This Act may be cited as the Nairobi International Financial Centre Act, 2017.
In this Act, unless the context otherwise requires—
means the Nairobi International Financial Centre Authority established under section 5;
means the Board of directors of the Authority constituted under section 8;
means the Cabinet Secretary for the time being responsible for matters relating to finance;
means the Nairobi International Financial Centre established under section 4;
means the Steering Council established under section 19;
means a person certified as such by the Authority under section 28 (4);
includes a company, association or other body of persons whether incorporated or unincorporated;
includes the Central Bank of Kenya, the Capital Markets Authority, the Insurance Regulatory Authority, the Retirement Benefits Authority, and the Sacco Societies Regulatory Authority or their successors thereof;
means the Financial Centre Tribunal established under section 35; and
refers to an activity designated as such by the Cabinet Secretary under section 27.
Where there is any conflict or inconsistency between this Act and the provisions of any other Act in matters relating to the purpose of this Act, this Act shall prevail.
There is established the Nairobi International Financial Centre.
The Centre shall be an operating framework managed by the Authority in order to facilitate and support the development of an efficient and globally competitive financial services sector in Kenya.
There is established the Nairobi International Financial Centre Authority.
The Authority shall be a body corporate with perpetual succession and a common seal, and shall, in its corporate name, be capable of—
suing and being sued;
taking, purchasing or otherwise acquiring, holding, charging or disposing of movable and immovable property;
borrowing or lending money;
entering into contracts; and
doing such other acts necessary for the proper performance of the functions of the Authority.
The Authority shall be the successor to the Nairobi International Financial Centre Authority established under the Nairobi International Financial Centre Authority Order (L.N. 44/2014).
Subject to this Act, all rights, duties, obligations, assets and liabilities of the Nairobi International Financial Centre Authority existing at the commencement of this Act shall be automatically and fully transferred to the Authority.
The objectives of the Authority shall be to—
establish and maintain an efficient operating framework in order to attract and retain firms;
develop and recommend strategies and incentive structures in collaboration with relevant agencies in order to attract firms to be Nairobi International Financial Centre firms (hereinafter referred to as NIFC firms); and
review and recommend, in collaboration with the relevant regulatory authorities developments to the legal and regulatory framework in order to develop Kenya as an internationally competitive financial centre.
In order to realise its objectives, the Authority shall have powers and functions to—
formulate and implement policies relating to the establishment, operations and administration of the Centre;
develop, in collaboration with other relevant agencies, the necessary infrastructure to support the conduct of qualified activities;
certify firms to conduct activities under the Centre;
review and recommend in consultation with the relevant agencies, the development of legal, the regulatory and institutional framework including mechanisms for judicial redress for the purposes of aligning them to the needs of the Centre;
impose administrative penalties for breach of any rules, regulations or directives;
determine, impose and levy, in consultation with the Cabinet Secretary, any rates, charges or fees for any services rendered by the Authority;
promote the Centre as the leading operating framework for financial services and related activities;
co-operate and enter into association and agreements with local and international bodies, institutions and organizations to support the functions of the Authority; and
undertake any other activity necessary for the fulfilment of its objectives under this Act.
The management of the Authority shall vest in a board of directors which shall comprise—
a non-executive chairperson appointed by the President;
the Cabinet Secretary responsible for matters relating to finance, or a representative appointed in writing by the Cabinet Secretary;
the Cabinet Secretary responsible for matters relating to international trade, or a representative appointed in writing by the Cabinet Secretary;
the Attorney-General, or a representative appointed in writing by the Attorney-General;
four other persons with relevant international financial services experience appointed by the Cabinet Secretary; and
the Chief Executive Officer who shall be an ex-officio member with no right to vote.
A person qualifies to be appointed as the chairperson under subsection (1)(a) if the person—
holds a degree from a university recognized in Kenya;
has at least fifteen years' experience at a senior management level in—
finance, economics, banking, insurance or capital markets;
corporate or financial services law; or
any other field that is relevant to the functions of the Authority; and
meets the requirements of Chapter Six of the Constitution of Kenya.
The Chairperson and members of the Board appointed under section 8(1)(a) and (e) respectively shall serve for a term of three years and shall be eligible for re-appointment for one further term of three years.
The appointment of members of the Board shall be done in such a manner as to ensure that the terms of the members appointed do not lapse at the same time and that there is continuity of service.
The procedures for the conduct of business and affairs of the Board shall be as set out in the Schedule.
Except as provided in the Schedule, the Board may regulate its own procedure.
The Board shall have all the powers necessary for the performance of the functions of the Authority under this Act.
Without prejudice to the generality of the foregoing, the Board shall have the powers to—
lay down the general policies and plans for the Authority in accordance with international best practices;
prepare the annual budget of the Authority for the purpose of funding the administrative activities of the Centre;
administer the assets and funds of the Authority in such a manner and for such purposes as shall promote the best interests of the Authority;
receive grants, donations or any other moneys on behalf of the Authority and make legitimate disbursements therefrom;
open such banking accounts for the funds of the Authority as may be necessary;
ensure the Authority is run at all times in accordance with this Act and best international practices; and
perform any other function necessary to achieve the objectives of the Authority.
The Board may, by resolution either generally or in any particular case, delegate to a committee of the Board, or to any member, officer, employee or agent of the Authority, the exercise of any powers or the performance of any functions or duties of the Board under this Act or any other written law.
The chairperson and members of the Board shall be paid such remuneration or allowances as the Authority may, in consultation with the Salaries and Remuneration Commission, determine.
There shall be a Chief Executive Officer of the Authority who shall be competitively recruited and appointed by the Cabinet Secretary on the recommendation of the Board.
The Chief Executive Officer shall serve on such terms and conditions of employment as the Board may, in consultation with the Cabinet Secretary, determine.
A person qualifies to be appointed as the Chief Executive Officer if that person—
holds a degree from a university recognized in Kenya;
has at least ten years' experience at a senior management level in—
banking, insurance or capital markets;
finance or economics;
corporate or financial services law; or
such other field that is relevant to the functions of the Authority;
has relevant experience in the development of the financial services sector; and
meets the requirements of Chapter Six of the Constitution of Kenya.
The Chief Executive Officer shall, subject to the directions of the Board, be responsible for the day-to-day management of the Authority.
The Chief Executive Officer shall hold office for a term of four years and shall be eligible for re-appointment for one further term of four years.
The Authority may appoint such staff as are necessary for the performance of its functions under this Act.
The staff appointed under subsection (1) shall serve on such terms and conditions of service as the Authority may, in consultation with the Salaries and Remuneration Commission, determine.
No matter or thing done by any member of the Board or by any officer, employee, agent or servant of the Authority or Tribunal shall, if the act or omission was done in good faith for the purpose of performing the functions of the Authority or Tribunal under this Act, render the person liable for any action, claim or demand.
A director, officer, employee or agent of the Authority or any person who for any reason has access to any record, document, material or information relating to the affairs of the Authority which that person acquires through the performance of his or her duties or the exercise of his or her functions shall not divulge, use for personal gain, publish or otherwise disclose to any person such document, material or information unless the disclosure is required—
to be disclosed under any law;
for the performance of his or her duties or the exercise of his or her functions under this Act; or
by a court of law.
This section shall not apply to any document, material or information which at the time of disclosure is, or has already been made lawfully available to the public.
A person who has any document, material or information which to his or her knowledge has been disclosed in contravention of subsection (1) shall not disclose, in any manner, the document, material or information to any other person.
A person who contravenes subsection (1) or (3) shall be liable on conviction to a fine not exceeding two hundred thousand shillings or to imprisonment for a term not exceeding three years or to both.
The common seal of the Authority shall be kept in such custody as the Board may direct and shall not be used except on the order of the Board.
The affixing of the common seal of the Authority shall be authenticated by the signature of the Chairperson and the Chief Executive Officer and any document not required by law to be made under seal and all decisions of the Board may be authenticated by the signatures of both the Chairperson and the Chief Executive Officer.
Notwithstanding the provisions of subsection (2), the Board shall, in the absence of either the Chairperson or the Chief Executive Officer in a particular matter, nominate one member to authenticate the seal on behalf of either the Chairperson or the Chief Executive Officer.
The common seal of the Authority when affixed to a document and duly authenticated shall be judicially and officially noticed unless the contrary is proved, any necessary order or authorization by the Board under this section shall be presumed to have been duly given.
There is established a Steering Council which shall consist of the—
President as the chairperson;
Deputy President as the deputy chairperson;
Cabinet Secretary responsible for matters relating to finance;
Attorney-General;
Governor of the Central Bank of Kenya;
Chief Executive Officer of the Capital Markets Authority;
Chief Executive Officer of the Insurance Regulatory Authority;
Chief Executive Officer of the Retirement Benefits Authority; and
Chairperson of the Authority.
The Authority shall provide secretariat services to the Council.
The Council may from time to time, co-opt any person to advise on a specified matter.
The Council—
shall review the progress of the Centre, provide direction and address any challenges in the development of the Centre and the overall financial services sector in Kenya; and
may, from time to time, give such directions to any person which the Council considers necessary in order to achieve the objectives of this Act.
The Council shall meet at least three times in a year and shall regulate its own procedure.
The funds of the Authority shall consist of—
such monies or assets which may accrue to or vest in the Authority in the course of the exercise of its powers or the performance of its functions under this Act;
any monies which may become payable to the Authority pursuant to this Act or any other written law;
monies as may be appropriated by the National Assembly for the purposes of the Authority; and
all monies from any other source provided, donated or lent to the Authority.
The Authority may invest any of its funds in securities in which for the time being trustees may by law invest in trust funds, or in any other securities which the National Treasury may, from time to time approve.
The Authority may place or deposit with any bank as it may determine, any monies not immediately required for the purposes of the Authority.
The financial year of the Authority shall be the period of twelve months commencing on the first of July and ending on thirtieth of June in each year.
The Board shall, at least three months before the commencement of each financial year, cause to be prepared estimates of revenue and expenditure of the Authority for that financial year.
The annual estimates shall make provisions for all the estimated expenditure of the Authority for the financial year concerned, and in particular, shall provide for the—
payment of salaries, allowances and other charges in respect of the Board and staff of the Authority;
rental expenses for the premises of the Authority;
payment of pensions, gratuities and other charges in respect of retirement benefits to the staff of the Authority which are payable out of the funds of the Authority;
effective development and promotion of the Centre in Kenya and overseas;
running of the certification, registry, dispute resolution and external entity coordination activities of the Authority;
proper maintenance, repair and replacement of equipment and other movable property of the Authority; and
payment of any other costs as may be incurred by the Authority.
The Board shall approve the annual estimates before the commencement of the financial year to which they relate and shall submit the same to the Cabinet Secretary for approval.
The Board shall cause to be kept proper books and records of accounts of income, expenditure, assets and liabilities of the Authority.
Within a period of three months after the end of each financial year, the Board shall submit to the Auditor-General the accounts of the Authority in respect of that financial year together with—
a statement of income and expenditure of the Authority during the year;
a statement of assets and liabilities of the Authority on the last day of that year; and
a funds flow statement during that year.
The accounts of the Board shall be audited and reported upon in accordance with the provisions of the Public Audit Act, 2015 (No. 34 of 2015).
The Board shall, within three months after the end of each financial year, prepare and submit to the Cabinet Secretary, an annual report for the immediate preceding financial year.
The Cabinet Secretary shall lay the annual report before the National Assembly as soon as is practicable.
A person shall not conduct any qualified activity as an NIFC firm or hold itself out as such unless that person is certified by the Authority under this Act.
A person who contravenes the provisions of subsection (1) commits an offence and is liable on conviction to a fine not exceeding ten million shillings or to imprisonment for a term not exceeding five years or to both.
Where the offence is committed by a body corporate, the body corporate shall be liable on conviction to a fine not exceeding ten million shillings.
A certified firm may conduct any business activity which the Cabinet Secretary may designate in the Gazette as a qualified activity.
Despite subsection (1), a person shall not conduct a qualified activity for which a licence from a regulatory authority is required, unless that person has obtained the appropriate licence from the regulatory authority.
A person who intends to operate as an NIFC firm shall apply to the Authority, in the prescribed form, to be certified as such.
An application under subsection (1) shall be accompanied by the prescribed application fee and any other additional information as the Authority may require.
The Authority shall, in considering an application for certification under subsection (1), be satisfied as to the ability of the applicant to meet the prescribed conditions for certification in line with the objectives of the Centre.
The Authority may—
subject to the payment of the prescribed fee and to such conditions as the Authority may consider necessary, certify a firm to operate as an NIFC firm; or
decline to certify a firm.
Where the Authority declines to certify a firm under subsection 4(b), the Authority shall—
notify the applicant of its decision to do so setting out the reasons for the decline; and
grant the applicant an opportunity to be heard.
A certification granted under this Act shall remain in force until—
withdrawn or suspended by the Authority; or
voluntarily surrendered by the firm.
An NIFC firm shall pay an annual fee as the Authority may prescribe from time to time.
The Authority may—
impose such fees as are necessary in relation to NIFC firms; and
prescribe different fees in respect of different classes of NIFC firms or activities carried out by such firms.
The Authority may withdraw the certification of a firm if—
the Authority is satisfied that any information furnished in connection with an application for certification was false or misleading;
the firm has contravened or failed to comply with this Act, any direction or guideline issued or condition attached to the certification;
the firm has engaged in a prohibited activity;
the regulatory authority has withdrawn or revoked the firm's licence;
the certified firm has conducted its affairs in a manner which threatens the interests of its customers;
the certified firm is in violation of any other law; or
it is in the interest of the public to do so.
The Authority may, instead of withdrawing a certification under subsection (1), suspend the certification for a specified period or impose conditions or restrictions on the certification.
Where the Authority withdraws a certification under subsection (1), the Authority shall inform the relevant regulatory authority of its decision to do so and the firm shall immediately lose its status as an NIFC firm.
Where the Authority suspends or imposes conditions on the certification under subsection (2), the Authority shall inform the relevant regulatory authority of its decision to do so setting out the period of suspension and the conditions imposed.
The Authority shall not withdraw or suspend a certification under this section without first giving that person an opportunity to be heard.
The Authority shall keep a register of all NIFC firms.
The Authority shall make public the register kept under subsection (1) and any other information relating to the NIFC firms which the Authority considers appropriate by placing it on the Authority's website.
The Authority may, in collaboration with the relevant regulatory authority, cause an inspection to be made by an authorized person, of an NIFC firm and its books and records to ascertain if the NIFC firm continues to meet the conditions of certification.
Despite any provision to the contrary in any other law or regulation, an NIFC firm shall, subject to the provisions of this Act or regulations—
not be subject to any nationalisation or expropriation measures or any restrictions on private ownership;
have freedom to repatriate profits and realise investments;
have the freedom to recruit and employ staff of their choice on such terms as they wish to agree, subject to work permit provisions and any international treaty obligations entered into by the Government in respect of the terms of employment of employees; and
be capable of being owned up to one hundred percent by persons who are not nationals of, or resident in, Kenya.
Where there is a dispute between the Authority and an NIFC firm arising out of or in connection with the rights and benefits conferred by section 32, the dispute shall be settled by arbitration, and, unless otherwise agreed by the parties, by a sole arbitrator, to be appointed by the Registrar of the Nairobi Centre for International Arbitration and any award, order or determination of or by such arbitrator shall be final and binding on all parties.
The dispute referred to the arbitrator appointed by the Registrar under subsection (1) shall be administered in accordance with the Rules for arbitration of the Nairobi Centre for International Arbitration.
Without prejudice to the generality of the powers conferred under this Act, the Authority may formulate rules or issue guidelines as may be required in order to perform its functions under this Act.
There is established an appeals tribunal to be known as the Financial Centre Tribunal which shall consist of the following members appointed by the Judicial Service Commission—
a Chairperson with ten years' experience in adjudicating financial services and regulatory disputes; and
four other members with seven years' experience in the financial services sector.
The Chairperson and the members of the Tribunal appointed under subsection (1) shall—
be of good character; and
meets the requirements of Chapter Six of the Constitution of Kenya.
The Chairperson and members of the Tribunal shall be appointed for a term of three years renewable for one further term of three years.
The appointment of members to the Tribunal shall be done in such a manner as to ensure that the terms of the members appointed do not lapse at the same time and that there is continuity of service.
The Chairperson and any member of the Tribunal may be removed from office if the Chairperson or member—
becomes incapable through ill-health of effectively performing the duties of his or her office;
accepts any position of employment the holding of which conflicts with his or her role in the Tribunal;
is declared bankrupt;
is convicted of a criminal offence;
fails to attend three consecutive meetings of the Tribunal without the permission of the Tribunal;
resigns; or
dies.
The Chairperson and members of the Tribunal shall be paid such remuneration and allowances as the Judicial Service Commission may, in consultation with the Salaries and Remuneration Commission from time to time, determine.
The Tribunal shall have jurisdiction to hear and determine appeals against any decision or order of the Authority.
In determining an appeal, the Tribunal may affirm, quash or refer the decision or order back to the Authority for reconsideration.
The Judicial Service Commission shall appoint the Secretary to the Tribunal.
The Judicial Service Commission may appoint such staff as are necessary for the performance of the functions of the Tribunal under this Act.
The staff appointed under subsection (1) shall serve on such terms and conditions as the Judicial Service Commission may, in consultation with the Salaries and Remuneration Commission from time to time, determine.
No matter or thing done by any of the member of the Tribunal shall, if the act or omission was done in good faith for the purpose of exercising the powers of the Tribunal under this Act, render the person liable for any action, claim or demand.
The Chief Justice shall lay down the rules and procedures of the Tribunal in accordance with fundamental dispute resolution principles and international best practices.
Without prejudice to the generality of subsection (1), the Rules may make provisions relating to—
the way in which applications for review are to be made;
the procedure to be adopted by the Tribunal;
the nature of records to be kept;
the procedure of giving notice to the parties;
the fees to be charged; and
costs.
The provisions of the Civil Procedure Act (Cap. 21) shall apply to the claims submitted before the Tribunal, where this Act, its Regulations and the Rules and procedure are silent on the concerned matter.
The Cabinet Secretary may, on the recommendation of the Authority, make Regulations generally for the better carrying out the purposes and objectives of this Act.
Without prejudice to the generality of subsection (1), the Regulations may—
designate qualified activities to be conducted by NIFC firms;
determine any benefits, exemptions and incentives available to NIFC firms;
determine the general conditions of entry of firms to the Centre;
provide for the certification process of NIFC firms;
provide for the payment of compensation and penalties or fines in the event of a breach of the provisions of this Act or its regulations;
prescribe information required of NIFC firms; and
address any other matter required in order to achieve the objectives of this Act.
In this Part, "former Authority" means the Nairobi International Financial Centre Authority established under the Nairobi International Financial Centre Authority Order, 2014 (L.N. 44/2014).
The Nairobi International Financial Centre Authority Order, 2014 (L.N. 44/2014) is revoked.
Despite the revocation under subsection (1)—
the funds, assets and other property, both movable and immovable, which immediately before the commencement of this Act were vested in the former Authority shall, upon commencement of this Act, be vested in the Authority;
the annual estimates of the former Authority for the financial year shall, upon commencement of this Act, be deemed to be annual estimates of the Authority for the remainder of the financial year;
all rights, powers and liabilities whether arising under any written law or otherwise which immediately before the commencement of this Act were vested in, imposed on or enforced against the former Authority shall, upon commencement of this Act, be deemed to be vested in, imposed or enforceable against the Authority; and
any person who was a member of staff of the former Authority shall, upon commencement of this Act, be deemed to be a member of staff of the Authority for the remaining period of his or her service.