The Local Content Bill, 2023

24 Nov 2023 domainSenate Senate Bills No. 50 of 2023 Gazette: Supplement No. 224
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Status Timeline

Proposed

Active now

Public Review

Pending

Debate

Pending

Executive

Pending

Final

Pending

1

Establishment of the Local Content Development Committee

Establishes the Local Content Development Committee under Section 9 to coordinate the development of local content, evaluate and approve local content plans, and assess local industry capabilities to supply goods and services.

2

Mandatory Local Content and Subsidiary Plans

Requires operators, before bidding or applying for a licence, to prepare and submit a long-term local content plan (Section 22). This must incorporate subsidiary plans for:

  • Employment and skills development
  • Research and development
  • Technology transfer
  • Financial services
  • Succession planning for positions held by non-citizens
3

Thirty Percent Local Quota and Bidding Preferences

Mandates that local content activities include local participation at a quota of not less than 30% (Section 7). Operators must maintain a bidding process providing fair opportunity to local companies, giving preference to local persons where the price differential does not exceed 10% (Section 41).

4

Indigenous Banking and Financial Requirements

Requires operators and connected entities to open and maintain bank accounts with indigenous Kenyan banks (defined as having 100% or majority Kenyan shareholding) and transact business through banks in Kenya (Section 38).

5

Fines of Up to KSh 3 Million for Violations

Introduces strict penalties under Section 54:

  • Knowingly making false statements in plans or reports is subject to a fine of up to KSh 2 million, imprisonment for up to 3 years, or both.
  • Actively fronting or conniving to pass off a foreign entity as an indigenous Kenyan company carries a fine of up to KSh 3 million, up to 5 years imprisonment, or both.
  • General non-compliance with local content requirements faces a fine of 5% of the proceeds of the activity (capped at KSh 2 million) or contract cancellation.

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