Board uses this prescriptive power in a clear, objective and predictable manner.

2) Trusts

Trusts may be founded by trustees who have been appointed or constituted to play that role. The number of founding trustees is determined by the constitution or trust deed of the trust. The law does not contain any minimum capital or asset requirements. Trustees may apply to the Minister of Lands for a certificate of incorporation of the trustees as a corporate body.26 In terms of general registration procedures, the application should be accompanied by the following, amongst other things:

  1. Application for registration of a certificate of incorporation (Form AI) in triplicate bearing adhesive revenue stamps in the value of Kshs.1,500;
  2. A certified copy of the trust deed, constitution or rules of the body;
  3. The names, addresses and occupations of the trustees;
  4. A certified copy of the resolution appointing the trustees; and
  5. A statement and short description of the land or interest in land that is possessed by, belonging to, or held on behalf of such body or association of persons.

A certificate of incorporation serves as conclusive evidence that all the preliminary requirements relating to incorporation have been complied with. However, incorporation may be subject to “such conditions or directions generally as the Minister thinks fit to insert in the certificate, and particularly relating to the qualifications and number of the trustees, their tenure and profession, the mode of appointing new trustees, the custody and use of the common seal, the amount of movable or immovable property which the trustees may hold, and the purposes for which that property may be applied.”27 Trustees may apply for variation of such conditions or directions and the Minister, if he is satisfied that it is proper to do so, may vary the conditions or directions.

The Trustee Act28 aims to ensure that the incorporation of trusts will not be used for the personal gain of the trustees. For example, it is required that the certificate of incorporation be registered against the title to any land already held on behalf of the body. Furthermore, the trustees shall not acquire or dispose of any movable or immovable property without the prior written consent of the Minister of Lands, and must comply with other existing rules and regulations on the acquisition and disposal of such properties. The Act makes the failure to provide information a punishable offense.

3) Societies

  • Registration Requirements:Application for registration or exemption from registration as a society must be made to the Registrar of Societies within 28 days of formation. A minimum of ten persons is required to establish a society. Applications for registration or exemption from registration must be accompanied by a fee of Ksh. 2,000. There are no requirements for minimum capital or assets at the time of registration. An application for registration must be processed within 120 days. 
  • Reasons for denial of registration:The Registrar has wide discretion to refuse to register a society if he has “reasonable cause to believe” that the society has among its objects, or is likely to pursue or be used for, any unlawful purpose or any purpose prejudicial to or incompatible with the peace, welfare or good order in Kenya, or that the interests of peace, welfare or good order in Kenya would otherwise be likely to suffer prejudice by registration of the society. The Registrar may also refuse to register a society where he is satisfied that such society is a branch of, or is affiliated to or connected with, any organization or association of a political nature established outside Kenya. Additional reasons for denial apply where the terms of the constitution or rules of the society or the name of the society is in any respect repugnant to or inconsistent with any law or is otherwise undesirable.
  • Appeal provision:Appeals against refusals can be lodged before the Minister of the relevant Ministry within 30 days of the refusal. The Minister shall consider and communicate his decision within 90 days of the appeal. Appeals against the Minister’s decision can be lodged in the High Court within 30 days of the decision.

4) Grassroots Organizations

Grassroots organizations are founded by individuals. Elected officials of the self-help group may, on a voluntary basis, meet with a local community development assistant or the district officer in charge of social development to formally request registration. There is no minimum number of founders or members required for registration. There are also no requirements for minimum capital or assets at the time of registration. To be registered, self-help groups are expected to submit an application letter, their constitution (with a clearly defined purpose or project), a list of members, evidence of local resource mobilization and detailed minutes of democratic elections. An application fee of between Ksh 1000 and 2000 is payable when the application forms are accepted. Non-compliance with these requirements can lead to denial of registration.

In practice, the registration process can take up to four weeks because all applications are approved by the district officer in charge of social development. In some cases, applicants may be asked to seek the consent of the local chief and district officer before their application for registration is finalized. The registration process is complete when the group receives a certificate of registration. The law requires self-help groups to renew their certificates every year.

CSO Registries

The NGO registry is located at the NGO Coordination Bureau of the NGO Coordination Board.

Any person may during working hours, and upon payment of the specified fee specified, inspect the registry and any documents relating to any registered NGO lodged with the Board, and may obtain from the Director of the Board a copy or extract of such register or document.

The NGO registry is published periodically, in accordance with the law.

The Registrar of Societies and the Registrar of Companies maintains a registry of societies and companies limited by guarantee, respectively, at the State Law offices. Given the restricted space where the registry is maintained, and the fact that information is still contained in physical files, inspection at the registry can be a tedious affair. Requests for information must be accompanied by the name and file number of the registered society. Requests to personally inspect the registry require payment of a fee of Ksh. 200, while Ksh. 300 and a letter are needed where an official search is sought.

The Attorney General’s Chambers and the Principal Registry of Documents at the Registration of Documents Department in Nairobi and Mombasa maintain the Registry for Trusts. Any person requiring information may apply in person at the Registry and, on payment of the prescribed fee, inspect the Registry.

The Department of Social Services maintains a registry of self-help groups in Nairobi. At the local level, the District Social Development Office maintains a register of self-help groups.

Foreign Organizations

Generally, requirements for foreign organizations seeking to register branch offices are similar to those of local organizations. They are, however, required to submit, along with their application for registration, a certificate of registration outside Kenya. They are also required to pay Ksh. 22,000 (approximately 295 USD) as an application fee.


Regulatory Authorities

NGOs: The NGO Coordination Board is a quasi-governmental agency established to streamline the registration, coordination and regulation of NGOs. The NGO Coordination Act of 1990 will be reviewed in line with the provisions of Sessional Paper No. 1 2006. The Policy states that all NGOs must reach agreement with the NGO Coordination Board on a variety of issues before commencing operations. The current terms and conditions for registration relate to issues of governance, areas of activity, submission of annual returns and tax exemptions. They are fairly reasonable conditions and NGOs have been largely agreeable to them.

Societies: The Societies Act gives wide discretion to the Registrar of Societies and sweeping powers to various government officials with respect to investigating, arresting, entering and searching the premises of any society. This is probably due to historical antecedents where the government was eager to curb and even eradicate groups that it considered a threat. Where societies fail to comply with requirements to provide annual accounts, membership lists or other information, they are liable to heavy penalties, including fines and imprisonment. The Act makes it an offence for a society to fail to keep a register of its members, their names, and the date of admission and exit. Where it is alleged that a society is an unlawful society, the burden of proving that it is a registered or exempted society or that it is not a society shall lie with the person charged. In practice, however, these powers are rarely exercised. Societies generally operate under minimum supervision. Only occasionally, where a group is suspected to be conducting illegal activities, have the provisions in this Act been put into effect.

Trusts: Generally, the court has regulatory powers over the operation of trusts.

Self-help groups: The District Social Development Office in every district has regulatory authority over self-help groups and CBOs. The Department of Social Development in the Ministry of Gender has overall regulatory authority and sets the general regulations and criteria for operation.

Internal Governance

The NGO Coordination Board and the NGO Council share responsibility for regulating NGOs. The NGO Board ensures that NGOs adhere to certain statutory requirements at the time of registration by specifically including information in their constitutions on their governance structure; the manner of amending their name, constitution and rules; and the dates for their general meetings. The NGO Council is a national umbrella body for NGOs. Once NGOs are registered by the NGO Board, they are required to apply for membership in the Council. The Council represents the interests of its members, provides them with essential services, and formulates policies on self-regulation for NGOs.

Indeed, the NGO sector has several mechanisms for self-regulation. The NGO Coordination Act does not establish mandatory rules or standards of internal governance, but rather defers to the self-regulatory mechanisms envisioned by the Act, which include the NGO Code of Conduct, the Regulatory Committee and the General Assembly of the NGO Council. Much of the Code of Conduct is devoted to describing how the standards will be enforced by the sector itself. According to the Code, the NGO Council can summon NGOs and other parties to appear before the Regulatory Committee. The Regulatory Committee is empowered to hear or dismiss complaints, issue warnings, recommend de-registration of NGOs and removal of NGO officials from office or from the Council, among other sanctions and penalties. However, the main limitation of this self-regulatory framework is that it is overwhelmingly reliant on the voluntary submission by NGOs to the self-regulatory mechanisms (i.e., the Regulatory Committee and the General Assembly). Such reliance has proved misplaced due to blatant disregard for the Code.

While emphasizing self-regulation, the NGO Coordination Act has failed to provide a practical framework for enforcement of the standards. For example, the Regulatory Committee, which is expected to convene periodically, has not sat as a tribunal for a long time. The Committee relies on volunteers and has yet to develop procedural guidelines for its operation. The decisions of the Regulatory Committee are subject to endorsement by a tribunal of over 3000 members of the Council’s General Assembly, but the legitimacy of the process is undermined by the absence of a neutral third party to provide checks and balances in cases where the self-regulatory mechanism fails.
The NGO Coordination Act provides for automatic membership of an NGO to the NGO Council, upon registration.29 However, the Council finds it difficult to check on the extent of member compliance with the rules and regulations or the Code of Conduct, given its limited capacity and the rapid growth of the sector. It is also powerless to penalize errant organizations.


The NGOs Regulations (1992)30 and the NGO Coordination Act of 199031 clearly state that NGOs must submit their annual returns to the NGO Coordination Board within three months of the end of their financial year, in the prescribed format of Form 14, which is set out in the schedule to the Regulations. Form 14 seeks information regarding finances (for instance, the amount expended on various institutional and project areas, as well as the amount spent on certain fields of activity), collaborating partners, and project and governance details. Expenditure or receipts exceeding Ksh. 1 million should be accompanied by audited accounts. Where any concerns about impropriety arise from an NGO’s annual return, a wide range of sanctions are available for use by the NGO Coordination Board including admonition, fines, and warnings, followed by suspension or cancellation of registration and prosecution.

State Enforcement and Sanctions

The Board has the power to investigate any complaints regarding an NGO. Through the Regulatory Committee, the Board can make recommendations for action, including dismissal of the complaint, admonishing the NGO, and suspending or cancelling its registration certificate. The Board can also freeze an NGO’s bank account. Where the Board believes that the registration of an NGO should be cancelled, it must notify the NGO of the proposed cancellation in prescribed format (Form 9). Grounds for cancellation are to be stated in the notification.

Dissolution, Winding Up and Liquidation of Assets

The NGO Regulations provide that an NGO should not voluntarily dissolve unless it has obtained prior consent in writing from the NGO Coordination Board. The NGO must present a written application seeking consent from the Director of the Board. The application should be signed by three of the governing officers of the NGO.32

The Companies Act set forth the procedure for voluntary and involuntary winding up of companies. Once a resolution for voluntary winding up is passed, a declaration of solvency must be made by the directors of the company. The provisions of the Companies Act address the distribution of property and powers and duties of a liquidator, and apply to every voluntary winding up. Involuntary winding up may be undertaken by the court or subject to the supervision of the court.

The Societies Act addresses the winding up of solvent and insolvent societies. In the case of solvent societies, the receiver prepares and submits a scheme for the disposal of the societies’ assets to the relevant Minister. Once the Minister approves the plan submitted to him, the receiver can proceed to distribute the assets accordingly.

Depending on where a CBO of self-help group operates, it may give notice to the District Officer in charge of social development in its district of its intended dissolution.


General Powers

Upon registration, CSOs acquire rights and powers like other legal entities with perpetual succession. They are capable of suing and being sued; taking, purchasing or otherwise acquiring, holding, charging or disposing of movable and immovable property; entering into contracts; and doing anything else that is permissible for a legal entity.

Expressive/Advocacy/Public Policy Activities

The political environment for CSOs has improved to some extent since 2003. The space for public participation in policy formulation and through the operation of political systems has been enlarged. Campaigns for the promulgation of the Access to Information Act are also underway and are crucial for the creation of an enabling environment for advocacy work. Generally, there are no legal barriers for CSOs to speak out or engage in advocacy efforts on any issues of public importance.

The definition of NGO under section 2 of the NGO Coordination Act is limited in terms of the scope of activities envisaged for NGOs. Advocacy and public policy activities are not expressly included. Nonetheless, Sessional Paper No. 1 provides for a broader definition, which includes organizations that lobby or advocate on issues of public interest. It is therefore envisioned that the new law will explicitly provide the space required for advocacy CSOs to register and operate.

Communication and Cooperation

The NGO Coordination Regulations provide that no NGO can become a branch of or affiliated to or connected with any organization or group of a political nature established outside Kenya, except with prior consent in writing of the Board, obtained upon written application addressed to the Director and signed by three officers of the NGO. Where an NGO fails to do so, it is guilty of an offence. This provision may be interpreted narrowly and hence serve as a barrier to communication and cooperation.

Seeking / Securing Funding

There are no special rules relating to the receipt of foreign funds by CSOs.

NGOs are permitted to engage in economic activities to sustain themselves as long as they plough back the profits into promoting the NGO’s purposes and ensure that the activities are directly related to the NGO’s purposes or carried out on behalf of its beneficiaries. NGOs can conduct the business activities either directly or through for-profit subsidiaries.

CSOs are permitted to compete for government funds in free and open competitions where specific guidelines have been established. There are, however, very few instances where CSOs receive funding from the Government.

Generally, Kenyan law provides a conducive framework for CSOs to seek and secure funding. Local resource mobilization through harambees (public fund-raisers) is recognized, as long as it adheres to the guidelines in the Public Collections Act, which are generally enabling.


Tax Treatment of CSO Income

1. Income from grants, donations, membership fees
Even though donations are not identified under section 3(2) of the Income Tax Act (Chapter 470, Laws of Kenya) as income subject to taxation, CSOs must apply for tax exemption of their income, which mainly consists of donor funds. Paragraph 10 of Schedule 1 of the Income Tax Act exempts the following organizations, which are charities or charitable organizations, from income tax:

“an institution, body of persons, or irrevocable trust, of a public character established solely for the purposes of the relief of the poverty or distress of the public, or for the advancement of religion or education,

  • established in Kenya; or
  • whose regional headquarters is situated in Kenya,

in so far as the Commissioner is satisfied that the income is to be expended either within Kenya or in circumstances in which the expenditure of that income is for purposes which result to the benefit of the residents of Kenya.”

The open-ended phrase “purposes which result to the benefit of the residents of Kenya” which constitutes part of the definition of a charity is flexible enough to enable the concept of charity to adapt to changes in Kenyan society. Indeed, the Commissioner of Income Tax has exercised his discretion to determine, with regard to all circumstances, whether a type of activity, object or purpose falls in this final category and, as a corollary, is charitable.

Organizations meeting the conditions laid out under Schedule 1, part 10, of the Income Tax Act are eligible for registration as charities and, as a corollary, for exemption from income tax. Once the Commissioner is convinced that the conditions under the provision have been met, he is obliged to grant tax exempt status to the applying entity.

Customs Duties and VAT

The Minister of Finance has powers to grant remission to CSOs for duty or tax payable on imported goods.  He can remit customs duties in respect of goods including equipment, motor vehicles, vessels and aircraft (and excluding motor vehicles of a seating capacity of up to twenty-six persons, office equipment, stationery and office furniture), which the Commissioner is satisfied are imported by or consigned to charitable organizations … for free distribution to poor and needy persons or for use in medical treatment or rehabilitation work in their institutions, provided that the Treasury has given its approval in writing where the duty exceeds KShs. 500,00033; This provision limits the type of goods that are subject to remission of customs duties and restricts the use to which such goods can be put, i.e., to charitable uses.  The remission is primarily intended to serve the public interest.  Only CSOs with tax-exempt status34 can apply for remission of customs duties.

The EAC Customs Management Act 2005 provides that NGOs seeking exemptions are required to enter into partnerships with Ministries in their respective sectors of operation, through signing specific agreements.  The Ministries will then recommend the NGO for exemptions.

The VAT Act35 provides for remission of tax for taxable goods, which are intended for emergency relief purposes, for use in specific areas and within a specified period, imported or purchased locally by the Government or its approved agent, a nongovernmental organization or a relief agency authorized by the Minister responsible for disaster management, where:

  • the goods are for use in areas where a natural disaster or calamity has occurred in Kenya; or
  • the goods are intended for use in officially recognized refugee camps in Kenya;
  • the goods are household utensils, foodstuffs, materials for provision of shelter or equipment and materials for health, sanitary or educational purposes; and
  • in the case of a natural disaster or calamity, the importation or purchase locally is made within six months or such further period, not exceeding twelve months, as the Commissioner may permit in each case.

The 3rd Schedule of the VAT Act also exempts a wide range of social welfare services provided by charitable organizations from VAT.  Only tax-exempt CSOs can apply for remission of VAT.  Whether an NGO seeks exemption from tax in respect to imported goods, value added tax on goods and services required to meet the organization’s objectives, or income tax for expatriate employees, it should apply for exemptions through the Board to the Minister of Finance.  Section 30(2) of the NGO Regulations states that the Board shall, on receipt of any application, forward it to the Minister of Finance together with its relevant recommendations.

Tax Deductible Donations

Under the Income Tax (Charitable Donations) Regulations published in June 2007, persons (individuals or corporate entities) who give cash donations to eligible non-profit bodies are entitled to deduct 100% of the donation from their gross income before arriving at their taxable income. Under the Regulations, recipients of deductible donations must be charitable organizations, which are defined as: “Non-profit making organizations established in Kenya and which are of a public character, and have been established for purposes of the relief of the poverty or distress of the public, or advancement of education.”

Unlike the definition of charitable organization for purposes of income tax exemption, this definition omits non-profit making organizations whose regional headquarters are situated in Kenya, where the Commissioner of Income Tax is satisfied that the income is to be expended either within Kenya or in circumstances in which the expenditure of that income is for purposes which result to the benefit of the residents of Kenya; and omits the word “solely”, which implies that charitable CSOs do not have to be established only for one or more of the exempt purposes specified, in order to benefit from tax deductible donations extended to them.

Nonetheless, the recipient must give the donor a written declaration that the donation shall be used exclusively for the object(s) of charity. The recipient must also supply the donor with a copy of its valid certificate of tax-exempt status issued by Kenya Revenue Authority (KRA), or with a copy of the approval of the project issued by the Minister of Finance. Donations must be in “cash” or by “cheque”. The donation, however, must never, under any circumstances, be repayable or refundable to the donor. The law also states categorically that the donation must not in any way, apart from moral satisfaction, benefit the giver.

Income from Economic Activities

Schedule 1, Part I (10) of the Income Tax Act distinguishes between related and unrelated business activities in determining whether income is exempt from taxation. Income derived directly from business activities, which are carried out by charities, may be exempt from taxation only if:

  • The income is applied to the limited charitable purposes set out in Schedule I; and
  • The business activities are directly related to the limited purposes set out in Schedule I; or
  • The business activities are carried out by the charity’s beneficiaries.


While the provisions governing the business activities of charities may encourage non-commercial behaviour, they also recognize the need of CSOs to have a balanced and reliable revenue stream to carry out their activities.

Investment Income

There are a variety of investment options available to CSOs in their quest for sustainability. They include acquiring property; taking out social bonds on the stock exchange, where the CSO channels investors’ funds directly to assist community development projects; investing in stocks, bonds, money market instruments and unit trusts; and endowment funds.

The first key stumbling block for CSOs that are keen to invest is the lack of a legal framework to address the issue, which has led to much uncertainty. The NGO Coordination Act, for example, does not sufficiently address questions regarding investment. In the absence of a conducive legal framework, most CSOs are likely to shy away from venturing into these initiatives. At the same time, traditional investment instruments, such as savings and fixed deposit accounts, which most CSOs use, have negligible returns and may not, in the opinion of some, be worth the effort.

The second major challenge CSOs face is in raising the initial seed capital for investment. Most donors supply funding to CSOs through annual grants, which are not sufficient to support a wide variety of investments. In addition, many CSOs may not have the time and expertise required to venture into, monitor and manage such investments. For example, to set up endowment funds, a board of trustees must be set up, the fund has to be registered, and stringent Revenue Authority requirements must be complied with. Similarly, floating a bond on the stock exchange requires rigorous and painstaking efforts; the NGO must register a corporation, as the laws only permit companies to undertake this type of investment.


Priority Issues

The most important legal issues or challenges currently confronting civil society organizations include the following:

  1. The existing legal and institutional framework for CSOs is fragmented and confusing, with multiple options for registration. There is no coordination among the various regulatory agencies. Sessional Paper No. 1 of 2006 recommends that the overlapping legislative acts be harmonized. The Paper proposes that the NGO Coordination Board, the NGO Council and other stakeholders should play a key role in the harmonization process.
  2. Suspicions and mistrust still characterize the Government-CSO relationship. The suspicion has been fueled by, among other things, the lack of a comprehensive framework for partnership and poorly defined structures for collaboration between CSOs and the Government.
  3. Issues of transparency and internal governance especially in NGOs are in dire need of being addressed. There is definitely a need to rethink the role of self-regulation and to re-define compliance and enforcement strategies in Kenya. The regulatory mechanisms for the promotion of good practices will have to be strengthened. For instance, Sessional Paper No. 1 of 2006 proposes that the NGO Coordination Act of 1990 will need to be revised in order to formally establish and strengthen the NGO Council’s Regulatory Committee, which will retain the key responsibility for enforcing the Code of Conduct.


The opportunities for progressive law reform affecting civil society in Kenya are several:

  1. Government-backed reform initiative. The Government of Kenya and NGOs are preparing to review the NGO Coordination Act. The opportunity to influence the NGO Act and create a more enabling environment is therefore available. The Government has shown willingness to collaborate with CSOs in revising the legal framework. Among other issues, it will be necessary to resolve the appropriate balance between statutory regulation vs. self-regulation, and the harmonization of the relationship among the various regulatory schemes.
  2. An initiative to enhance partnerships between the Government and CSOs. An initiative aimed at strengthening the Government-CSO relationship is currently underway and has brought together Government and CSO representatives in a working group. The group has developed principles for collaboration and is in the process of developing clear strategies for engagement between the sectors.
  3. The CSO initiative on standards. The Kenya Civil Society Competence and Sustainability Program is a CSO-led initiative, which aims to strengthen the competence and sustainability of the CSO sector through developing sector-wide standards, building the capacity of CSOs to comply with the standards and establishing an institution—VIWANGO—to assess compliance with the standards. The initiative demonstrates that CSOs appreciate the grave need to put their houses and the sector in order. Through this sector-wide initiative, CSOs are sending an important message to the Government and all potential partners that they intend to conduct themselves in a professional, competent and transparent manner. The initiative will therefore lay the foundation for improved relationships between CSOs and the Government.
  4. Research paper available. A well-researched paper on the content of Kenyan law and the process of law reform has been published in an online journal – the International Journal for Not-for-Profit Law (IJNL) – to inform the consultations, decisions, positions and strategies of the law review process in Kenya. The paper was prepared by two Kenyan research fellows (an NGO representative and a government official) at the International Center for Not-for-Profit Law (ICNL). In addition, an action plan has been developed by NGO and government representatives during a South Africa study tour.
  5. Constitution review process. Efforts to review the constitution may provide an opportunity to improve the overarching constitutional framework for CSO formation and activities. For example, the draft constitution provides for access to information; prohibits unlawful instructions or orders; and recognises civil society as a sector to be represented in the various organs and levels of governance. The draft also restricts the limitations found in the Bill of Rights, which could be significant, as Sessional Paper No. 1 2006 provides that any possible restrictions on the operations of any NGO will be those contained in or based on the authority of the law or those shown to be reasonably justifiable in a democratic society. Since the Constitution is the supreme law of the land, its provisions will prevail where provisions in other laws are found to be inconsistent with it. It will therefore be prudent for stakeholders to ensure that revisions to the NGO law are consistent with those of the reviewed Constitution.


1 Faith Kisinga Gitonga is Consultant on the Enabling Environment for Civil Society.

This paper is made possible with the generous support of the American people through the United States Agency for International Development (USAID). The contents are the responsibility of the authors and do not necessarily reflect the views of USAID or the United States Government.

2 The rules are subject to what the “circumstances of Kenya and its inhabitants permit”.

3 Section 3 of the Judicature Act, Chapter 8, Laws of Kenya (Act 16 of 1967)

4 For example, the Indian Transfer of Property Act.

5 The NGO Coordination Act of 1990, The Societies Act (Chapter 108, Laws of Kenya) and the Trustees (Perpetual Succession) Act, Chapter 164, Laws of Kenya are some of these laws.

6 12 August 1897 is the date when these English laws were received and recognized as laws to be applied in the Kenya colony.

7 Ibid. Section 3(2)

8 An inclusive list, which serves as a guide, is found in The Magistrates Courts Act, 1967, Section 2

10 Article 22(1) of the ICCPR, 1996

11 Article 10(1) of the ACHPR

12 The freedom of assembly and of association with others is found in Chapter V, Section 80: “Except with his own consent, no person shall be hindered in the enjoyment of his freedom of assembly and association, that is to say, his right to assemble freely and associate with other persons and in particular to form or belong to trade unions or other associations for the protection of his interests”.

13 Under section 80(2)d of the Constitution of Kenya, the freedom of assembly and association is also subject to limitations provided in laws governing the registration of trade unions and associations of trade unions.

14 Section 80 of Chapter V Constitution of Kenya provides for limitations “except so far as that provision or, as the case may be, the thing done under the authority thereof is shown not to be reasonably justifiable in a democratic society.”

15 The NGO Coordination Board is a Government Agency which exists to register, co-ordinate and facilitate the work of all national and international NGOs operating in Kenya.

16 Act No. 19 of 1990, Laws of Kenya

17 Kanyinga, K., Mitullah, M. and Njagi, S., The Non-Profit Sector in Kenya: Size, Scope and Financing. Nairobi: The Institute for Development Studies, 2007.

18 Chapter 486, Laws of Kenya

19 Section 25(1) and (2) NGO Regulations 1992, Subsection 2 provides: Upon registration under the Act, the organization referred to shall cease to operate under any other written law in Kenya or on the basis of any agreements with the Government as the case may be.

20 Sessional Paper No. 1 of 2006 reiterates this objective. It remains to be seen how the revised law will address the issue.

21 Kanyinga, K., Mitullah, M. and Njagi, S., The Non-Profit Sector in Kenya: Size, Scope and Financing. Nairobi: The Institute for Development Studies, 2007.

22 The NGO Coordination Board’s main mandate is to streamline registration and coordination of NGOs.

23 The NGO Council is a national umbrella body for NGOs. Once NGOs are registered by the NGO Coordination Board, they are required to apply for membership in the Council. The Council represents the interests of its members and also provides them with essential services. It also formulates policies on self-regulation for NGOs and advices the NGO Board on the Code of Conduct for NGOs.

24 Kameri-Mbote, Patricia, Dr. (2000) ‘The Operational Environment and Constraints for NGOs in Kenya’ IELRC Working Paper,

25 Section 12(4) NGO Coordination Act

26 Trustees (Perpetual Succession Act), Chapter 164, Laws of Kenya

27 Id.

28 Section 3(1), Trustee Act Chapter 167, Laws of Kenya.

29 Section 23 (1) of the NGO Coordination Act presumes automatic membership of NGOs upon registration. It provides: “There shall be established a Council to be known as the Non-Governmental Organisations Council which shall serve, as a collective forum of all Non-Governmental Organizations registered under this Act.”

30 Rule 24

31 Section 7(c)

32 Rule 21(c)

33 Schedule 3, Part 12 to the Customs and Excise Act, Cap 472.

34 That is, non-profit making organizations with charitable and tax-exempt status.

35 Chapter 476, Laws of Kenya, section 23(3) as amended by Finance Bill of 2009.