Investors investing in the SEZs and Kenya at large are guaranteed security of their investments through the following provisions.
1. Right to own property
Kenya is a sovereign state that upholds the rule of law. The Constitution of Kenya (2010), which is the supremelaw of the land, provides for the right to property and investment under Article 40.
2. Liberalized Economy
Kenya operates a liberal economy which promotes trade and investment. The country abolished price and exchange controls in 1993 through the repeal of the Exchange control Act. Further, for SEZs, foreign accounts and foreign borrowing is allowed.
3. Guarantee Against Expropriation
The Constitution of Kenya (2010) and the Special Economic Zones Act provide a guarantee against expropriation of private property, except for reasons of security or public interest. In such a case, a fair and prompt compensation is guaranteed.
4. Repatriation of Capital and Profits
Kenya guarantees capital repatriation and remittance of dividends and interest to foreign investors, who are free to convert and repatriate profits as per the Foreign Investment Protection Agreement (FIPA) Act - Cap 518.
5. Investors can repatriate:
After tax profits, including retained profits which have not been capitalized
The proceeds of the investment after payment of the relevant taxes
Principal and interest associated with any loan
6. Investment Dispute Arbitration
Kenya is also a member of the International Centre for Settlement of Investment Disputes (ICSID), and of the Africa Trade Insurance Agency (ATIA). Other Guarantees
Kenya is a member of the World Bank Afliated Multilateral Investment Guarantee Agency (MIGA), which issuesguarantees against non-commercial risk to enterprises that invest in member countrie