Kenya export processing zones

Kenya export processing zones

Free zones in KenyaBoasting more than a decade of experience setting up businesses in Kenya, Healy Consultants successfully assists our Clients to incorporate their business in Kenya’s export processing zones (EPZ) and consequently benefit from numerous tax and investment incentives. Furthermore, under Vision 2030 plan, in the next fifteen years, Kenya will attract even more foreign investments via three new Special Economic Zones.

  • With the utilization of seven export processing zones (EPZ) Kenya’s Government aims to provide to foreign investors considerable industry-driven estates with quality logistics infrastructure to support export oriented businesses. Kenyan EPZ business setups represent ideal low cost investment opportunity for companies exporting their products to Africa and the Indian Ocean regions, thanks to i) optimal East Africa location next to important transport hubs and customs ii) extended tax and VAT holidays and incentives and iii) quick and transparent company setup procedures;
  • The Kenyan Export Processing Zone Authority currently operate 7 free trade zones: i) Athi River EPZ, which is the most prominent; ii) Nairobi EPZ; iii) Mombasa Port City EPZ; iv) Kilifi EPZ; v) Malindi EPZ vi) Voi EPZ and vii) Kimwarer EPZ;
  • In accordance with Kenya’s Export processing zones Act Chapter 517, Kenyan free zones EPZs offer multiple investment benefits including i) full 10 year corporate tax holiday and 25% afterwards and ii) VAT and custom duties deductions and iii) full 10 year withholding tax holidays. As the largest and most developed estate, Athi River EPZ additionally offers i) full stamp duty exemptions; ii) modern logistics infrastructure and iii) custom duty exemptions for construction and raw materials;
  • Foreign investors are required to obtain EPZ Enterprise license from the Export Processing Zone Authority in order to conduct activities in any of Kenya’s seven EPZs. Healy Consultants will be happy to guide our Clients through this process by i) preparing feasibility study to evaluate the investment project; ii) prepare a quality draft business plan in accordance with the Authority’s guidelines and iii) register a new EPZ LLC company directly with the Export Processing Zone Authority.

The Kenyan Special Economic Zone Plan

  • As a part of the Vision 2030 plan, the Kenyan Ministry of East African Affairs, Commerce and Tourism plans to establish three new Special Economic Zones (SEZ) in Kenya, including: i) Mombasa SEZ; ii) Kisumu SEZ and iii) Lamu SEZ. As a result, Kenya aims to diversify the current export oriented foreign investments with new wholesale and retails operators;
  • By March 2015, the Special Economic Zone bill is still under review and not approved from the Kenyan Parliament;
  • Once operational the Special Economic Zones will serve as prime locations for manufacturing business in the region. Each estate will cover wide area with i) 2000 square km. in the Greater Mombasa zone; ii) 700 square km. of land is Kisumu and iii) 700 square km. of land is Lamu.

Table of comparison between Kenya export processing zones

Export Processing Zone comparisonAthi River EPZOther Kenya EPZs
FEZs used mostly by which industry?ManufacturingManufacturing and agriculture
Average annual warehousing space rent per 1000 sq. m.1,2001,100
How long to set the company up?3-4 weeks4 weeks
Registration with which government agency?Export Processing Zone AuthorityExport Processing Zone Authority
How long to open company bank account?4 weeks4 weeks
Quality of utilitiesHighModerate
Allowed to sign sales contracts with Kenya Clients?YesYes
Allowed to invoice Kenya Clients?YesYes
Agent required to conduct business outside of EPZ?NoNo
Benefits for operations outside of FEZs?NoNo
Corporate tax payable in Kenya0%0%
Corporate bank account options?Barclays bankStandard Chartered Bank
Physical office space requiredYesYes
Subsidies for land purchases?NoNo
Allowed to import raw materials?YesYes
Allowed to export goods?YesYes
No duties on imports and exports?NoNo
VAT exemption on imports?NoNo
VAT exemption on products sold in Kenya?NoNo
Can be wholly foreign ownedYesYes
Can the entity hire expatriate staff in Kenya?YesYes
Foreign employee quota of?NoNo
Payroll tax exemption for foreign employees?NoNo
Social security contributions exemptions for foreign employees?NoNo
Minimum number of directors11
Minimum number of shareholders22
Tax registration certificate requiredNoNo
Individual shareholders allowedYesYes
Corporate shareholders allowedYesYes
Corporate director(s) allowedNoNo
LLC company allowed?YesYes
Annual financial statements?YesYes

Contact us

For additional information on our free trade zone company registration services in Kenya, please email us at email@healyconsultants.com. Alternatively please contact our in-house country expert, Mr. Kunal Fabiani, directly:
client relationship officer - Kunal