Structuring Foreign Direct Investment (FDI) in Kenya: Special Economic Zones & Local Equity Rules
Faith Cherono, Managing Partner
Advocate of the High Court of Kenya • CCA Advocates
Kenya stands as the premier commercial gateway to the East and Central African market of over 300 million people. However, international corporations establishing operations here must skillfully navigate regulatory clearances, tax treaties, and sector-specific local equity mandates.
Special Economic Zones (SEZs) vs. Export Processing Zones (EPZs)
Kenya’s Special Economic Zones Act 2015 provides compelling incentives for manufacturing, tech, and service hubs, including a reduced 10% corporate income tax rate for the first decade, exemption from VAT, customs duties remissions, and accelerated work permit processing for foreign technical staff.
Sector-Specific Ownership Restrictions
While Kenya generally welcomes 100% foreign ownership of commercial enterprises, certain regulated sectors — such as telecommunications, insurance, and aviation — enforce local shareholding quotas that require strategic structuring, shareholder agreements, and compliant voting trusts.
Faith Cherono
Founding & Managing Partner • CCA Advocates
Faith advises corporate entities, technology scale-ups, and private investors on corporate governance, M&A, cross-border commercial transactions, and dispute resolution.