IMPLEMENTATION LEVEL

National

AFFECTED FLOW

Inflow

ANNOUNCED AS TEMPORARY

No

NON-TRADE-RELATED RATIONALE

No

ELIGIBLE FIRMS

all

JUMBO

No

TARIFF PEAK

No
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Inception date: 09 May 2017 | Removal date: open ended
Still in force

Local sourcing

The government of Kenya for the first time imposed the following local content requirements on companies specifically operating in the mining industry:

  • Entities which are registered as existing holders of mineral rights or licences for the first time are required to submit to the Cabinet Secretary for Mining, procurement plans which emphasize the focus of their institutions on the concept of local content. In other words, they are required to submit procurement plans which emphasize the extent to which their respective organizations focus on favouring the procurement of local goods and services. The newly required reports must contain :  
    • A set of institutional target levels of local procurement-related benchmarks. These target levels should be defined on the basis of a procurement list which is to be eventually  developed and communicated by the Directory of Mines of Kenya; 
    • A specific scheme indicating the support that mineral right or license holders are to provide for: a) boosting local providers and suppliers as well as b)  broadening the overall supply of local goods and services.
  • Companies providing engineering services in the mining sector must for the first time be: a) entities primarily of a Kenyan origin and registered with the designated contracting bodies, or 2) foreign engineering consultants working in collaboration with local entities licenced to provide such engineering services in Kenya. The newly imposed requirements emphasize that expatriate or foreign engineering companies can not be directly contracted anymore without the consent of the Cabinet Secretary for Mining and the Engineering Board of Kenya (as according to the new regulations, the contracting of foreign parties without the consent of the designated local authorities is only allowed when foreign parties play the role of consultants collaborating with local engineering entities). In scenarios when there are no qualified local Kenyan entities capable of providing the necessary engineering services, the Cabinet Secretary of Mining alongside other relevant regulatory bodies might permit the direct contracting of foreign/expatriate engineering entities to take place.
  • Reconnaissance, retention and prospecting licence holders will now for the first time be required to have their exploration reports prepared and signed by a  geologist recognized by the Geologists Registration Board of Kenya. 
  • License holders in the Kenyan jurisdiction, as well as contractors and subcontractors, now for the first time are obliged to ensure that their reconnaissance, prospecting and mining businesses and operations are insured with local companies who are licenced by the Insurance Regulatory Authority of Kenya. As according to the new regulation,  insurance can no longer be placed offshore without the written approval of the Insurance Regulatory Authority of Kenya. 

 The denoted local content rules were gazetted on 9 May 2017. 

 

AFFECTED COUNTRIES

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