After an eleven-year delay, the Kenyan government has signaled a major overhaul in the regulatory framework governing Non-Governmental Organisations (NGOs) by activating the Public Benefit Organisations (PBO) Act of 2013. This move necessitates all NGOs within Kenya to re-register within the next 12 months under the PBO Act or face the cessation of operations.
The act, which was assented to by former President Uhuru Kenyatta in 2013, establishes a comprehensive regulatory and administrative framework for PBOs, aiming to streamline their roles and contributions within the country. The delay in the operationalisation of the law left many areas undefined; however, its activation marks a significant shift in how public benefit entities will operate moving forward.
Caroline Wanja, a senior manager for legal business solutions at Price Waterhouse Coopers (PwC), highlights that the new law refrains from mandating compulsory registration but rather incentivizes entities to register under the PBO Act to benefit from various privileges set out in the law. These benefits include tax incentives, eligibility for government funding, preferential treatment in public procurement, and access to training and information crucial for effective policy participation.
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Under the revised regime, no entity can claim the status of a PBO without being duly registered or officially recognized by the Authority through registration. This prerequisite is aimed at regulating the usage of the term ‘PBO’ and ensuring authenticity and compliance among entities engaging in public benefit activities.
One significant impact of the PBO Act’s enforcement is the repeal of the Non-Governmental Organisations Coordination Act of 1990 (NGO Act), which previously governed NGOs in Kenya. This change mandates NGOs, including those formerly exempted from registration under the NGO Act, to seek formal registration under the new PBO Act. Failure to comply places NGOs at risk of losing access to vital funding, as compliance with legal requirements is commonly a precondition for receiving financial support.
Consequently, NGOs that were registered under the repealed NGO Act are deemed to be registered under the PBO Act but are required to formalize their status through registration within a year from the commencement date of the new act.
This transition heralds a new chapter for NGOs operating in Kenya, positioning legal registration and compliance as cornerstones for their continued contribution to the public good within the nation’s evolving regulatory landscape.
