Fee Schedule – Collateral Registry

The Business Registration Service (BRS) in Kenya has published its fee schedule for the Collateral Registry, a critical component of the country's secured lending framework. This schedule clarifies the costs associated with registering, amending, and cancelling security interests over movable property, as established under the Movable Property Security Rights Act, 2017. While initial registration, amendments, and cancellations of notices incur no direct fees, a search request for a certificate costs KShs 500. This transparent fee structure, coupled with the online accessibility of the registry, aims to enhance the ease of doing business, promote access to credit for individuals and enterprises, and ensure certainty in secured financing transactions involving movable assets.

The Collateral Registry, established under the Movable Property Security Rights Act, 2017, is central to this framework, enabling the registration of security interests over a wide array of movable assets. The BRS, as the statutory body mandated to oversee this registry, plays a pivotal role in its administration. The formalization of the fee schedule is not merely an administrative update; it is a strategic move to reduce transactional friction, encourage the use of movable assets as collateral, and ultimately bolster economic activity by facilitating easier access to finance, especially for small and medium-sized enterprises (SMEs) that often lack traditional immovable collateral.

The administration of the Collateral Registry falls under the purview of the Business Registration Service (BRS), a State Corporation established under the Business Registration Service Act, 2015 (No. 15 of 2015). The BRS is mandated to oversee various registries, including the Companies Registry, Insolvency Registry, and the Movable Property Security Rights Registry. Its establishment consolidated fragmented registration functions, aiming to improve efficiency and accessibility through digitized systems. The Collateral Registry supports secured lending by allowing interests in assets such as receivables, inventory, equipment, and intellectual property to be recorded on a notice-based system, with registration being crucial for third-party effectiveness and priority determination.

The online nature of the Collateral Registry, accessible via the E-Citizen platform, ensures efficiency, with most services, including the issuance of search certificates and confirmation of registration notices, being processed immediately or within one day. This digital approach enhances transparency and certainty, as priority among competing security interests is determined by the date of registration, adhering to a “first-to-register” rule. This mechanism provides a clear framework for creditors to establish their ranking, which is vital for risk assessment and enforcement. The Act also provides for the Registrar to maintain the integrity of information and outlines procedures for removal and archival, ensuring the reliability of the registry.

Going forward, legal professionals should emphasize the strategic advantages of registering security interests in movable property, particularly the priority afforded by early registration. Continuous monitoring of any further amendments to the fee schedule or the Movable Property Security Rights (General) Regulations, 2017, will be essential to ensure that advice remains current and accurate. The BRS's commitment to an efficient and transparent registry system is a positive development for Kenya's financial sector, and its continued evolution will be keenly watched by all stakeholders.