Starting business still a nightmare for Kenyan entrepreneurs

By Steve Umidha

Kenyan entrepreneurs still face regularity complexity and unnecessary delays to get their businesses started.

Although regulations in Kenya are not among the worst for existing companies, would-be entrepreneurs still face a battle against bureaucracy at the Companies’ Registry offices to get their businesses kickoff.

The situation is now feared could scare potential investors as well as hamper the ongoing reforms aimed at improving the country’s ease of doing business status.

The World Bank’s 2015 Ease of Doing Business index ranked Kenya at position 108 out of 189 countries globally, compared to 136 the previous year, helped by reforms in business and property registration, electricity connections and access to credit.

Despite the reforms which saw a reduction of company registration fees previously capped at Sh30, 000, collapsed to Sh 10,000 for all companies as well introduction of a Unified Application Form incorporating KRA, NSSF and NSSF certificates – many business owners who spoke with this writer, said they were yet to be issued with Certificate of Incorporation, months after completing right procedures in registering their firms.

Michael Wasonga, an entrepreneur based in Nairobi said the condition is stalling most businesses, adding that the problem is being caused by a cartel in the Companies Registry offices at Sheria House, who often delay issuance of certificates intentionally to seek bribes from applicants.

“I’m yet to get my company’s certificate of Incorporation, it’s now more than two months and I’ve made unsuccessful trips and phone calls at Sheria House,” he said.

It is also claimed that these cartels most of whom are based at Sheria House have for many years disguised and acted as brokers and agents who push for speedy documentation process on behalf of applicants at a negotiated fee, usually separate from the customary fees.

The monies are negotiated at different stages and are said to range from Sh4, 000 to ShSh7, 000 or more depending on the ‘agent.’

But speaking during a media briefing on the country’s business climate reforms Tuesday Mr. James Nduna, senior deputy registrar general at the office of attorney general, said that the delays were as a result of applicants’ lack of attentiveness when filling the application forms which are later declined by the officers on duty prompting restart of the procedures.

Business applicants now want the ministry involved to come to their rescue