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Susan Maina is a Corporate Compliance Writer and Legal Researcher at M&A Registrars, a leading company secretarial and legal advisory firm. She specializes in developing clear, insightful content on Company Law, Corporate Governance, Regulatory Compliance, and Business Registration Services.
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Have you ever heard someone say, “I sold my shares in the company”, and wondered what that actually means in practice?
Maybe you are
In Kenya, all these situations are handled through a legal process known as Transfer of Shares in Kenya.
This guide by M&A Registrars explains the transfer of shares in Kenya in very simple terms. Let’s dive right into the discussion.
M&A Registrars can guide you step by step to complete your share transfer smoothly, efficiently, and fully compliant with Kenyan law.
Book a Free Consultation with M&A Registrars TodayWhatsAppTable of Contents
The process of Transfer of shares in Kenya simply means moving ownership of shares from one person to another.
Think of shares as small pieces of ownership in a company.
The person giving or selling the shares is known as the transferor, while the person receiving them is the transferee.
Once the process is completed, the transferee becomes the legal shareholder with rights to vote, receive dividends, and participate in profits or losses.
In Kenya, the transfer of shares is governed mainly by the Companies Act, 2015 (Section 326) and the company’s Articles of Association.
Generally in Kenya, any shareholder can transfer their own shares. However, in practice, this depends on the type of company and its internal rules.
For most private limited companies, share transfers are not automatic.
The transfer of shares in Kenya usually happens as a business grows, changes, or moves into a new phase.
It is a practical way for companies and shareholders to adjust ownership without disrupting the business itself.
Typical reasons include:
Example:
The clean, legal way to exit is through a transfer of shares in Kenya.
The process of transfer of shares in Kenya differs significantly depending on whether the company is private or public.
Understanding this distinction helps you know what approvals, documents, and filings are required.
| Aspect | Private Company | Public Company |
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Board approval
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Transfer restrictions
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Pre-emptive rights
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Filing requirements
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Practical complexity |
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Transferring shares in Kenya might sound complicated at first, but if you follow the steps carefully, the process is straightforward.
Here’s how you can transfer shares in Kenya and make sure everything is done correctly.
Step 1: Check Your Company’s Articles of Association
Before you do anything, look at your company’s Articles of Association.
This is the rulebook for your company and will tell you:
Tip: Skipping this step can lead to disputes or rejected filings later, so make sure you know the rules first.
Step 2: Agree With the Buyer
Next, you (the transferor) and the person receiving the shares (the transferee) need to agree on:
This agreement is usually written down in a Share Transfer Agreement.
Example:
Step 3: Get Board Approval (CR 19)
For private companies in Kenya, the Board of Directors must approve any share transfer. They do this through a Board Resolution (CR 19).
This step ensures your transfer complies with the company’s rules and the Companies Act, 2015.
Tip: Public companies don’t usually need board approval, as shares can be freely traded.
Step 4: Prepare the Share Transfer Documents
You now need to get all the paperwork ready. Key documents include:
Having all these documents ready makes the process smooth and avoids delays.
Step 5: Pay Stamp Duty
Stamp duty is mandatory in Kenya and is calculated at 1% of the value of the shares being transferred.
Example:
You are transferring 1,000 shares, each valued at KES 1,500.
Pay the stamp duty to KRA, and have the Transfer of Shares Form stamped at the Lands Office.
Step 6: File With the Registrar of Companies (BRS)
Finally, your company must file the updated ownership details with the Business Registration Service (BRS).
After filing:
Once this is done, the transferee becomes the legal shareholder, with all the rights to vote, receive dividends, and share in profits.
When you’re transferring shares in Kenya, having the right documents ready is essential.
These documents make the process legal, smooth, and compliant with the Companies Act, 2015.
| Document | What It Is / Why You Need It |
|---|---|
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Transfer of Shares Form
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Certificate of Marketable Securities (Form D)
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Board Resolution (CR 19)
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Board Minutes
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Share Transfer Agreement |
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IDs/ Passports |
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Existing Share Certificate
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Tip: Preparing all these documents in advance makes the transfer faster, prevents mistakes, and ensures compliance with both company rules and Kenyan law.
M&A Registrars can walk you through board approvals, documentation, stamp duty, and BRS filings — making the process simple, fast, and fully compliant.
Book a Free Consultation with M&A Registrars TodayWhatsAppTransferring shares in Kenya involves a few standard costs. Knowing what to expect helps you plan ahead and avoid surprises. Here’s a simple breakdown:
| Cost Item | What It Covers |
|---|---|
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Stamp Duty (1%) |
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Advocate Attestation |
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Company Secretarial Fees |
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BRS Filing & Compliance |
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Important:
There is no single flat rate.
Total costs depend on the value of the shares, whether the transfer is a gift or sale, and the complexity of the transaction.
Working with professionals like M&A Registrars can help you manage these costs efficiently while ensuring everything is compliant.
Yes, taxes apply when transferring shares in Kenya, but the type and amount depend on how the transfer is structured. Here’s what you need to know:
Stamp Duty (1%)
Capital Gains Tax (CGT)
Family Transfers
Tip for Beginners:
Even small share transfers can have tax implications.
Working with a company secretarial and corporate governance expert like M&A Registrars ensures you pay the right taxes and file the correct documentation.
1. How long does it take to transfer shares in Kenya?
If all your documents are ready and the necessary approvals are obtained, the transfer usually takes up to 14 working days. Complex transfers may take longer, especially if stamp duty assessment or board approvals are delayed.
2. Is board approval required for transfer of shares in Kenya?
Yes. For most private companies, the Board of Directors must approve the transfer before it can be officially registered. Public companies, however, generally do not require board approval.
3. Do you pay capital gains tax when transferring shares in Kenya?
Capital Gains Tax (CGT) applies only if you sell the shares at a profit. If the transfer is a gift or involves close family members, exemptions may apply. It’s best to consult a professional to confirm.
4. Can I transfer shares to my son without tax implications in Kenya?
Stamp duty of 1% still applies even for family transfers. CGT may be exempt depending on the circumstances, but you should get professional advice to be sure.
5. Does the company name change after a share transfer?
No. Only the ownership structure changes. The company remains the same legal entity, with the transferee becoming a registered shareholder.
The transfer of shares in Kenya determines who owns and controls a company.
While the concept is simple, the legal process requires proper approvals, documentation, tax compliance, and regulatory filings.
Mistakes at this stage can lead to disputes or future compliance problems. That’s why having experienced guidance is so important.
Working with a company secretarial and corporate governance expert like M&A Registrars ensures your share transfer is smooth, fully compliant, and legally sound, giving you peace of mind as a shareholder or business owner.
Click the WhatsApp button to book your free consultation with M&A Registrars now.
Or email us at info@mnaregistrars.com
WhatsAppIf you’re planning a transfer of shares in Kenya, having the right support can make the process simple, smooth, and fully compliant.
At M&A Registrars, we guide you through every step, including:
With our support, your share transfer is handled professionally, efficiently, and legally, so you can focus on your business without worrying about compliance issues.
We’ll guide you step by step, ensuring your share transfer is completed correctly, compliantly, and with confidence.
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