Incorporating A Public Benefit Organization (NGO) In Kenya

Kenya’s legal framework for non-profit entities changed significantly with the commencement of the Public Benefits Organizations Act, 2013 (“PBO Act”) on 14 May 2024 through Legal Notice No. 78 of 2024. The old NGO regime has now been replaced by a broader, more modern framework governing organizations that serve the public good.

For charities, NGOs, foundations, faith-based entities, international aid agencies, and social impact organizations, understanding the new regime is now essential.

What is the legal framework governing NGOs / Public Benefit Organizations in Kenya?

The primary law governing Public Benefit Organizations (PBOs), formerly referred to as Non-Governmental Organizations (NGOs), in Kenya is the Public Benefit Organizations Act, No. 18 of 2013 (the “PBO Act” or “the Act”). It establishes how such organizations are defined, registered, regulated, and granted benefits, replacing the previous emphasis on the NGOs Co-ordination Act, 1990.

The PBO Act draws its constitutional mandate from Articles 36 (freedom of association) and 37 (right to picket and petition) of the Constitution of Kenya, 2010, which guarantee the right of all persons to freely associate, form, and join associations of any kind, including civil society organizations.

Does the NGO Co-ordination Act (Cap. 134) still apply, and why has the PBO Act replaced it?

The NGO Co-ordination Act, Cap. 134 was the predecessor statute governing NGOs in Kenya for over two decades. It established the NGO Co-ordination Board and required organizations to register thereunder before commencing operations. However, the PBO Act, No. 18 of 2013, effectively repealed the NGO Co-ordination Act in its entirety upon full commencement.

The key reasons for the shift are:

• Broader scope of coverage: The PBO Act captures a wider range of civil society organizations beyond traditional development NGOs, including community-based organizations (CBOs), charitable trusts, associations, and foundations engaged in public benefit activities.
• Enhanced accountability: The PBO Act introduces more robust governance, financial reporting, and accountability requirements aligned with modern best practices.
• Rights-based approach: Unlike its predecessor, the PBO Act explicitly recognizes the constitutional rights of organizations to freedom of association and limits state interference, bringing the law in conformity with the Constitution of Kenya, 2010.
• Streamlined regulation: It establishes a single regulatory body, the Public Benefit Organizations Regulatory Authority (PBORA) replacing the NGO Co-ordination Board.

Transitional provisions under Section 78 of the PBO Act preserve the validity of registrations made under the NGO Co-ordination Act, pending re-registration under the new framework (discussed further below).

What is a Public Benefit Organization (PBO) under the PBO Act?

Section 5 of the PBO Act defines a PBO as a voluntary, autonomous, non-partisan and non-profit entity, whether membership‑based or not, established by individuals or legal persons to carry out public benefit activities. It may operate at local, national, or international level, but must pursue activities that fall within public benefit areas listed in the Sixth Schedule, such as education, health, poverty alleviation, environmental protection, human rights, and similar public-good fields.

What activities qualify as “public benefit activities”?

The Act defines a public benefit activity as any lawful activity that promotes public benefit by advancing legitimate economic, environmental, social, or cultural interests of individuals or the general public, as further elaborated in the Sixth Schedule. Illustrative sectors include relief of poverty, promotion of education, promotion of health, environmental conservation, advancement of human rights, and community development.

What does NOT constitute a Public Benefit Organization under the Act?

The PBO Act expressly excludes certain categories of organizations from its definition of a PBO. Under Section 5(2), the following are NOT considered PBOs:

• Political parties: Organizations whose primary objective is to contest or participate in political elections.
• Trade unions and employers’ associations: Registered under the Labour Relations Act.
• Cooperatives: Registered under the Co-operative Societies Act.
• Savings and credit organizations (SACCOs): Regulated under the Sacco Societies Act.
• Religious organizations: Purely religious bodies established solely for religious worship (though those engaged in developmental or charitable activities alongside religion may qualify).
• Government institutions: State corporations or parastatals established by statute.
• Profit-making entities: Any organization whose primary objective is commercial profit for its owners or shareholders.

What is the regulatory body for PBOs in Kenya?

The Public Benefit Organizations Regulatory Authority (PBORA), established under Section 34 of the PBO Act, is the principal government body responsible for regulating, facilitating, and promoting PBOs in Kenya. PBORA is the successor institution to the former NGO Co-ordination Board, which was established under the NGO Co-ordination Act.

What are the functions and powers of PBORA?

Under Section 42 of the Act, PBORA’s principal functions include:

• Receiving and processing applications for registration of PBOs;
• Maintaining a register of all registered PBOs in Kenya;
• Monitoring compliance by PBOs with the Act and their constitutions;
• Investigating complaints against PBOs and taking appropriate enforcement action;
• Promoting best practices in governance, accountability, and transparency among PBOs;
• Facilitating the networking and capacity-building of PBOs;
• Advising the government on policy matters relating to the PBO sector;
• Receiving and reviewing annual returns and financial reports from PBOs;
• Revoking or suspending registration of non-compliant PBOs (subject to due process and appeal rights);
• Publishing and maintaining an online public register of registered PBOs.

What are the categories of registration available under the PBO Act?

The PBO Act provides for three (3) primary registration categories, distinguished by the geographic origin of the organization and the scope of its intended operations:

What are the steps for registering a PBO in Kenya?

Registration of a PBO under the PBO Act follows the procedure outlined below:

1.  Search and Reservation: Conduct a name search with PBORA to confirm that the proposed name of the organization is available and not already in use. Submit a name reservation form with the preferred name and at least two alternatives. This process is charged at KShs 1,000.
2.  Drafting the Constitution: The organization must have a written constitution (also referred to as its trust deed or memorandum of association, depending on its legal form). The constitution must comply with the mandatory requirements of Section 8 (4) of the PBO Act, including the objects clause, governance structure, membership terms, financial management, dispute resolution, and dissolution procedure.
3. Convene Inaugural Meeting: The founding members must convene a meeting, adopt the constitution, elect the initial board/executive committee, and pass resolutions authorizing the registration application.
4. Prepare and Submit Application: File a formal application for registration with PBORA online through the e-Citizen platform. The application must be accompanied by the documents listed below.
5. Payment of registration/processing fees: Pay the required application fee, currently KShs 16,000 for a national PBO and KShs 30,000 for an international PBO. Retain the payment receipt as part of the file.
6. Application Review by PBORA: PBORA reviews the application for completeness and compliance within 60 days of application. PBORA may request clarification, additional documents, or an amendment of the constitution within a prescribed period.
7.  Issuance of Certificate of Registration: Upon satisfaction that all requirements are met, PBORA issues a Certificate of Registration. The certificate serves as legal proof of the PBO’s existence and authorizes it to operate within Kenya. The PBO is then entered into the official PBO Register.
8. Post-Registration Compliance: Following registration, the PBO should apply for a KRA PIN and tax exemptions where eligible. It should also open bank accounts and implement internal controls. Additionally, it must comply with ongoing obligations, including filing annual returns, financial reports, and any notifications of material changes to the authority.

What documents are required to register a PBO?

The following documents are required for submission to PBORA:

• Completed PBORA application form (prescribed by the Authority);
• Three (3) certified copies of the organization’s constitution/trust deed;
• Minutes of the inaugural/founding meeting, signed by the Chairperson and Secretary;
• A list of founding members/board members with their full names, (must be at least 5) nationalities, ID/passport numbers, and physical addresses;
• Passport-sized photographs of all board members;
• Copies of national identity cards or passports of all board members;
• A brief description of the programs and activities the PBO intends to undertake;
• A proposed operational work plan and budget for the first year;
• For foreign PBOs: a certified copy of the parent organization’s registration certificate from its home country, and a resolution of the parent organization’s board authorizing the Kenya registration;
• Evidence of a physical address / registered office in Kenya (e.g., lease agreement, utility bill);
• Payment receipt for applicable registration fees.

How can an international NGO operate in Kenya under the PBO Act?

A foreign PBO must apply for registration with PBORA in the same manner as a local PBO, submitting a certified copy of its home-country registration, constitutional documents, board authorization resolution, and a Kenya-specific work plan and budget. On review of the application, the Authority can:

1. Exempt the organization from registration and grant a permit to operate in Kenya in the event the intended activities or programmes are not directly implemented in Kenya or operate from Kenya and implement the activities or programmes in another country; and
2. Require the organization to apply for registration as an international organization where the organization intends to directly implement its activities or programmes in Kenya or operate from Kenya to implement activities or programmes in another country.

The Act further prescribes the need for the international PBO to have at least one-third of its directors as Kenyan citizens who are resident in Kenya and maintain an office in Kenya.

What specific requirements apply to international PBOs?

Common requirements include:

• Submission of minutes/resolution authorizing Kenya registration.
• A certified copy of the organization’s constitution or charter.
• Proposed Kenyan office and postal address.
• Appointment of a Kenyan citizen as the organization’s agent or representative in Kenya.
• Demonstrating that at least one-third of the governing board are Kenyan citizens (a common regulatory expectation to enhance local governance, per current practice).

What happens to NGOs already registered under the NGO Co-ordination Act before the PBO Act came into force?

The PBO Act contains transitional provisions under Part VII, Section 71, and Fifth Schedule to manage the migration from the old regime to the new framework. The key transitional provisions are:

1. Preservation of existing registrations: All organizations that were duly registered under the NGO Co-ordination Act immediately before the commencement of the PBO Act are deemed to be registered under the PBO Act for a transitional period. They do not lose their legal status upon the Act’s commencement.
2. Mandatory re-registration: All such organizations are required to apply for fresh registration (re-registration) under the PBO Act within the period stipulated by the PBORA, which was originally set at one (1) year from the Act’s operationalization date of 14^th May 2024, but has been subject to extension to 13^th May 2026.
3. Consequences of Non-Compliance: An organization that fails to re-register within the prescribed transitional period loses its PBO status and ceases to enjoy the benefits and rights conferred by the PBO Act, including tax exemptions. PBORA may also strike such an organization off the register.
4. Continuity of Rights: The transition does not affect the rights, obligations, assets, or liabilities of an organization. All agreements entered into under the old law remain valid and enforceable.
5. Constitution Update: Constitutions to be brought into conformity: Organizations must review and, where necessary, amend their constitutions to bring them into conformity with the minimum constitutional requirements prescribed under Section 8 (4) of the PBO Act.

What are the Public Benefits Organizations Regulations, 2026, and why do they matter?

The Public Benefits Organizations Regulations, 2026 are the new implementing rules that give full practical effect to the PBO Act, 2013 by setting out how PBOs are registered, categorized, governed, and supervised in Kenya. They replace the old NGO-era regulations, clarify categories such as national and international PBOs, introduce a clear public benefit test, prescribe governance and reporting standards, and fix transition and compliance timelines for previously registered NGOs so that all must align with the PBO framework or risk loss of status and benefits. The Regulations took effect on 18 March 2026, subject to parliamentary scrutiny under the Statutory Instruments Act. They remain in force unless annulled by Parliament.

What is the Public Benefit Organizations Tribunal, and what is its role?

The PBO Act establishes a specialist Tribunal to handle disputes, appeals, and grievances arising under the Act between PBOs, PBORA, and other stakeholders. It functions as a quasi‑judicial body providing sector‑specific dispute resolution.

What matters fall within the Tribunal’s jurisdiction?

The Tribunal has jurisdiction to hear and determine:

1. Appeals by any person or organization aggrieved by a decision of PBORA, including refusal to register, suspension, or deregistration;
2. Disputes between PBOs and PBORA relating to compliance notices, financial reporting requirements, or penalties;
3. Disputes between members of a PBO and its board or management that have been referred to the Tribunal pursuant to the Act;
4. Complaints by third parties (including members of the public) against a registered PBO for alleged breach of its constitution or the Act;
5. Any other matter that the Act expressly confers jurisdiction upon the Tribunal to determine.

What are the key governance requirements for a registered PBO?

Section 8 (4) & (5) of the PBO Act sets out the minimum constitutional requirements. Every PBO’s constitution must provide for:

• The name and physical address of the organization;
• Its vision, mission, and objectives (which must be of a public benefit nature);
• Categories and rights of membership;
• The governance structure, including a board of directors/trustees, their powers, tenure, and removal;
• Financial management procedures, including signatories, audits, and annual accounts;
• Conflict of interest policies;
• Procedures for amending the constitution;
• Dissolution and winding-up procedures, specifying that upon dissolution, residual assets must be transferred to another PBO or charitable purpose (assets cannot revert to members).

What are the benefits of obtaining PBO registration in Kenya?

Registration as a PBO under the PBO Act confers a range of significant legal, fiscal, and operational advantages:

Frequently Asked Questions (FAQ)

Q: What is the difference between an NGO and a Foundation?
A: There is hardly any difference between the two. A foundation is registered the same way an NGO is.

Q: How many directors are needed to register an NGO?
A: Five (5) Directors are needed to register an NGO. One third (1/3) of all the board members MUST be Kenyan for all foreign-based NGOs.

Q: What is the duration of the registration process?
A: The registration process takes a minimum of 90 working days.

Q: Can a PBO distribute profits to founders or members?
A: No. A PBO must be non-profit and may not distribute surpluses to founders, members, or management; all income and assets must be applied to its public benefit objects. Reasonable compensation for services is permitted, but profit-sharing or dividends are inconsistent with PBO status.

Q: Can a PBO engage in income‑generating activities?
A: Yes, provided such activities support or are ancillary to its public benefit objects and profits are fully ploughed back into public benefit work. Tax treatment of such activities depends on KRA rules on unrelated business income and exemption conditions.

Q: Do we need a local office?
A: Yes, a physical office in Kenya is a mandatory requirement for registration.

Q: Can a PBO be formed by a single individual?
A: No. A PBO must be formed by a minimum of two (2) individuals or organizations. The Act requires a collective of founders (often called promoters or founding members) who collectively adopt the constitution and establish the governance structure of the organization.

Q: Do religious/ faith‑based organizations qualify as PBOs?
A: Faith‑based entities can qualify as PBOs if their primary activities fit within public benefit categories (e.g., education, health, relief of poverty) and they meet governance and non‑profit criteria. Purely worship and confessional or member‑only entities may not satisfy the broader public benefit test.

How can Njaga & Co Advocates LLP support clients in incorporating and regularizing PBOs/NGOs?

Njaga & Co. Advocates LLP brings extensive experience in civil society law, regulatory compliance, and organizational governance to every PBO matter. Our dedicated team is equipped to guide your local or international organization through every stage of the incorporation and post-registration process.

Our Services in PBO / NGO Matters Include:

• Constitution Drafting & Review: Name search and reservation with PBORA; Drafting constitutions, trust deeds, and governance frameworks fully compliant with the PBO Act; Reviewing and amending existing constitutions to ensure conformity with the PBO Act;
• Registration & Re-registration: Preparation and filing of all PBORA registration documents; Re-registration of former NGOs under the PBO Act within transitional timelines; Registration of foreign/ international PBOs;
• Regulatory Compliance: Representation before PBORA on compliance matters; Advice on anti-money laundering, tax exemption applications, and foreign funding compliance;
• Dispute Resolution: Representation of PBOs before the Public Benefit Organizations Tribunal; Internal dispute resolution between members and management; Litigation before the High Court on PBO-related matters;
• Immigration Advisory: Work permits for expatriate PBO staff (Class G, I, Q permits and related immigration advisory); Dependent pass applications and immigration compliance for international staff;
• Ongoing Legal Retainer: Ongoing legal advisory on governance, employment, intellectual property, and contractual matters; Drafting employment contracts, MoUs, grant agreements, and vendor contracts for PBOs.

Contact us today to ensure your organization’s mission is built on a solid, compliant legal foundation under the new PBO regime.

Disclaimer: This article provides general information and does not substitute legal advice on specific circumstances of any individual or organization. While the information is accurate as of the date published, we cannot guarantee it remains accurate at the time you read it or that it will stay current. Before acting on any of this information, please seek professional legal advice tailored to your situation.