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Practise Area: Regulatory Law

INTRODUCTION

A Public Benefits Organization (PBO) is defined as a voluntary membership or non-membership grouping of individuals or organizations which is autonomous, non-partisan, non-profit making, and which is organized and operated locally, nationally or internationally, engages in public benefit activities and is registered as a PBO by the Public Benefits Organizations Regulatory Authority.

Public benefit activities are listed in the Act to include the promotion of public benefit in legal aid, agriculture, children, culture, disability, energy, education, environment and conservation generally, gender, governance, poverty eradication, health, housing and settlement, human rights, HIV/AIDS, information, informal sector, old age, peacebuilding, population and reproductive health, refugees, disaster prevention, preparedness and mitigation, relief, pastoralism and the marginalized communities, sports, water and sanitation, animal welfare, and youth.

However, for greater certainty, a PBO does not include—

• a trade union within the meaning of the Labour Relations Act, 2007
• a public body established by or under any written law;
• a political party within the meaning of the Political Parties Act, 2007 (Cap. 7B);
• a religious organization which is primarily devoted to religious teaching or worship;
• a society within the meaning of the Societies Act (Cap. 108);
• a co-operative society within the meaning of the Co-operative Societies Act (Cap. 469);
• a Sacco society within the meaning of the Sacco Societies Act (Cap. 490B);
• a micro-finance institution within the meaning of the Micro-Finance Institutions Act, 2006 (No. 19 of 2006);
• a community-based organization whose objective includes the direct benefit of its members.

LEGAL FRAMEWORK

PBOs are regulated by the Public Benefits Organizations Act No. 18 of 2013. The Act provides a scale of what falls within the meaning of a PBO. It further guides the registration requirements and process, including what should be contained in a PBO’s Constitution and by-laws as under section 8 of the Act. The Act establishes the Public Benefit Organizations Regulatory Authority under section 34, which regulates the operations of PBOs in the country. The Act further outlines the government’s responsibility to PBOs, which includes providing an enabling environment for public benefit organizations to be established and operate.[1] In addition, the Act outlines how disputes about any decision by the PBO Regulatory Authority are handled, either by Review by the Authority or by appeal to the Tribunal.[2] Issues on self-regulation, administrative and reporting obligations, and suspension and cancellation of registration certificates are also discussed within the Act.

REGISTRATION OF PUBLIC BENEFIT ORGANISATIONS

The registration of Public benefit organizations in Kenya is primarily governed by the Public Benefit Organizations Act of 2013, which provides a comprehensive legal framework for the registration, regulation, and management of PBOs.

An organization must apply to the PBO Regulatory Authority to be registered as a PBO. The act stipulates that only organizations which meet specific criteria and operate for public benefit can be registered. Section 6 of the PBO Act outlines the criteria for registration, emphasizing that the organization’s objectives must be exclusively for public benefit purposes, which have been outlined earlier. The PBO Regulatory Authority is further tasked with maintaining a register of all PBOs, ensuring compliance with the regulatory requirements.

International PBOs

IPBOs registered outside Kenya can go through either of two processes. These are:

1. Application for a certificate to operate in Kenya; or

Organizations that do not intend to directly implement any activities or programmes in Kenya or operate from Kenya to implement any activities or programmes in another country are exempt from registration. Instead, they must only apply to the Authority for a certificate to operate in Kenya.

However, organizations which intend to either:

• directly implement any activities or programs in Kenya;
• operate from Kenya to implement any activities or programs in another country;
• engage in direct implementation of any activity or program in Kenya;
• operate from Kenya to implement any activities or programs in another country; or
• raise any subscriptions or engage in any other form of raising of funds in Kenya

are required to register as IPBOs. They must have a third of their directors as Kenyan citizens and residents. The organization must also maintain an office in Kenya.

 

Disclaimer

The information provided in this article is for informational purposes only and does not constitute legal advice. Readers should seek legal counsel before engaging in any transactions or activities. Additionally, the content of this article does not establish an advocate-client relationship between any reader and any individuals or entities associated with the publication.