Insolvency Act Cap 53 in Kenya

(1) A directors' proposal (with or without modifications) takes effect as a voluntary arrangement by the company on the day after the date on which it is approved by the Court by order made under section 629(7)(a) or on such later date as may be specified in the order. (2) On taking effect, a...

(1) The following persons may make an application to the Court for an order under this section— (a) a person who was entitled to vote at the meeting of the company or the meeting of its creditors; (b) a person who would have been so entitled if the person had had notice of the relevant...

(1) An officer of a company who— (a) makes a false representation for the purpose of obtaining the approval of the members or creditors of a company to a proposal for a voluntary arrangement; or (b) fraudulently does, or omits to do, any act for that purpose, commits an offence and on conviction...

(1) When a proposal takes effect as a voluntary arrangement, the supervisor becomes responsible for implementing the arrangement in the interests of the company and its creditors and monitoring compliance by the company with the terms of the arrangement. (2) If, in relation to a voluntary...

(1) This section applies if— (a) a moratorium under has been obtained for a company under this Division; or (b) the approval of a voluntary arrangement in relation to a company has taken effect under section 630 or 666. (2) If it appears to the supervisor that any past or present officer of the...

For the purposes of this Division, a voluntary arrangement the approval of which has taken effect under section 630(1) ends prematurely if, when it ceases to have effect, it has not been fully implemented in respect of all persons bound by the arrangement because of section 630(2).

(1) In this Part— "agreement" includes an agreement or undertaking effected by contract, deed or any other document intended to have effect in accordance with the law of Kenya or another jurisdiction; "beginning of the moratorium" has the meaning given by section 645(1); "lodgement date" means the...

This Division has effect with respect to— (a) companies eligible for a moratorium; (b) the procedure for obtaining such a moratorium; (c) the effects of such a moratorium; and (d) deleted by Act No. 1 of 2021.

A company is eligible to obtain a moratorium if it— (a) complies with such requirements (if any) as may be prescribed by the insolvency regulations; (b) is not declared to be an ineligible company by another provision of this Part; and (c) is financially distressed.

The following companies are ineligible companies for the purposes of section 638: (a) a company that holds a licence granted under section 5 of the Banking Act (Cap. 488) authorising it to carry on a banking business, a financial business or the business of a mortgage finance company; (b) a company...

(1) The following companies are also ineligible companies for the purpose of section 638— (a) a company that is under administration; (b) a company that is in liquidation; (c) a company in respect of which a voluntary arrangement already has effect; (d) a company in respect of which a...

(1) A company is also an ineligible company for the purposes of section 638 if, on the lodgement date, it is a project company of a project that is a public-private partnership project and includes step-in rights. (2) In subsection (1), "public-private partnership project" means a project— (a) the...

(1) Deleted by Act No. 1 of 2021 (2) If the directors of an eligible company wish to obtain a moratorium, they shall— (a) prepare— (i) a document setting out why a moratorium is desirable, which may include evidence that it will assist in agreeing an informal restructuring or other agreement with...

(1) To obtain a moratorium, the directors of a company shall lodge with the Court— (a) the documents referred to in section 643(2)(a); (b) a statement to the effect that the company is eligible for a moratorium and the basis of that eligibility; (c) a statement from the monitor that the monitor...

(1) A moratorium takes effect when the documents specified in section 644(1) are lodged with the Court. (2) A moratorium ends after thirty days from and including the day on which the moratorium takes effect, unless the moratorium period is extended under section 669. (3) Deleted by Act No. 1 of...

(1) When a moratorium takes effect in respect of a company, the directors of the company shall immediately give notice of that fact to the monitor. (2) If subsection (1) is not complied with, each of the directors who is in default commits an offence and on conviction is liable to a fine not...

(1) As soon as practicable after being notified that a moratorium has taken effect, the monitor shall— (a) publish— (i) once in the Gazette; (ii) once in at least two newspapers circulating in the area in which the company has its principal place of business in Kenya; and (iii) on the company's...

(1) Within fourteen days after a moratorium has come to an end, the monitor shall— (a) publish— (i) once in the Gazette; (ii) once in at least two newspapers circulating in area in which the company has its principal place of business in Kenya; and (iii) on the company's website (if any), a...

(1) While a moratorium has effect in respect of a company— (a) an application for liquidation of the company may not be made; (b) a meeting of the company may be convened or requisitioned— (i) only with the consent of the monitor or with the approval of the Court; and (ii) if the Court gives...

Security given by a company at a time when a moratorium has effect in relation to the company can be enforced only if, at that time, reasonable grounds existed for believing that the security would benefit the company.

(1) Sections 653 to 657 apply to a company in respect of which a moratorium currently has effect. (2) The fact that a company enters into a transaction in contravention of a provision of sections 653 to 657 does not of itself— (a) render the transaction void; or (b) make it unenforceable against...

(1) A company in respect of which a moratorium has effect shall ensure that every invoice, order for goods or services, business letter or order form (whether in hard copy, electronic or any other form) issued by or on behalf of the company, and all the company's websites, specifies— (a) the...

(1) A company in respect of which a moratorium has effect may not obtain credit exceeding twentyfive thousand shillings from a person who has not been informed that a moratorium has effect in respect of the company. (2) The reference to the company obtaining credit includes (but is not limited to)...

(1) Subject to subsection (2), a company in respect of which a moratorium has effect may dispose of any of its property only if— (a) there are reasonable grounds for believing that the disposal will benefit the company; and (b) the disposal is approved by the monitor. (2) Subsection (1) does not...

(1) Subject to subsection (2), a company in respect of which a moratorium has effect may make a payment in respect of a debt or other liability of the company that was in existence before the beginning of the moratorium only if— (a) there are reasonable grounds for believing that the payment will...

(1) This section applies to— (a) property of the company that is subject to a security; and (b) goods that are in the possession of the company under a credit purchase transaction. (2) A company may transfer property to that is subject to a security as if it were not subject to the security, but...

(1) During the moratorium, the monitor is responsible for monitoring the company's activities in order to ascertain whether the company is likely to have sufficient funds available to it during the remainder of the moratorium to enable it to continue to carry on its business. (2) On being requested...

(1) Except with the approval of the Court, a provisional supervisor may withdraw consent to monitor a moratorium only if, during the moratorium— (a) the monitor concludes that the company will not have sufficient funds available to it during the remainder of the moratorium to enable it to continue...

(1) Any creditor, director or member of the company, or any other person affected by a moratorium, who is dissatisfied with an act, omission or decision of the monitor during the moratorium may apply to the Court for an order under subsection (3). (2) An application may be made during the...

(1) If there are reasonable grounds for believing that— (a) as a result of any act, omission or decision of the monitor during the moratorium, the company has sustained loss; and (b) the company does not intend to pursue any claim it may have against that monitor, any creditor of the company may...