Cross-border trade and investment have become increasingly common, with Kenyan businesses regularly entering into contracts with companies incorporated outside Kenya.

This often raises an important legal question of whether a foreign company can enforce its contractual rights before Kenyan courts even if it is not registered in Kenya.

While Kenyan law requires certain foreign companies carrying on business in Kenya to register locally, the courts have increasingly recognized that foreign incorporation alone does not prevent a company from seeking justice in Kenyan courts.

Recent judicial decisions have increasingly recognized that a foreign company's legal existence arises upon its incorporation in its home jurisdiction and is not automatically dependent on registration in Kenya.

Where a foreign company intends to carry on business in Kenya on a continuing basis, the law generally requires it to register as a foreign company.

However, registration requirements should be distinguished from the right to institute legal proceedings. Recent judicial decisions have emphasized that failure to register does not automatically deprive a foreign company of the right to enforce its contractual rights, particularly where the dispute arises from a specific transaction connected to Kenya rather than continuous business operations.

In determining whether a foreign company can maintain proceedings in Kenya, the court may consider several factors, including:

Both Kenyan and foreign businesses involved in cross-border transactions should take steps to protect their contractual and commercial interests.

Cross-border transactions can involve complex questions relating to jurisdiction, company registration, contractual obligations, and enforcement. Legal practitioners play an important role by: