We wish to update you that the President of the Republic of Kenya signed into law the Movable Property Security Rights Act, 2017 (the “Act”) on 10 May 2017.
The main objective of the Act is to provide for the use of movable property as collateral for credit facilities, to enhance the ability of individuals and entities to access credit using movable assets and to establish a registry to facilitate the registration of notices relating to security rights in movable assets. The Act describes collateral to mean a movable asset that is subject to a security right or a receivable that is subject to an outright transfer. Movable assets are defined in the Act as tangible or intangible assets where tangible assets mean all types of goods and include motor vehicles, crops, machineries and livestock and intangible assets include receivables, deposit accounts, electronic securities and intellectual property rights.
The Act repeals the Chattels Transfer Act (Cap. 28) and amends several sections of The Agricultural Finance Corporation Act (Cap. 323), The Stamp Duty Act (Cap. 480), The Hire Purchase Act (Cap. 507), The Pawnbrokers Act (Cap. 529), The Business Registration Services Act (Act No. 15 of 2015), The Companies Act, 2015 and The Insolvency Act, 2015.
The Act provides that it shall come into force on such date as the Cabinet Secretary may appoint by notice in the Kenya Gazette.
We shall share a more detailed analysis of the Act upon review. You can read more on the Act here.