On 9 May 2024, the Cabinet Secretary for Interior and National Administration published Legal Notice 78 of 2024 (the “Notice”) which operationalized the Public Benefits Organisation Act, 2013 (the “PBO Act”) with effect from 14 May 2024 (the “Commencement Date”).

The PBO Act repeals and replaces the Non-Governmental Organisations Co-ordination  Act, 1990 and introduces an extensive legal framework for the regulation of Public Benefits Organisations (“PBOs”) in Kenya.

We share below some highlights of the PBO Act:  

1. Transition from NGOs to PBOs

Non-Governmental Organisations (NGOs) will henceforth be known as ‘PBOs’. A 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 such by the Authority.

“Public benefit activities” under the PBO Act include:-

• enhancing or promoting the economic, environmental, social or cultural development;
• protecting the environment; and
• lobbying or advocating on issues of general public interest or the interest or well-being of the general public or a category of individuals or organizations.    

2. Change in Regulator

The regulator of the not-for profit sector changes from the Non-Governmental Organizations Co-ordination Board (“NGO Board”) to the Public Benefit Organizations Regulatory Authority (the “PBO Authority”) which takes over all the functions, rights, powers, liabilities and duties of the NGO Board effective from the Commencement Date. The current members of the NGO Board transition seamlessly into members of the PBO Authority.

The mandate of the PBO Authority includes registration and deregistration of PBOs, receiving and reviewing annual reports and basically overseeing the orderly performance of the not-for-profit sector.

3. To Register or not to Register under the PBO Act

As from the Commencement Date, all registered NGOs are deemed to be registered under the PBO Act but will be required to ‘re-register’ under the PBO Act with one (1) year from the Commencement Date.  Their PBO status will cease to exist if  they do not  apply for registration under the PBO Act within thirty (30) days after a specific notice has been issued to them by the PBO Authority.

NGOs that were exempt from registration under the NGO Act are now required to apply for registration  under the PBO Act within three (3) months from the Commencement Date.

4. New Requirement for International NGOs to have a Kenyan Authorized Agent

International PBOs (IPBOs) will be required to submit particulars of a local authorized agent, (a Kenyan citizen who is resident in Kenya) who will be the IPBO’s duly authorised legal representative for purposes of  receiving official summonses, notices and inquiries on the behalf of the IPBO.

5. Exemption of INGOs from Registration

INGOs may be exempted from registration under the PBO Act and instead granted a permit to operate in Kenya if they do not intend to directly implement activities or programmes in Kenya or operate from Kenya to implement activities or programmes in another country.        

6. Benefits of PBO Status

PBOs will enjoy a wide range of benefits including indirect government support in the form of exemption from specified categories of taxes, direct government financing and preferential treatment in public procurement procedures and bidding for contracts.

7. Establishment of PBO Disputes Tribunal

The Tribunal will determine appeals from members of the public or PBOs against decisions of the PBO Authority and complaints arising out of a breach of the PBO Act.

8. Establishment of the National Federation of Public Benefits Organizations,

The National Federation of Public Benefits Organisations is an umbrella organisation of all registered PBOs and self-regulation forums. Its functions include promoting self regulation, coordinating and monitoring the self regulation forums registered under the PBO Act.  

While the PBO Act is not perfect and would have needed some panel beating before being rolled out, it is a welcome development to regulate an all important not for profit sector which to many Kenyans in the marginalised areas is the only Government they know.  The NGO Act had long outlived it usefulness.