The Privatization Bill, 2025
Status Timeline
Proposed
Active now
Public Review
Pending
Debate
Pending
Executive
Pending
Final
Pending
Establishment of the Privatization Authority
Establishes the Privatization Authority under Section 8 to replace the Privatization Commission. The Authority will be managed by a Board consisting of a Presidentially-appointed Chairperson, Treasury Principal Secretary, Attorney-General, six independent members appointed through a competitive process, and a non-voting Managing Director (Section 10).
National Assembly Approval and Validity
Requires the Cabinet Secretary to submit the formulated Privatization Programme to the National Assembly for approval (Section 22). The National Assembly must consider the programme within 60 days of receipt and may approve, amend, or decline it (Sections 23, 25). Approved programmes are valid for a maximum of eight years (Section 29).
Strict Restrictions on Scheduled Public Entities
Under Section 40, any public entity undergoing privatization is barred from allowing its assets to dissipate or incurring liabilities outside the ordinary course of business without prior written approval from the Cabinet Secretary. Additionally, entities are forbidden from extending credit or providing financing for the purchase of their own shares (Section 42).
Establishment of the Privatization Appeals Board
Establishes a five-member Privatization Appeals Board under Section 52 to resolve disputes. Dissatisfied parties may lodge reviews with the Authority first, and then escalate to the Appeals Board within 15 days of a decision (Section 51 & Third Schedule). Decisions of the Appeals Board can be appealed to the High Court.
Up to KSh 5 Million Fine for Falsification of Information
Under Section 66 and 68, anyone who falsifies material information in a privatization proposal, provides false or misleading valuation details, or fails to provide requested information to the Authority within 14 days faces a fine not exceeding KSh 5 million, imprisonment for up to five years, or both.
Bill No.
No. 36 of 2025
Gazette No.
Supplement No. 127 of 2025
Sponsor
Kimani Ichung'wah
Background
The Privatization Bill, 2025 seeks to repeal and re-enact the regulatory framework for the privatization of public entities, replacing the Privatization Act, 2005 (No. 2 of 2005). The bill aims to improve the infrastructure and delivery of public services, reduce the drain on government resources, and optimize public asset utilization through private capital and expertise.
Key Amendments
- Privatization Authority: Establishes a corporate successor to the old Privatization Commission with enhanced powers to advise the government, implement privatization programmes, and evaluate individual proposals (Sections 8-9).
- Approved Methods of Privatization: Restricts privatization methods to initial public offers of shares, sales of shares by public tender, sales resulting from the exercise of pre-emptive rights, or other Cabinet-approved methods (Section 34).
- Privatization Appeals Board: Establishes a specialized tribunal consisting of a chairperson qualified to be a High Court Judge, an accredited arbitrator, and three other experienced members to handle dispute resolution (Section 53).
New Obligations
- Public Consultations: The Cabinet Secretary must consult the public, sector experts, and organizations representing affected persons when formulating any privatization programme (Section 20).
- Asset Valuations: The Authority must carry out a business and assets valuation for each scheduled entity using a qualified person before implementing any privatization proposal (Section 38).
- Record Keeping: Scheduled entities must keep up-to-date business records, maintain a register of all fixed assets, and document all legal obligations (Section 43).
Penalties
- KSh 5 Million Fine: Any individual who fails to provide required information to the Authority within 14 days, falsifies material details in privatization proposals, or unlawfully discloses insider information to give competitors an advantage, commits an offence and faces a fine of up to KSh 5 million, imprisonment for up to five years, or both (Sections 66, 68).
Transitional Provisions
- Succession of Authority: All rights, obligations, assets, and liabilities of the former Privatization Commission transfer directly to the newly established Privatization Authority (Section 72).
- Ongoing Privatizations: Privatization processes for entities published under Gazette Notice No. 8739 of 14th August 2009 must be finalized in accordance with the provisions of this new Act (Section 73).
- Staff Transition: Members and staff of the former Commission will transition to the Board and staff of the new Authority for their remaining unexpired terms (Sections 74-75).
No updates tracked yet
Updates will be visible here once they are approved and applied to this bill.