Job Losses Loom as Government Moves to Shut Down 98 Companies
Hundreds of Kenyans could soon find themselves unemployed after the government announced plans to dissolve 98 companies operating in the country.
The announcement was made by the Registrar of Companies, Joyce Koech, in a gazette notice dated Friday, January 31.
According to Koech, the affected companies will be removed from the official register under Section 897(3) of the Companies Act.
This section allows the Registrar of Companies to strike off businesses that have not been actively operating for a certain period.
The notice also invites individuals who may have concerns about the dissolution to present their objections and provide reasons why these companies should not be deregistered.
“As per Section 897 (3) of the Companies Act, the Registrar of Companies hereby notifies the public that the names of the companies listed in the schedule will be removed from the register unless valid reasons are provided to prevent their dissolution,” the notice stated.
Most of the companies targeted for deregistration are privately owned businesses that operate both within Kenya and in international markets.
The affected firms include manufacturers of industrial equipment such as generators, pressure washers, concrete mixers, vibrators, and water pumps.
Additionally, one of the companies slated for closure is a firm established in 2015 that specializes in developing run-of-river hydroelectric power projects in Kenya and other Sub-Saharan African nations.
Several other companies involved in motor vehicle assembly, timber processing, and furniture manufacturing are also on the list.
Real estate firms are also among those facing deregistration. These companies play a key role in buying, selling, and renting properties, as well as negotiating fair deals between property buyers and sellers.
The shutdown of such firms could significantly impact the property market and related businesses.
Companies can be dissolved for various reasons under the Companies Insolvency Rules. A firm may be liquidated if a court issues a winding-up order, meaning it is legally mandated to cease operations.
Another reason for dissolution is failing to submit required statutory reports to the Registrar of Companies.
Furthermore, a business that has been inactive for an extended period can be deregistered. A company can only apply for removal from the register if it has not changed its name or modified the nature of its operations.
The impending closure of these businesses is expected to have a significant economic impact, particularly on employees who depend on them for their livelihoods.
It remains to be seen whether any of the companies will successfully appeal against the dissolution order.
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