Unemployment Looms as Govt Shuts Down 98 Companies

Several Kenyans risk losing their jobs after the Registrar of Companies, Joyce Koech, announced plans to dissolve 98 Kenyan companies.

Koech, in a gazette notice dated Friday, January 31, noted that the listed companies would be struck off the register in line with Section 897(3) of the Companies Act. Section 897(3) grants the Registrar of Companies the authority to strike a company’s name off the Register of Companies if the company has not been carrying on business or in operation for a specified period.

The registrar went ahead to invite Kenyans with any reservations concerning the dissolution of the aforementioned companies to show cause as to why they should not be dissolved.

“Under Section 897 (3) of the Companies Act, the Registrar of Companies gives notice that the names of the companies set out in the schedule hereto, shall, unless cause is shown to the contrary, be struck off the register of companies and the companies shall be dissolved,” read the notice.

Notably, most of the companies listed by the Registrar of Companies were privately owned firms that operated within the country and beyond Kenya’s jurisdiction.

Among the companies listed were firms that deal in the manufacture of pieces of machinery such as generators, pressure washers, mixers, vibrators, and water pumps.

Another is a privately owned company established in 2015 that develops run-of-river electric power projects in Kenya and other Sub-Saharan African countries.

Others are firms that deal in the assembly and sale of motor vehicles in the country, while others deal in the processing of timber and manufacture of furniture.

Similarly, some of the companies operate real estate, which facilitates the buying, selling, or renting of properties and even land on behalf of their clients. Specifically, they help in negotiating the terms of the deal and ensuring a fair and satisfactory agreement between the buyer and the seller.

There are several reasons and circumstances when a company can be liquidated or deregistered by the Registrar of Companies under the Companies Insolvency Rule.

For instance, if the court gives a winding-up order, then the Registrar of Companies could announce the dissolution of the firm. A firm can also be dissolved if it defaults in delivering a statutory report to the registrar.

Similarly, a company can be dissolved if it ceases its operations. The application to be struck off the register can only be made if a company has not changed its name or has not changed the type of business it conducts.