Firms to get automatic license approval after 28 days in proposed business law reforms

Investment Promotion Principal Secretary for Abubakar Hassan Abubakar /FILE

A delay in the approval of licenses by county governments for more than 28 days will see businesses cleared to operate, this is under proposed laws seeking to cut trade barriers in counties.

The County Licensing (Uniform Procedures) regulations of 2025 seek to, among others, also collapse multiple county permits into a single licence.

The plan by the Investment, Trade and Industry ministry aims at improving the investment climate and eliminating barriers.

Speaking before the National Assembly Committee on implementation, Principal Secretary for Investment Promotion, Abubakar Hassan Abubakar, said they are finalising the regulations that will harmonise county trade licensing for uniformity, transparency and efficiency.

He said currently, county-based licensing systems are fragmented, lengthy and riddled with duplication, forcing businesses to spend months, or even years, chasing multiple approvals.

“Some companies take up to two years to get a single licence. These licences are not uniform and, in many cases, they are not automatic,” said Abubakar.

The PS told the committee that to address these hurdles, the ministry has developed a plan anchored on five strategic interventions, with licensing reforms at its core.

The proposed changes will collapse multiple county permits into one unified licence, standardise the application process and digitise approvals to speed up turnaround times.

“We are putting in place a system where, if you do not receive a response from the county government within 28 days, your licence is automatically approved. No business should be kept waiting indefinitely,” Abubakar explained.

He added that the Council of Governors has been mandated to harmonise inter-county licensing to ease the movement of goods and services across jurisdictions.

Currently, traders transporting products from one county to another must seek clearance at each stop, a situation the ministry says is both costly and uncompetitive.

“The goal of my department is to increase the level of private investment in the Kenyan economy. For that to happen, both the national and county business environments must be competitive and predictable,” he said.

Beyond licensing, the ministry is developing county industrial policies, investment units and a County Competitiveness Index that assesses the economic strengths and weaknesses of each county.

These measures are intended to guide targeted interventions, spur local industrialisation, and encourage counties to host more investment promotion conferences.

However, the session also exposed simmering tensions between national and county authorities over the control of licensing powers.

Lawmakers led by Kathiani MP Robert Mbui questioned whether the proposed regulations might erode counties’ autonomy in setting business rules.

The committee chairperson, Samuel Chepkonga, cautioned against centralising authority at the national level, arguing that counties should retain the ability to legislate on local licensing issues.

“If every county makes its own licensing rules, businesses will face 47 different regimes that’s not sustainable for a unified market,” noted the PS.

Aboubakar clarified that issues around payment systems and timelines are already addressed in the parent Act and will be complemented by the new regulations establishing the County Licensing Board, which will oversee the implementation process.