Updated legal frameworks enhance oversight of key sectors in Kenya

Alongside its high degree of political stability and favourable economic climate, Kenya’s modernised legal system is a factor in its ranking in the World Bank’s “Doing Business 2018” report, in which it placed third in sub-Saharan Africa – after Mauritius (25th) and Rwanda (41st) – and 80th globally.

The stability and usability of a legal regime plays an important role in attracting foreign direct investment (FDI). International investors need to be assured that any capital outlays they make will be protected within a stable legal regime that takes into account political threats such as expropriation. The long-term nature of most international investments also requires a high degree of legal stability. Furthermore, foreign investors often require assurance that should a dispute arise, it will be resolved fairly within a domestic legal system that fully incorporates the dynamics of international legal principles.

History

Like any other African society, before the onset of colonisation, the Kenyan legal system was based on African Traditional Community modalities of reconciliation, informal mediation and other ethnic-based alternative dispute resolution methods. In 1895 the British legal system was made a reserve of the colonisers, while the natives continued being governed by the African Customary Law. This was commonly described as a dual legal system.

Since Kenya’s independence, the legal framework has been unified and was significantly modelled on the UK’s structure. This assisted in the post-colonial development of the system, as its precedents had already been tried and tested in the UK and Wales.

In the lead-up to 2010 Kenya had experienced very few, if any, legislative changes. However, the ratification of a new constitution in 2010, which replaced its colonial counterpart, revised a number of laws to improve the domestic business environment.

Decentralisation

The issue of decentralisation is also of great importance to the legal system. The implementation of the constitution has led to the transfer of significant powers – including legislative functions – from the federal government to the counties. However, this focus on greater devolution of powers has been slightly weakened by policies that have struggled to harmonise national and county-level functions. Through the Intergovernmental Relations Act, the Intergovernmental Relations Technical Committee established a framework to facilitate consultation and cooperation between the national and county governments, as well as among county authorities themselves.

Big Four Agenda

The legal implications of the Big Four agenda will likely have significant influence in 2018. Unveiled by President Uhuru Kenyatta in late 2017, the Big Four agenda provides principles to guide the development of the country over the 2017-22 period, with the aim of transforming Kenya into an upper-middle-income country. As such, this plan aims to improve domestic living standards by addressing the basic needs of the population: affordable and decent housing, affordable health care, food and nutrition security, and employment creation through the manufacturing industry.

Internatonal Investment Climate

Since its independence, Kenya has attracted significant international trade, and FDI has risen steadily. KenInvest, established in 2004 through an act of Parliament is the government’s investment promotion agency tasked with the promotion and facilitation of investment. KenInvest does this by assisting investors in obtaining the licences necessary for their projects, providing after-care services for existing investments, organising investment promotion activities, policy advocacy, and other assistance and incentives as required for smoother operations.

In efforts to further support this globally oriented growth, Kenya has signed bilateral investment treaties (BITs) with many countries to facilitate FDI. The larger East African region, with Kenya acting as its economic centre, is also in the process of negotiating a BIT with the US. These agreements incentivise foreign investment in that they facilitate favourable conditions for investors as guaranteed under World Trade Organisation and international law, such as:

• Most-favoured nation obligations;

• National treatment principles;

• Compensation on expropriation; and

• Stabilisation conditions. Additionally, BITs have continued granting investors a favourable dispute-resolution avenue by mandating that the host state submit to international arbitration forums. This legal adaptability has built trust in the judicial system, which has resulted in increasing international investment.

Tax Law & Incentives

The structure of taxation – in terms of both income and value-added tax (VAT), as well as excise duties – is also a key factor in attracting FDI. Because of this, in recent years Kenya has signed double-taxation treaties with various countries, including Canada, Denmark, France, Germany, India, Iran, Mauritius, Norway, Sweden, the UK, Zambia and South Africa. Most of these agreements offer preferential tax rates and allow individuals to set off withholding tax against their tax liability in the participating nations. The EAC as an economic bloc has also created double-taxation treaties with partner countries such as Kuwait, Iran, Mauritius and the UAE, which are pending ratification.

Beyond country- or bloc-specific agreements, special economic zones (SEZs) and export processing zones (EPZs) are also key attractors of international interest and investment. In order to support the development of EPZs and bolster industrialisation, the EPZ Act was passed in 1990 and revised in 2015. This law created the EPZ Authority, which aims to advance EPZs through its medium-term plans. This structure resulted from the 2012 constitutional change, which introduced the stipulation that government bodies help create an environment that spurs socio-economic development and supports decentralisation efforts. The Medium-Term Plan 2013-17, focused on improving and modernising infrastructure and the manufacturing industry, is premised on Kenya Vision 2030. The EPZ Authority has been placing an emphasis on transforming EPZs into SEZs, which offer tax incentives such as:

• A 10-year corporate tax holiday, followed by a reduced corporate tax rate of 25% rather than the typical 30%;

• Withholding tax holidays for 10 years;

• Duty and VAT exemption on inputs; and

• Exemptions from stamp duties.

Anti-Trust & Competition Laws

Fair market competition is also a key attractor of FDI. To ensure that the domestic regulatory framework keeps this spirit, the Competition Act of 2010, which prohibits anti-competition agreements, was amended in 2016 to increase sanctions on parties in breach of the law. The amendments also empowered the Competition Authority of Kenya (CAK) to prosecute anti-competitive behaviour; introduced a requirement that parties engaging in mergers and acquisitions provide the CAK with adequate and correct information for the authority to assess the transaction; and prohibited the abuse of power by buyer groups. It was not clear how the latter would be achieved by mid-2018, as the law mandates the CAK, in consultation with the Cabinet secretary, make regulations to provide guidance on how one would prevent the abuse of buyer power.

Part IV of the Competition Act further obliges bodies engaging in a merger or acquisition to:

• Provide the CAK with information when proposing a merger;

• Ensure that mergers and acquisition activities are carried out in a manner that has the least social impact; and

• Make sure that competing brands are not prejudiced by the transactions.

Franchises

This encouragement of a fair market extends to foreign businesses: international players benefit from regulations to prevent unfair competition from local brands, as well as a relatively simple process to establish a business in the country. This favourable framework has resulted in the successful establishment of increasing numbers of foreign companies in recent years. The food retail market, in particular, has seen the growth of franchises.

Although Kenya has no specific law on franchises, much like all other types of businesses, these fall under the purview of the Competition Act, the Consumer Protection Act, the Anti-Counterfeit Act and the Industrial Property Act. The Anti-Counterfeit Agency and the Kenya Industrial Property Institute have led the charge in protecting inventors’ rights, while the commercial division of the High Court has continued to consider and make judgements on claims relating to intellectual property disputes.

E-Government

In similar efforts to support businesses, the government modernised the Companies Act in 2015 and has since worked to further facilitate and automate the business registration process. The government’s web-based portal, eCitizen, was launched in June 2014 to carry out key business registration services, replacing the previous manual processes at the Registrar of Companies. To become an account holder on the platform, one must register with their ID data to access business registration services, which include:

• Search for and reservation of a business name;

• Registration of a limited liability partnership;

• Incorporation of a company;

• Filing of annual tax returns; and

• Registration of changes in directorship and shareholding of a business. This digitalisation initiative is a key part of the Business Registration and Service Act, which was introduced in 2015. The legislation also established the Business Registration Service, a body responsible for the implementation of policies, laws and other matters relating to the registration of companies, partnerships and firms. This automation of regulatory oversight has put greater pressure on foreign business owners to regularise their immigration status, as they require both an Alien Card and a Kenya Revenue Authority personal ID number in order to open and operate an eCitizen account.

The digitalisation of business registration comes on the back of similar initiatives for a variety of other government undertakings. Among the other services that have either already been successfully digitalised or are undergoing digitalisation are:

• Registration for civil documents, such as birth, death and marriage certificates;

• Management of parking fees;

• Immigration services;

• Motor vehicle transfers;

• Ministry of Land and Physical Planning’s procedures, such as applying for rent clearance certificates; and

• Services related to the National Hospital Insurance Fund (NHIF). Most of these have been centralised on the eCitizen platform, making it a one-stop shop for government services. Efforts to digitalise these services are expected to help curb fraud and corruption while enhancing efficiency.

Banking

The domestic banking sector has undergone notable change in recent years. After a 16-month freeze on the licensing of new banks, the regulator, the Central Bank of Kenya (CBK) lifted this moratorium in March 2017 upon its issuance of licences to Dubai Islamic Bank and Mayfair Bank.

Furthermore, in September 2016 the government passed the Banking (Amendment) Act, which capped commercial lending rates at four percentage points above the CBK’s benchmark rate and established a minimum deposit interest rate of 70% of the benchmark. Though popular among borrowers, the cap prompted banks to slow their lending activities, as this resulted in a higher perceived risk of advancing credit. Consequently, private sector credit growth has been subdued since the cap was introduced.

Driven by the possible negative economic effects of interest rate caps, the National Treasury is working to replace the legal caps on commercial lending rates through the Consumer Protection Act No. 46 of 2012. This may see the restructuring of credit reference bureaux and the adoption of a mechanism facilitating lenders’ pricing of risks.

Though banks have shown reluctance to lend, in March 2018 the Monetary Policy Committee of the CBK revised the base lending rate downwards from 10% to 9.5%. The low lending rates have contributed to a decline in the number of mortgages, debentures and legal charges registered.

Islamic Banking

Kenya is positioning itself to become a regional centre for Islamic finance in East Africa. The government passed the Financial Act in 2017, effectively amending various financial laws, and other regulations have been enacted in recent years to facilitate a sharia-compliant retirement benefits scheme and to allow the issuance of sukuk (Islamic bonds) for infrastructure projects.

The government has established the Islamic Finance Project Management Office to coordinate efforts among its regulatory agencies on Islamic finance. Amendments to the Public Finance Management Act will further allow the government to issue sukuk as an alternative funding source. Sharia-compliant savings and credit cooperative (SACCO) societies have also been allowed through an amendment to the SACCO Societies Act.

Buoyed by the growth potential of Islamic finance, the CBK licensed Dubai Islamic Bank – the world’s first Islamic bank – to operate in Kenya. This should bolster the already robust market: Kenya had two fully fledged Islamic banks and several Islamic windows by that time. Growth has been further catalysed by changes to the tax regime, which have introduced exemptions from stamp duties for Islamic financing products. This is part of efforts to ensure they are tax neutral against interest-based transactions, as the asset-based nature of Islamic finance contracts means they often incur multiple tax charges.

Islamic bank deposits are also exempt from VAT, allowing returns on these to be eligible for deductions in a similar way to interest-based financial products. While the government is working on regulations to facilitate the issuance of sukuk, some regulatory gaps have been identified, such as the lack of both a deposit insurance scheme for Islamic banking and a sharia-compliant prudential framework.

International Financial Centre

With one of the best-performing financial and securities market in Africa, Nairobi – dubbed the Silicon Savannah – is working to attract FDI inflows to not only Kenya, but also the continent as a whole.

In 2017 the authorities passed the Nairobi International Financial Centre Act in a further step towards earning this moniker. The law defines a framework to support the development of a globally competitive financial services sector, and it established the Nairobi Financial Centre Authority, which is responsible for the creation and maintenance of an efficient operating structure to both attract and retain businesses. Furthermore, it will work with the relevant regulatory authorities to incentivise the entrance of international firms, as well as review and recommend changes to the legal and regulatory system to establish Kenya as an internationally competitive financial centre.

Energy

Kenya is in a development phase with regards to its domestic energy requirements. In the past the country has struggled with unreliable, expensive and unsustainable energy use, which had resulted in a stagnating industrial and manufacturing base. However, recent years have seen Kenya embark on a host of ambitious new projects, such as geothermal and wind power generation, which are expected to strengthen the sector through a more diversified energy mix.

The regulatory framework for energy is due for an overhaul in light of capacity constraints and a push towards sustainability. This will be triggered by the passage into law of the Energy Bill, scheduled for 2018, which prioritises renewable energy development by creating a number of regulatory agencies, including the:

• Nuclear Electricity Institute;

• Nuclear Electricity Tribunal;

• Energy Efficiency and Conservation Authority;

• Energy Regulatory Authority; and

• Rural Electrification and Renewable Energy Corporation. The Energy Bill also seeks to license private power suppliers and end the long-established monopoly in the energy sector.

Oil & Gas Reforms

Since the discovery of commercially viable oil resources in 2012, Kenya has moved closer to selling its oil on the international market, with full-field oil production anticipated to begin in 2021 and an early oil pilot initiative being launched in 2018. The Petroleum (Exploration and Production) Act (PEPA), which was introduced in 1984 and updated in 2012, currently regulates the government’s negotiation and conclusion of petroleum agreements relating to the exploration, development, production and transport of petroleum, as well as for related endeavours.

Despite the changes made to the PEPA over the decades since it came into effect in November 1986, it is widely considered to be outdated. The Petroleum (Exploration, Development and Production) Bill, which is pending approval by Parliament, proposes a framework to update the regulatory framework, including matters related to:

• Contracting, exploration, development and production of petroleum;

• Cessation of upstream petroleum operations; and

• Effectiveness of relevant articles of the constitution insofar as they apply to upstream petroleum operations. Once enacted, the Petroleum (Exploration, Development and Production) Bill will repeal the PEPA.

Various other measures to improve the regulation of extractive industries have been proposed in recent years, with some still awaiting parliamentary approval. First, the Natural Resources (Classes of Transactions Subject to Ratification) Act was introduced in 2016, defining which transactions are subject to ratification by Parliament to include agreements relating to the authorisation to extract crude oil, natural gas, or minerals within a wildlife conservation area or other wildlife protected area. Through this measure, the authorities have begun to define the regulatory framework governing oil, gas and other extractive industries.

In further efforts to develop this legislation, the Local Content Bill was introduced in 2016 to facilitate the local ownership, control and financing of activities related to the exploration of gas, oil and other mineral resources. This bill also aims to increase the local value addition and capture earnings along the value chain in these extractive industries.

Meanwhile, as the name suggests, the National Resources (Benefits Sharing) Bill seeks to establish a system to disperse revenue between the national government, county governments and local communities in areas of resource exploitation. The bill, once enacted, would apply to the exploitation of various natural resources, including petroleum and other hydrocarbons. It would also establish the Benefits Sharing Authority, which would be responsible for coordinating the preparation of benefits-sharing agreement between local communities and affected organisations.

Mining

The Mining Act of 2016 ushered in a new era for the domestic mining industry. Together with the May 2017 Mining Regulations and Guidelines, this law established a modernised legal structure consistent with the contemporary needs of players in the sector. It also simplified the acquisition of mining rights, with prospecting and mining rights now coming in the form of either a permit (for small-scale operations and artisanal miners) or a licence (for their large-scale counterparts). The assignment, transfer, trading and mortgage in mineral rights is allowed with the consent of the minister.

Importantly, the structure of the Mining Act follows the provisions of the 2010 constitution, which stipulates that the public sector play a larger role in the exploitation, management and preservation of the environment and natural resources for current and future generations. In particular, the legalisation of artisanal miners utilising traditional methods and technology in extracting minerals should help work towards this goal, though some industry players have criticised it as a potential avenue for money laundering and cartels. The aforementioned modernisation of government services has also seen the mining cadastre digitalised, with licences available through an online application.

The legislation has made community development agreements a pre-requisite for all holders of large-scale mining licences, and it provides for the sharing of royalties between and among the national government, county government and local communities. In more concrete terms, the Mining Act sets a limit on capital outlays by mining companies, with a requirement that businesses with planned expenditure exceeding the defined cap must offload at least 20% of the company’s equity at the local stock exchange. Additionally, any enterprise granted a mining licence is obliged to issue 10% free carried interest to the government in all of the mining operations it undertakes.

Real Estate & Infrastructure

Alongside the government’s moves to strengthen the regulatory bodies tasked with overseeing the extractive industries, Kenya has also made significant strides in establishing well-defined property rights in acknowledgement of the real estate sector’s rising economic importance. Indeed, with the inflow of international companies and personnel, the sector is expected to continue growing on the back of lower financing costs and the entry of institutional developers to the local market. Especially at the county level, infrastructure works, including roads, the Standard-Gauge Railway project and power distribution, has led to the opening up of areas for potential development. Kenya’s attractiveness as a real estate destination has been buoyed by the ongoing construction of “The Pinnacle” – poised to be the tallest building in Africa – in Nairobi.

The Ministry of Land and Physical Planning proposed updated regulations, which are awaiting parliamentary approval in 2018. The Land Registration (General) Regulations 2017, Land Registration ( Registration Units) Order 2017, Land Regulations 2017 and Land (Extension and Renewal of Lease) Rules 2017 outline the following:

• Forms to be used in connection with land transactions;

• Guidelines on electronic registration and conveyancing;

• Time limits for services at land registries;

• Procedures for dispute resolution by land registers; and

• Organisation and administration of land registries. These regulations will work together to harmonise the current, at times convoluted, land procedures.

These updates are part of efforts to address market changes in recent years. In 2015 real estate investment trusts (REITs) were introduced, ushering in a new investment frontier. REITs – regulated investment vehicles that enable collective investment in real estate – allow investors to pool their funds to buy into a trust that is divided into units, and they are regulated by the Capital Markets Authority under the Capital Markets (REITs) (Collective Investment Schemes) Regulations of 2013. While the lack of clarity on returns on assets resulted in subdued performance of REITs in 2017, they are expected to grow in popularity as investors become increasingly aware of the long-term investment potential of these trusts.

Non-citizens are permitted to own land in any part of the country, but the constitution, the Lands Act and the Land Registration Act impose limitations on the terms of this land ownership. International stakeholders are only permitted to own land on leasehold tenure, and any such lease may not exceed 99 years. Additionally, foreigners are prohibited from owning land within first- and second-row beach plots in the coastal region without the approval of the Cabinet secretary of the Ministry of Land and Physical Planning. Furthermore, non-nationals are not allowed to acquire agricultural land subject to the Land Control Act.

Affordable Housing

The government is working to attract private sector investment in affordable housing, as this is one of the pillars of the Big Four agenda. The incentives for this include a reduction in the corporate tax rate and the scrapping of levies charged by the National Construction Authority and the National Environment Management Authority. The government has also partnered with private firms to construct 1m low-cost housing units by 2023. Parliament has approved a number of policies to facilitate these efforts, such as the:

• National Urban Development Policy;

• National Building Maintenance Policy; and

• National Slum Upgrading and Prevention Policy. In addition, the government has made proposals to establish the Kenya Mortgage Refinancing Company, which would issue bonds to local capital markets and extend longer-term loans to financial institutions to secure access to mortgages.

PPP: In the World Bank Group’s “Benchmarking Public-Private Partnerships (PPPs) Procurement 2017” report, Kenya was among the top-10 sub-Saharan African countries reviewed in terms of employing an effective PPP framework. The Treasury, through the government’s PPP Unit, is responsible for the overall coordination, promotion, and oversight of PPP programme implementation in the country. The typical contractual structure of these agreements involves government agencies, a special-purpose vehicle, private contractors, lenders and equity providers.

In 2011 the government implemented the PPP Policy, which laid the groundwork for the PPP Act of 2013. The latter performed the following functions:

• Defined recognised types of PPPs and their scope;

• Outlined a process to identify, prioritise, conceptualise, develop, award, approve, execute and monitor these projects;

• Established various institutions and regulatory bodies in charge of overseeing these initiatives;

• Provided financial security instruments to support PPPs; and

• Created a project facilitation fund to help bridge any gaps in PPP funding and meet any other contingent liabilities from these initiatives. This was followed by the PPP Regulations of 2014, which provided further details on the procedures of the PPP pipeline, as well as the roles and responsibilities of PPP stakeholders. Subsequently, in 2017 the PPPs (Project Facilitation Fund) Regulations were enacted, establishing a fund to support PPP project implementation in the form of grants, loans, equity, guarantees and other financial instruments.

According to the PPP Unit, in June 2018 there were 72 projects at various stages of development in the PPP pipeline, 67 of which were approved under the solicited process and five as privately initiated proposals. Of the PPPs contracted by the state, 61 were under the national government, with the county-level authorities responsible for the remaining six. Spanning diverse sectors, these projects are key for the development of large-scale initiatives.

Tourism

Kenya’s tourism is considered synonymous with the word “safari”: a spirit of adventure. With its wildlife, landscapes – such as the Great Rift Valley – and beaches, Kenya consistently attracts large numbers of tourists. The Tourism Act of 2011, which established the Tourism Regulatory Authority to oversee related projects, has further boosted these figures, in part by supporting cruise ship tourism. A modern cruise ship terminal is under construction at Kilindini harbour. The terminal will allow the simultaneous berthing of several cruise liners. This is in line with the government’s strategy to develop cruise tourism along the Indian Ocean circuit, which is set to benefit the East African region at large. Further, the Tourism Finance Corporation has funded various projects, including hotels, that cater to the needs of visitors.

In further efforts to bolster and restructure the sector, the government created the National Tourism Blueprint 2030, with the key pillars of product development, marketing, investment and infrastructure development. The government has also established of the National Tourism Council and the Inter-Agency Tourism Council to strengthen relations between the public and private sectors.

Labour

In a move that should support both tourism and migration, President Kenyatta abolished the pre-visa requirement for Africans entering Kenya when he took his oath of office in November 2017. This change has meant that citizens of any country in Africa is now issued a visa at their port of entry, in line with the Free Movement of Persons and the African Passport Policy adopted by the African Union (AU) in July 2016. Under this policy, African nations are set to adopt a common continental passport and work closely with the AU Commission to facilitate its issuance. This is to be in alignment with international, continental and national policies, as well as continental design and specifications. However, these passports have yet to be issued to citizens.

Foreigners who want to work or invest in Kenya require a work permit or special pass from the Ministry of Immigration, as it is illegal for any non-citizen to work in the country without a valid work permit. In April 2018 the government reiterated its intention to deport anyone without a valid residence permit, including immigrants holding jobs that do not require special skills, which are readily available in Kenya, as required under the Immigration Act.

Meanwhile, international businesses benefit from a friendly regulatory environment. Foreign companies may register a branch in Kenya, with no restrictions on non-citizen shareholders and directors. However, shareholders may not be 100% foreigners in the banking, mining, insurance and telecoms sectors.

Manufacturing

The government has identified manufacturing as a top investment priority to drive economic growth, with Kenya ranking among the leading FDI destinations in Africa. In 2017 French automaker Peugeot began local assembly works at Thika-based Kenya Vehicle Manufacturers. This is in addition to the earlier entry of German automaker Volkswagen, which announced plans to double its output at its Kenyan assembly plant in January 2018. International participation has been boosted by the reduction in the corporate tax rate for motor vehicle assemblers from 30% to 15% for the first five years of operations.

Central to the Big Four agenda to expand employment opportunities, the establishment of SEZs is a key area set to bolster domestic manufacturing. SEZs are to be established under the SEZs Act of 2015, with goods manufactured at these zones exempt from most taxes and subject to preferential rates on any applicable duties.

Agriculture & The Blue Economy

While agriculture dominates the economy, food security has been a growing concern, which is why it was highlighted in the Big Four agenda. To further boost the sector, Kenya created the State Department for Maritime and Shipping Affairs to support efforts to capitalise on the “blue economy”, which includes marine markets, fisheries and fish processing.

The government has named this segment as Kenya’s next economic frontier, establishing incentives to boost maritime activity, such as allowing investors to deduct 150% of the value of capital expenditure in the sector from their taxes. The authorities are also reviewing the National Oceans and Fisheries Policy and the National Aquaculture Policy to support the country’s broader economic goals.

ICT

Nairobi is the centre of technological innovation in both Kenya and the wider region. The local start-up incubation scene is booming, as evidenced by increasing numbers of accelerator programmes and incubation centres focused on technology, mobile and impact innovation.

The widespread uptake of mobile money services and their related transactions continue to see accelerated growth in the country, supported by recent moves to support interoperability between mobile money operators (see ICT chapter). These efforts are set to allow for seamless money transfers across mobile platforms, underpinned by the National Payment System Regulations and e-Money Regulations.

In April 2018, for instance, PayPal announced it had formed a partnership with M-Pesa, the mobile wallet service operated by Safaricom, a government-owned telecoms provider. This agreement allows Kenyan users to fund PayPal transactions and withdraw money from their PayPal accounts directly through M-Pesa. This is a welcome move by users, as international payment was not previously widely supported, with Equity Bank the only institution approved by PayPal. Equity Bank requires a seven-day waiting period for international transactions, which could pose challenges for subscribers.

In further efforts to exploit digital currency, the government is looking to employ blockchain technology, cryptocurrency and initial coin offerings to raise funds. In spite of the CBK’s public denunciation of the domestic use of cryptocurrency in the first quarter of 2018, the Ministry of ICT has established a task force to explore the potential regulation of digital money as a currency or property, while the Financial Services Authority has hinted that it is likely to regulate cryptocurrency, even listing it in the financial market when regulations come into place. This is currently under investigation.

The Computer and Cybercrime Bill, awaiting parliamentary approval as of September 2018, aims to monitor, control and eliminate cybercrime, which has naturally risen in conjunction with increasing OBG would like to thank Oseko & Ouma for its contribution to THE REPORT Kenya 2018 internet penetration. If enacted, the Computer and Cybercrime Bill would protect Kenyans from online and offline fraud – including in mobile money transactions and banking services – as well as safeguard client information held by financial institutions from being used for illegal services. Kenya has also started aligning its international companies to ensure worldwide legal compliance, with the General Data Protection Regulations in the EU implemented in 2018.

Health Care

Health care is a constitutionally guaranteed right, central to the well-being of the nation. For this reason, the 2018-22 Big Four agenda emphasises the importance of health care. The NHIF, established under the NHIF Act of 1998, is a priority of the FY 2018/19 federal budget, with expenditure expected to receive a notable boost, from KSh61bn ($598m) in 2017 to KSh71bn ($696m) by 2022.

A number of modernisation efforts are being undertaken in the sector. The decentralisation of NHIF administration to Huduma – or “service” – Centres along with other public services should boost efficiencies. In terms of frontline services, the Linda Mama, or “protect the mother”, initiative promoted by Margaret Kenyatta, the first lady, aims to offer free maternity services first in government hospitals and later in private facilities.

Subject to the operationalisation of the Health Act 2016, which was signed into law in June 2016, the Kenya Human Resources for Health Advisory Council is set to become the independent central body managing health workers, taking this task over from the public authorities. This body, expected to not only guide the formulation of the national health policy, but also harmonise county- and national-level health care guidelines, will play the largest role in the health component of the Big Four agenda.