This document provides a summary of a two-day workshop on emerging trends in commercial and financial law in Kenya. Day one covered topics related to banking law, including presentations on mobile payments and the need for a legal framework. Discussions addressed regulating banks and recent banking law reforms. Day two focused on capital markets, including challenges implementing reforms and international best practices. Other topics were the Companies Bill and defining corporate human rights obligations. Recommendations called for collaborative research between the School of Law and financial sector on emerging issues.
Internship is one of the main modes of clinical legal education where the students get an opportunity to observe and apply the legal provisions to a particular domain. The process of internship continues during their entire stay at law school. The aim of this presentation is to give them a comprehensive handout in this regard.
1. Three Collective Management Organizations (CMOs) - MCSK, PRISC and KAMP - claim the right to collect public performance license fees for sound and audiovisual works played at Prime Chic Holdings restaurants.
2. Prime Chic Holdings seeks clarification on which body is mandated to collect fees, as the CMOs each demand separate payments for the same content.
3. The legal opinion analyzes the Copyright Act and determines that MCSK has been approved by the Copyright Board to collect fees for public performance of musical works in restaurants. PRISC and KAMP/PRISK together issue licenses for sound recordings and audiovisual works, but MCSK alone is entitled to collect
The document summarizes the structure of Kenya's financial sector. It describes the major components as commercial banks, non-bank financial institutions, mortgage companies, forex bureaus, development finance institutions, pension schemes, SACCOs, the insurance sector and stock market. It then discusses the key regulatory bodies that oversee each component, including the Central Bank of Kenya, Insurance Regulatory Authority, Capital Markets Authority, Retirement Benefits Authority, and SACCO Societies Regulatory Authority. The regulators are responsible for licensing, supervision and developing policies to promote efficient operations within their respective sectors.
The document summarizes a summer internship program at the law firm of Sethi Associates, working under advocate Rahul Sethi. The internship's objectives were to develop legal skills like writing, research, and communication, as well as gain experience in drafting documents, attending court hearings, and conducting case law research. Tasks included assisting with drafting agreements and affidavits, attending client meetings, and preparing case files. The internship provided learning opportunities in areas like drafting legal notices and affidavits, developing presentation skills, and participating in debates. The office environment was comfortable and supportive of interns, while also maintaining a strict work ethic. Court visits and case law research were also part of the program. The conclusion states the internship
The document discusses various topics related to human rights including the United Nations Human Rights Council, measures for protecting child rights, objectives and features of the Human Rights Act 1993 in India, constitution of the National Human Rights Commission in India, collective rights, and the scope of public interest litigation with respect to human rights in India. It provides answers to several questions related to these topics with details on international conventions, classifications of rights, duties of state institutions, and the role of courts in protecting human rights.
CTS stands for "Cheque Truncation System". It is a cheque clearing system undertaken by the Reserve Bank of India (RBI) for faster clearing of cheques.
Swasti Chaturvedi completed a 30-day internship with Shaurya Infravision LLP, where she assisted with drafting various legal agreements, notices, and complaints. She accompanied lawyers to court for a cheque dishonourment case and learned about drafting agreements, legal notices, complaints, and replies. Overall, the internship provided valuable exposure to different areas of legal work and agreements.
This document summarizes the Bankers' Book Evidence Act of 1891 in Bangladesh. The act aims to amend laws related to admitting bankers' books as evidence in legal proceedings. It allows certified copies of entries in bankers' books to be admitted as prima facie evidence. It also prevents bank officers from being compelled to produce bank books or appear as witnesses, unless ordered by the court. The act grants courts power to order parties to inspect and copy bank entries, and banks must prepare certified copies of relevant entries. It gives courts discretion over costs related to applying the act.
Internship is one of the main modes of clinical legal education where the students get an opportunity to observe and apply the legal provisions to a particular domain. The process of internship continues during their entire stay at law school. The aim of this presentation is to give them a comprehensive handout in this regard.
1. Three Collective Management Organizations (CMOs) - MCSK, PRISC and KAMP - claim the right to collect public performance license fees for sound and audiovisual works played at Prime Chic Holdings restaurants.
2. Prime Chic Holdings seeks clarification on which body is mandated to collect fees, as the CMOs each demand separate payments for the same content.
3. The legal opinion analyzes the Copyright Act and determines that MCSK has been approved by the Copyright Board to collect fees for public performance of musical works in restaurants. PRISC and KAMP/PRISK together issue licenses for sound recordings and audiovisual works, but MCSK alone is entitled to collect
The document summarizes the structure of Kenya's financial sector. It describes the major components as commercial banks, non-bank financial institutions, mortgage companies, forex bureaus, development finance institutions, pension schemes, SACCOs, the insurance sector and stock market. It then discusses the key regulatory bodies that oversee each component, including the Central Bank of Kenya, Insurance Regulatory Authority, Capital Markets Authority, Retirement Benefits Authority, and SACCO Societies Regulatory Authority. The regulators are responsible for licensing, supervision and developing policies to promote efficient operations within their respective sectors.
The document summarizes a summer internship program at the law firm of Sethi Associates, working under advocate Rahul Sethi. The internship's objectives were to develop legal skills like writing, research, and communication, as well as gain experience in drafting documents, attending court hearings, and conducting case law research. Tasks included assisting with drafting agreements and affidavits, attending client meetings, and preparing case files. The internship provided learning opportunities in areas like drafting legal notices and affidavits, developing presentation skills, and participating in debates. The office environment was comfortable and supportive of interns, while also maintaining a strict work ethic. Court visits and case law research were also part of the program. The conclusion states the internship
The document discusses various topics related to human rights including the United Nations Human Rights Council, measures for protecting child rights, objectives and features of the Human Rights Act 1993 in India, constitution of the National Human Rights Commission in India, collective rights, and the scope of public interest litigation with respect to human rights in India. It provides answers to several questions related to these topics with details on international conventions, classifications of rights, duties of state institutions, and the role of courts in protecting human rights.
CTS stands for "Cheque Truncation System". It is a cheque clearing system undertaken by the Reserve Bank of India (RBI) for faster clearing of cheques.
Swasti Chaturvedi completed a 30-day internship with Shaurya Infravision LLP, where she assisted with drafting various legal agreements, notices, and complaints. She accompanied lawyers to court for a cheque dishonourment case and learned about drafting agreements, legal notices, complaints, and replies. Overall, the internship provided valuable exposure to different areas of legal work and agreements.
This document summarizes the Bankers' Book Evidence Act of 1891 in Bangladesh. The act aims to amend laws related to admitting bankers' books as evidence in legal proceedings. It allows certified copies of entries in bankers' books to be admitted as prima facie evidence. It also prevents bank officers from being compelled to produce bank books or appear as witnesses, unless ordered by the court. The act grants courts power to order parties to inspect and copy bank entries, and banks must prepare certified copies of relevant entries. It gives courts discretion over costs related to applying the act.
This presentation talks about the various aspects of Dishonour of cheque under Negotiable Instrumenmts Act 1881.
The presentation has been prepared as a project work and from basic research and understanding of law.
It must not be taken as any guidance, advise or any advertising on any part.
This is a presentation made on cheques ,It consists of all the information about : what are cheques,its legal definition, its history, the generalized features, the cheque types depending on the situation we use then and all the security features of cheques and the related case study.
This document discusses the legal framework for internet banking. It begins by defining internet banking and its different levels of services. It then outlines key laws and regulations governing electronic funds transfers and internet banking, including contract law, the Banking and Financial Institutions Act 1989, Digital Signatures Act 1997, and Computer Crimes Act 1997. The document also discusses BNM guidelines on consumer protection and the provision of internet banking. It concludes by discussing internet banking from an Islamic perspective and how online Islamic banking can be conducted in accordance with Shariah principles.
The document discusses two major industrial disputes faced by Jet Airways - a 2008 mass firing and reinstatement of 1,900 employees, and a 2009 pilots' strike. In the latter, Jet Airways fired two pilot union leaders, leading 500 pilots to call in sick and go on a 14-day strike that cost the company Rs.15 crore daily. The strike was eventually withdrawn and a grievance committee was formed to resolve disputes and improve coordination between pilots and management.
Attestation under Transfer of Property Act, 1882.
Meaning, example, meaning under section 3 of transfer of property act, Essentials of a valid attestation, Attesting witness, registrar as attesting witness, mode of attestation, legal effect of attestation, party interested in the transaction.
The document discusses habeas corpus under Article 5(2) of the Malaysian constitution. It provides that habeas corpus guarantees the right to challenge unlawful detention in court. The court can order the production of a detained person and quash an illegal arrest or detention. However, habeas corpus does not apply in certain situations, such as when serving a lawful court sentence, lawful arrests for 24 hours, or remand under a magistrate's order. It also does not apply to challenges of trial legality, bail conditions, restriction orders, or detention for deportation under immigration law. The remedy in those cases is appeal through criminal procedure codes instead of habeas corpus.
Classification of cause of action / characterisationcarolineelias239
it is the second element in private international law to decide a case having foreign element, after assuming jurisdiction by a court. It is essential to categorize facts of a case & to find out which part of law to be applied - whether tort / contract/ succession/ marital issues etc. Then only a case can be decided.
The document discusses Lok Adalats, which are permanent and continuous people's courts in India established under the Legal Services Authorities Act of 1987. Lok Adalats aim to provide an alternative dispute resolution mechanism that is faster and more cost-effective compared to regular courts. The document outlines the key provisions relating to Lok Adalats contained in Sections 19-22 of the Act, including how cases can be referred to Lok Adalats, the powers of Lok Adalats, and that their awards have the same status as a civil court decree. The benefits of Lok Adalats are also summarized, such as no court fees and a less formal procedure compared to courts. Finally, the differences between ordinary and permanent Lok Adal
The obligation of a banker to honour his customer’s cheque is extinguished (not accepted or clear) on receipt of an order of the Court, known as the Garnishee order, issued under Order 21, Rule 46 of the Code of Civil Procedure, 1908.
A court order instructing a garnishee (a bank) that funds held on behalf of a debtor (the judgement debtor) should not be released until directed by the court. The order may also instruct the bank to pay a given sum to the judgement creditor (the person to whom a debt is owed by the judgement debtor) from these funds.
If the debtor fails to pay the debt owned by him to his creditor, the latter may apply to the court for the issue of a garnshee order on the banker of his debtor.
The account of the customer with the banker, thus, becomes suspended and the banker is under an obligation not to make any payment thereof.
The creditor at whose request the order is issued is called the judgment creditor; the debtor whose money is frozen is called judgment debtor and the banker who is the debtor of the judgment debtor is called the Garnishee.
The Garnishee order is issued in two parts
The court directs the banker to stop payment out of the account of the judgement-debtor
ORDER NISHI
After the bank file his explanation, if any, the court may issue the final order, called ORDER ABSOLUTE
If you face any problem regarding the research then you can communicate with me and I would appreciate your comments.
E-mail: devendrasrivastava36@gmail.com
divyashreenandini@gmail.com
The development of the Indian banking system can be divided into three phases:
Phase I from 1786 to 1969 saw slow growth and periodic bank failures. Phase II from 1969 to 1991 included nationalization of banks and reforms. Phase III from 1991 onward introduced many new banking products and facilities as part of liberalization reforms. Technological developments like ATMs, internet banking, and real-time payment systems have modernized the system but full implementation remains a work in progress, especially in rural areas, due to infrastructure challenges. Innovation in areas like biometric authentication, mobile payments, and virtual banking promise further advances.
The United Nations Commission on International Trade Law (UNCITRAL) works to modernize and harmonize rules for international business. Comprised of 60 member states, UNCITRAL operates six working groups and aims to unify national trade laws through conventions and other outputs like model laws, guides, and seminars. These efforts help coordinate different legal systems, speed up international trade, increase economic growth, and improve living standards globally.
There are three types of negotiable instruments: promissory notes, bills of exchange, and cheques. A cheque is an unconditional order in writing to a banker to pay a certain sum of money. A cheque can be dishonored for reasons like insufficient funds or a frozen account. Under Section 138 of the Negotiable Instruments Act, a person whose cheque is dishonored can be punished with up to 2 years imprisonment, a fine of twice the cheque amount, or both. The legal process for recovering money from a dishonored cheque involves issuing a notice, filing a criminal case if payment is not made, presenting evidence, and the court issuing a judgment.
This short document discusses nuclear energy and features two stock photos - one of a nuclear power plant and another of a person holding a camera. In a few sentences, it encourages the reader to create their own presentation on SlideShare, suggesting they may find the topic of nuclear energy inspiring.
The document discusses the equitable doctrine of promissory estoppel. It provides that equity will not favor a party who makes a promise to relieve another of their legal obligation but then tries to go back on that promise. The doctrine requires that the promise be clear and unequivocal, that there was a pre-existing legal relationship between the parties, and that the promisee relied on the promise. It also establishes that mere silence or encouragement can give rise to a promise under promissory estoppel. The doctrine is an equitable remedy that can be used as a shield to prevent injustice but not as an independent cause of action.
Private international law (PIL), also known as conflict of laws, deals with legal disputes that involve a foreign element between private parties. It is the branch of domestic law that determines which jurisdictions' laws apply when legal issues cross international borders. PIL establishes rules for choice of jurisdiction, choice of applicable law, and recognition and enforcement of foreign judgments. The key aspects are that PIL is part of a state's domestic legal system but applies when a case contains international factors outside that legal system.
This document provides a summary of the March 2011 issue of "EYe on Africa", a publication by Ernst & Young. It discusses several topics:
- Highlights from the Mining Indaba conference in Cape Town, including discussions on resource nationalism and investment in Africa.
- Winners of the 2010 World Entrepreneur Awards, which recognized African entrepreneurs for the first time. Award categories included Master, Emerging Entrepreneur, and Social Entrepreneur.
- A profile of Dr. Bertie Lubner, who received a Lifetime Achievement award for his work establishing the non-profit MaAfrika Tikkun to support education and community development initiatives.
This document announces a two-day specialized training workshop on Islamic banking and microfinance to be held on April 17-18, 2015 in Nairobi, Kenya. The training is organized by AlHuda Center of Islamic Banking and Economics (CIBE) and aims to build the capacity of Islamic finance professionals. Participants will include those from commercial and Islamic banks, regulators, asset management firms, and students. The training will use lectures, discussions, and presentations to educate participants on topics like Islamic banking products and services. The $595 fee covers materials, meals and a certificate.
This presentation talks about the various aspects of Dishonour of cheque under Negotiable Instrumenmts Act 1881.
The presentation has been prepared as a project work and from basic research and understanding of law.
It must not be taken as any guidance, advise or any advertising on any part.
This is a presentation made on cheques ,It consists of all the information about : what are cheques,its legal definition, its history, the generalized features, the cheque types depending on the situation we use then and all the security features of cheques and the related case study.
This document discusses the legal framework for internet banking. It begins by defining internet banking and its different levels of services. It then outlines key laws and regulations governing electronic funds transfers and internet banking, including contract law, the Banking and Financial Institutions Act 1989, Digital Signatures Act 1997, and Computer Crimes Act 1997. The document also discusses BNM guidelines on consumer protection and the provision of internet banking. It concludes by discussing internet banking from an Islamic perspective and how online Islamic banking can be conducted in accordance with Shariah principles.
The document discusses two major industrial disputes faced by Jet Airways - a 2008 mass firing and reinstatement of 1,900 employees, and a 2009 pilots' strike. In the latter, Jet Airways fired two pilot union leaders, leading 500 pilots to call in sick and go on a 14-day strike that cost the company Rs.15 crore daily. The strike was eventually withdrawn and a grievance committee was formed to resolve disputes and improve coordination between pilots and management.
Attestation under Transfer of Property Act, 1882.
Meaning, example, meaning under section 3 of transfer of property act, Essentials of a valid attestation, Attesting witness, registrar as attesting witness, mode of attestation, legal effect of attestation, party interested in the transaction.
The document discusses habeas corpus under Article 5(2) of the Malaysian constitution. It provides that habeas corpus guarantees the right to challenge unlawful detention in court. The court can order the production of a detained person and quash an illegal arrest or detention. However, habeas corpus does not apply in certain situations, such as when serving a lawful court sentence, lawful arrests for 24 hours, or remand under a magistrate's order. It also does not apply to challenges of trial legality, bail conditions, restriction orders, or detention for deportation under immigration law. The remedy in those cases is appeal through criminal procedure codes instead of habeas corpus.
Classification of cause of action / characterisationcarolineelias239
it is the second element in private international law to decide a case having foreign element, after assuming jurisdiction by a court. It is essential to categorize facts of a case & to find out which part of law to be applied - whether tort / contract/ succession/ marital issues etc. Then only a case can be decided.
The document discusses Lok Adalats, which are permanent and continuous people's courts in India established under the Legal Services Authorities Act of 1987. Lok Adalats aim to provide an alternative dispute resolution mechanism that is faster and more cost-effective compared to regular courts. The document outlines the key provisions relating to Lok Adalats contained in Sections 19-22 of the Act, including how cases can be referred to Lok Adalats, the powers of Lok Adalats, and that their awards have the same status as a civil court decree. The benefits of Lok Adalats are also summarized, such as no court fees and a less formal procedure compared to courts. Finally, the differences between ordinary and permanent Lok Adal
The obligation of a banker to honour his customer’s cheque is extinguished (not accepted or clear) on receipt of an order of the Court, known as the Garnishee order, issued under Order 21, Rule 46 of the Code of Civil Procedure, 1908.
A court order instructing a garnishee (a bank) that funds held on behalf of a debtor (the judgement debtor) should not be released until directed by the court. The order may also instruct the bank to pay a given sum to the judgement creditor (the person to whom a debt is owed by the judgement debtor) from these funds.
If the debtor fails to pay the debt owned by him to his creditor, the latter may apply to the court for the issue of a garnshee order on the banker of his debtor.
The account of the customer with the banker, thus, becomes suspended and the banker is under an obligation not to make any payment thereof.
The creditor at whose request the order is issued is called the judgment creditor; the debtor whose money is frozen is called judgment debtor and the banker who is the debtor of the judgment debtor is called the Garnishee.
The Garnishee order is issued in two parts
The court directs the banker to stop payment out of the account of the judgement-debtor
ORDER NISHI
After the bank file his explanation, if any, the court may issue the final order, called ORDER ABSOLUTE
If you face any problem regarding the research then you can communicate with me and I would appreciate your comments.
E-mail: devendrasrivastava36@gmail.com
divyashreenandini@gmail.com
The development of the Indian banking system can be divided into three phases:
Phase I from 1786 to 1969 saw slow growth and periodic bank failures. Phase II from 1969 to 1991 included nationalization of banks and reforms. Phase III from 1991 onward introduced many new banking products and facilities as part of liberalization reforms. Technological developments like ATMs, internet banking, and real-time payment systems have modernized the system but full implementation remains a work in progress, especially in rural areas, due to infrastructure challenges. Innovation in areas like biometric authentication, mobile payments, and virtual banking promise further advances.
The United Nations Commission on International Trade Law (UNCITRAL) works to modernize and harmonize rules for international business. Comprised of 60 member states, UNCITRAL operates six working groups and aims to unify national trade laws through conventions and other outputs like model laws, guides, and seminars. These efforts help coordinate different legal systems, speed up international trade, increase economic growth, and improve living standards globally.
There are three types of negotiable instruments: promissory notes, bills of exchange, and cheques. A cheque is an unconditional order in writing to a banker to pay a certain sum of money. A cheque can be dishonored for reasons like insufficient funds or a frozen account. Under Section 138 of the Negotiable Instruments Act, a person whose cheque is dishonored can be punished with up to 2 years imprisonment, a fine of twice the cheque amount, or both. The legal process for recovering money from a dishonored cheque involves issuing a notice, filing a criminal case if payment is not made, presenting evidence, and the court issuing a judgment.
This short document discusses nuclear energy and features two stock photos - one of a nuclear power plant and another of a person holding a camera. In a few sentences, it encourages the reader to create their own presentation on SlideShare, suggesting they may find the topic of nuclear energy inspiring.
The document discusses the equitable doctrine of promissory estoppel. It provides that equity will not favor a party who makes a promise to relieve another of their legal obligation but then tries to go back on that promise. The doctrine requires that the promise be clear and unequivocal, that there was a pre-existing legal relationship between the parties, and that the promisee relied on the promise. It also establishes that mere silence or encouragement can give rise to a promise under promissory estoppel. The doctrine is an equitable remedy that can be used as a shield to prevent injustice but not as an independent cause of action.
Private international law (PIL), also known as conflict of laws, deals with legal disputes that involve a foreign element between private parties. It is the branch of domestic law that determines which jurisdictions' laws apply when legal issues cross international borders. PIL establishes rules for choice of jurisdiction, choice of applicable law, and recognition and enforcement of foreign judgments. The key aspects are that PIL is part of a state's domestic legal system but applies when a case contains international factors outside that legal system.
This document provides a summary of the March 2011 issue of "EYe on Africa", a publication by Ernst & Young. It discusses several topics:
- Highlights from the Mining Indaba conference in Cape Town, including discussions on resource nationalism and investment in Africa.
- Winners of the 2010 World Entrepreneur Awards, which recognized African entrepreneurs for the first time. Award categories included Master, Emerging Entrepreneur, and Social Entrepreneur.
- A profile of Dr. Bertie Lubner, who received a Lifetime Achievement award for his work establishing the non-profit MaAfrika Tikkun to support education and community development initiatives.
This document announces a two-day specialized training workshop on Islamic banking and microfinance to be held on April 17-18, 2015 in Nairobi, Kenya. The training is organized by AlHuda Center of Islamic Banking and Economics (CIBE) and aims to build the capacity of Islamic finance professionals. Participants will include those from commercial and Islamic banks, regulators, asset management firms, and students. The training will use lectures, discussions, and presentations to educate participants on topics like Islamic banking products and services. The $595 fee covers materials, meals and a certificate.
For Salient Features of Union Budget 2017 created by Lunawat Team click at - http://lunawat.com/Uploaded_Files/Attachments/F_3558.pdf
Regards
CA Pramod Jain
This document summarizes recent trends in corporate financing in India. It notes that India's macroeconomic indicators have improved, placing the economy and stock markets in a better state. It then discusses trends in the primary and secondary markets over the past year. The primary market saw a 23% increase in total resources mobilized in 2014-15 compared to the prior year. In the secondary market, the BSE Sensex and NSE Nifty indexes increased over the past year. The document then discusses the various sources of corporate financing available, including an increased activity in IPOs as companies seek to raise funds for expansion. SEBI has also taken steps to improve the IPO process and encourage listings of startups and SMEs.
The document discusses road transport and vehicle regulation in India. It provides statistics on India's road network growth and the rapid increase in the number of vehicles. Road transport now accounts for the majority of freight and passenger traffic. However, issues include high logistics costs, road accidents killing over 100,000 people annually, and expected further increases in transport demand straining infrastructure. The proposed Motor Vehicles Amendment Bill 2016 aims to modernize regulations, facilitate online services, strengthen road safety rules including for helmets and oversized vehicles, and develop a national transport policy and vehicle/license databases.
This document discusses tax law in the Philippines. It identifies the primary objective of enacting tax law as raising revenues for government operations. It outlines the steps in the legislative process for creating tax laws, including readings in Congress and reconciliation between the Senate and House. It also explains the sources of tax law, including the Constitution, statutory enactments passed by Congress like the National Internal Revenue Code, administrative rulings and regulations issued by the Bureau of Internal Revenue and Department of Finance, and judicial decisions from the Court of Tax Appeals and Supreme Court. It notes that tax laws are generally interpreted in favor of taxpayers except in specific cases favoring the government.
This document provides an overview of public budgets. It begins by defining what a budget is, including that it is a formal estimate of required resources for a given time period. It then discusses different definitions of budgets provided by various scholars. The document outlines the key components of a budget as public expenditures and public revenues. It also discusses different types of budgets, including operating and development budgets. The document further examines classifications of public expenditures by categories, sectors, general objects, and programs/activities. Finally, it introduces the concept of the canon of public expenditures as rules or principles that governments must follow when incurring expenditures.
A research proposal on the Impacts of Microfinance in KenyaFred Mmbololo
This document outlines a proposed research study on microfinance awareness and impact in Nairobi County, Kenya. The study aims to determine the level of awareness of microfinance services among Nairobi residents and assess the impacts of microfinance on economic and social development. The researcher plans to survey Nairobi residents on their familiarity with local microfinance institutions and perceptions of how microfinance has affected areas like income, assets, education, and empowerment. The results could provide insight for microfinance institutions, government, and academics on the reach of services and viability of continued support for microfinance in Kenya.
1. The document defines different types of companies under the Companies Act 1956 including private companies, public companies, government companies, and foreign companies. It outlines their key characteristics such as minimum members, directors, and restrictions.
2. The formation process of companies is explained beginning with incorporation where important documents like the memorandum of association and articles of association are filed. A certificate of incorporation is then issued.
3. Company meetings such as the statutory meeting, annual general meeting, and extraordinary general meeting are discussed. Provisions around notice, agenda, quorum and minutes are covered for validly conducting company meetings.
The document provides an overview of the Malaysian legal system. It discusses that Malaysia has a dual legal system consisting of civil and sharia law. It also outlines the various sources of law in Malaysia including legislation passed by parliament and state assemblies, customary law, and precedents set by higher courts. The document describes the hierarchy of courts in Malaysia, starting with the Federal Court at the top, followed by the Court of Appeal, High Courts, Session Courts, Magistrate Courts, and Juvenile Courts which handle cases involving minors.
This document provides an overview of key changes between the Companies Act, 1956 and the new Companies Act, 2013. It compares provisions around incorporation, share capital, deposits, charges, management and meetings. Some key changes include stricter due diligence for company incorporation, requirements for independent directors and key managerial personnel, limits on auditor appointments, provisions around related party transactions, and faster processes for mergers and restructuring. The new law aims to improve corporate governance and bring more accountability in company operations.
This document discusses budgets and variance analysis for managing a business. It defines a budget as a financial plan covering income and expenses. Variance analysis is the process of comparing actual budget outcomes to planned figures to identify favorable and unfavorable variances. The document provides examples of calculating variances for income, expenses, and profit budgets and interpreting the variances to understand factors that led to differences from the planned budget.
El documento habla sobre la Web 2.0 y cómo ha permitido que los ciudadanos tengan un papel más activo en la creación y difusión de contenidos en la web a través de redes sociales, blogs y wikis. Gracias a estas herramientas, los ciudadanos ahora publican sus propias opiniones y experiencias online de forma masiva. Aunque esto puede no gustar a algunos políticos, periodistas y empresas, también puede conducir a una mayor transparencia y participación ciudadana.
Final major project evaluation revisitedJack Dixon
Jack Dixon created a music video for his final major project. He filmed scenes at a country park and music festival after his initial footage was poor quality. Editing challenges included syncing footage to the beat and speeding up clips. Feedback was positive from friends who found it funny, showing the intended humor was effective. While the final video differed from his original plan, it still targeted the desired demographic of students interested in house music and festivals. Through this project, Jack improved his skills with Adobe software, camerawork, and independent working.
The document describes the grape harvest activities that a group of children participated in during September 2012. It discusses the steps of the process they were taught, including picking grapes, tasting them, placing them to be stomped, stomping barefoot to make must, making wine, and enjoying the final product. It concludes by mentioning a visit to a winery.
George Sterling was a poet born in 1869 in New York who was sent to a Catholic college in Maryland by his father, though Sterling was more interested in poetry. He was later sent by his father to live with his uncle in Oakland, California, where he found work but also had more freedom to pursue poetry. In San Francisco, Sterling was drawn to the bohemian lifestyle and clubs of artists and writers in the city. He saw bohemianism as requiring devotion to the arts and poverty. Sterling befriended the influential writer Ambrose Bierce and was greatly influenced by his guidance and introduction to classic works. One of Sterling's poems, "The Black Vulture," symbolizes death as a vulture and was
A Construct Validity of Investment Decision in the Banking Sector in Libya (A...IOSR Journals
Investment decision is an important part of strategic decision making. This is because such decision has involves the allocation of money as is known currently over a period of time, in order to make a profit in future and also be subject to different degrees of risk and uncertainty. However, this paper has an objective to validate the measurements of investment decision in the banking sector in Libya. Moreover, this paper provides comprehensive information on the investment decision in Libyan commercial banks, as well as gaining an understanding on the dimensions of customers’ decisions to invest. Structural equation modeling using 2nd order CFA was employed to validate the measurements. The findings confirmed financial ability, perceived usefulness, product and company attributes and knowledge and past experiences as dimensions of investment decision. The present study has a fundamental contribution as a role model for the investment decision measurements in Libya.
ENABLING INCLUSIVE FINTECH IN THE NIGERIAN CAPITAL MARKET: A REGULATORS PERSP...Samuel Olaegbe
The document discusses the SEC's perspective on enabling inclusive fintech in the Nigerian capital market. Some key points:
1) The SEC recognizes fintech as a collaborator rather than competitor and has constituted a committee to develop a fintech roadmap, promote access and transparency, and provide regulatory guidance.
2) The SEC is taking steps like establishing an innovation office and regulatory sandbox to facilitate engagement with fintech firms and test innovations.
3) In regulating fintech, the SEC aims to prevent excessive regulation while protecting investors, identifying risks, understanding implications for the capital market, and ensuring the existing legal framework can accommodate innovations.
4) The SEC has embraced fintech and taken initiatives to ensure the
The application of real estate as loan collateral in nigeria’s banking sectorAlexander Decker
This document discusses the use of real estate as loan collateral in Nigeria's banking sector. It finds that real estate is the most widely used collateral instrument for bank loans in Nigeria. Banks follow due process when applying real estate as collateral, requiring documentation of borrower title and assessing property value. However, documentation and foreclosure problems present obstacles. The role of real estate as collateral is significant in developing countries due to difficulties in using movable assets as collateral. Overall title, nature of title, and property value are key considerations for banks when applying real estate as loan security.
This document provides instructions for using a custom essay writing service based in Australia. It outlines a 5-step process: 1) Create an account with required information. 2) Complete a 10-minute order form providing instructions, sources, and deadline. 3) Review bids from writers and select one. 4) Receive the completed paper and authorize payment if satisfied. 5) Request revisions to ensure satisfaction, with a full refund option for plagiarized work. The service aims to provide original, high-quality content through a bidding system and revision process.
The relationship between regulatory inconsistencies and nigerian banking indu...Alexander Decker
This document summarizes a research study on the relationship between regulatory inconsistencies and the Nigerian banking industry. The study finds that inconsistencies among the Central Bank of Nigeria, Nigeria Deposit Insurance Corporation, and other regulatory bodies have not ensured effective and efficient banking practices in Nigeria. Each new administrative regime introduces new banking regulations that are later abandoned, contributing to bank distress and failure. The document provides background on banking regulation in Nigeria and objectives of bank regulation.
This presentation was shared by Cab Morris of the Illinois Department of Financial & Professional Regulation on the June 5th at the Banking Digital Currencies seminar.
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Emerging trends in banking & financial law (Kenya)
1. A REPORT ON THE EMERGING TRENDS IN
COMMERCIAL AND FINANCIAL LAW
BANKING LAW, CAPITAL MARKETS LAW AND CORPORATE GOVERNANCE
KCB LEADERSHIP CENTRE, KAREN, NAIROBI
9TH
– 10TH
JUNE 2011
Organized by the Financial and Legal Sector Technical Assistance Project of the Ministry of
Finance and hosted by the University of Nairobi, School of Law.
2. 2
TABLE OF CONTENTS
I. Executive Summary…………………………………………………..……...3
1.1 Introduction……………………………………………………..…....3
1.2 Objectives………………………………………………………..……3
1.3 Key Points from the Presentations……………………………..……3
1.3.1 Day 1 Presentations………………………………………3
1.3.2 Day 2 Presentations…………………………………...…5
II. Background……………………………………………………………..…….6
2.1 The Banking Sector……………………………………….…...…6
2.2 The Capital Markets Authority……………………………...….7
2.3 Corporate Governance……………………………………..…....8
III.Report of the Discussions……………………………………………..……..9
3.1 Welcome and Opening Remarks…………………………………....9
3.2 Day 1
3.2.1 M-Payments, E-Payments and the Future……………...9
3.2.2 Need for Legal and Regulatory Framework for M-
Payments and E-Payments……………………………..10
3.2.3 Regulation of Banking Institutions…………………….11
3.2.4 Banking Law Reforms………………………………….11
3.2.5 Recent Amendments to Banking Law………………...12
3.3 Day 2
3.3.1 The Paradox in the Implementation Matrix of Capital
Markets Reforms in Kenya……………………………..13
3.3.2 Effectiveness of the Policy and Legislative Measures
under the Proposed Amendments to the Capital Markets
Legal and Regulatory Framework……………………..14
3.3.3 International Best Practices in the Regulation of Capital
Markets…………………………………………………..15
3.3.4 The Companies Bill 2010: Challenges and Opportunities
for Corporate Governance……………………………...16
3.3.5 Horizontality and the New Bill of Rights: Towards a
Clearer Definition of Parameters of Corporate
Obligations and Complicity for Human Rights
Violations………………………………………………..17
IV. Sector Specific Recommendations…………..…………………………..…18
V. General Recommendations for the School of Law………………...….….19
VI. Conclusion…………………………………………………………..………20
ANNEX I: Workshop Presentations
ANNEX II: Programme
ANNEX III: List of Participants
3. 3
1.0 EXECUTIVE SUMMARY
1.1 Introduction
The two-day workshop on Banking Law, Capital Markets Law and Corporate
Governance, dubbed the Emerging Trends in Commercial and Financial Law
was organized by the Financial and Legal Sector Technical Assistance Project of
the Ministry of Finance and hosted by the University of Nairobi, School of Law.
The conference drew a wide array of participants from the public, private, and
business sectors. In all, 10 presentations were made, and discussion sessions were
held at the workshop.
The first day of the workshop witnessed the opening ceremony with addresses by
Dr. Kiarie Mwaura from the University of Nairobi and Christine A. Agimba,
Project Manager from the Office of the Deputy Prime Minister and Ministry of
Finance. Laila Abdullatif, Pupil at Okoth & Kiplagat Advocates was the
rapporteur chosen for the workshop.
1.2 Objectives
The objectives of the workshop were:
a. To provide an interactive forum to engage in the discourse on emerging
trends in commercial and financial law in Kenya and elsewhere;
b. To facilitate a better understanding of policy and legal problems that were
to be identified during the discussions;
c. To create links between the School of Law and industry (particularly those
working in the area of commercial law) so as to develop an environment
for exchange of ideas and staff between academia and industry as well as
to explore the possibility of student attachments;
d. To explore the possibility of undertaking collaborative research and
teaching between the School of Law and industry players;
e. To enhance the quality of the curriculum on offer in the fields of
commercial and financial law and to develop standard teaching
materials/course packs in the areas of:
i. Banking Law;
ii. Capital Markets and Securities Regulation; and
iii. Corporate Governance.
1.3 Key Points from the Discussions
1.3.1 Day 1 Presentations
After the opening session, five presentations were made on the first day. The first
two presentations were on M-Payments, E-Payments and the Future, and on the Need
for Legal and Regulatory Framework for M-Payments and E-Payments. These
presentations addressed the emerging trends in Banking Law and called for
collaborative research into these trends by both the School of Law and the
4. 4
Banking Sector.
The first presentation by Stephen Mwaura, Head, National Payment System,
Central Bank of Kenya, on the topic M-Payments, E-Payments and the Future noted
that the growth of mobile telephony in Kenya in recent years has been
phenomenal but marred by inefficiency. He recognized that the banking sector in
the country has attracted the use of technology; his premise derived from the fact
that there has been an increase in the usage of the ATMs and in use of the
MPESA system to transfer money. Accordingly, his concern was on the issue of
cyber crime, an area that has not been addressed by the law.
Presenting the second paper titled the Need for Legal and Regulatory Framework for
M-Payments and E-Payments, Gladys Musuva, Lecturer at the Kenya School of
Monetary Studies, noted that the purpose of a legal and regulatory framework for
M-Payments and E-Payments is for safeguarding money, and to protect
individuals. She stressed that mobile telephony has offered its subscribers with an
opportunity to buy any product anywhere with the only requirement being the
production of the Identification Card. The challenge therefore, she stressed, is the
possibility of fraud in this area.
The next three presentations addressed the legal problems faced by the Banking
sector.
Dr. David Gachuki from the University of Nairobi made a presentation on the
Regulation of Banking Institutions. He noted that the Banking Act states that the
Central Bank of Kenya has the ability to regulate the banking sector but it lacks
the capacity to do so. This is because the Central Bank does not have the
adequate human resource to do so. He also stated that the Central Bank of Kenya
does not regulate the area of the contracts entered into; and the interest that is
charged, by the banks. Concerning the Credit Reference Bureaus, Dr. Gachuki
stated that their sole purpose is regulating the customers and not the banks.
He also cited the relevant sections of the Banking Act, Chapter 488 of the Laws of
Kenya, which guaranteed the success of the Kenyan Banking Sector. He
emphasized that the First Schedule to the Banking Act on the Criteria for
Determining Professional and Moral Suitability of Directors and Senior Officers
Proposed to Manage or Control Institutions is critical. He also underlined the
principle of know your customer saying that the Basel Code of Conduct and Anti
Money Laundering laws forces banks to know their customer. Accordingly, the
principle of know your customer, according to him must be put in the Banking
Act, and that this principle must become law.
Dr. Winnie Kamau from the Kenya School of Law took the participants through
the Banking Law Reforms. She spoke on the role of the Central Bank of Kenya and
enumerated on the reasons for reform in the banking and financial sector.
According to Dr. Winnie Kamau, the challenge is coming up with regulations for
Mobile and Electronic Banking, as well as addressing the concept of Islamic
Banking that is becoming popular.
5. 5
The last presentation of the day titled Recent Amendments to Banking Law was by
Kyalo Mbobu from the University of Nairobi. He began by posing the following
question:
“Do you change the law by changing a rule or regulation?”
Rules and regulations are subordinate to the main Act and therefore not effective
to making change stated Mr. Mbobu. He then empathically demonstrated to the
panel how the Kenyan Banks have refused to be regulated. He also showed how
the Central Bank has been dormant in carrying out its duties.
1.3.2 Day 2 Presentations
Five presentations were made on the second day of the workshop. These
presentations brought out the legal problems that the participants identified
within the commercial and financial sector.
The morning session had the theme: The Paradox in the Implementation Matrix of
Capital Markets Reforms in Kenya. Mr. Njambara Gichuki from the University of
Nairobi explained to the panel the reforms that have been brought into the
Capital Markets system and he also analyzed whether the intended reforms have
achieved the intended result.
However, the panel discussion drew attention to the fact that most of the reforms
have been on developing a regulatory market rather than the development of the
market itself, that there has been an emphasis on regulation and not on the
development of the market.
The second presentation of the morning session by Mr. George Oraro, Senior
Partner at Oraro & Company Advocates on the Effectiveness of the Policy and
Legislative Measures under the Proposed Amendments to the Capital Markets Legal and
Regulatory Framework recognized that SMEs (Small and Medium Sized
Enterprises) face unique challenges, which affect their growth and profitability
and hence, diminish their ability to contribute effectively to sustainable
development. Mr. Oraro then briefly discussed the following challenges: Lack of
Managerial Training and Experience, Inadequate Education and Skills, Lack of
Credit, National Policy and Regulatory Environment, Technological Change,
Poor Infrastructure and Scanty Markets information.
Accordingly, he suggested that SMEs should be attracted into the market by the
establishment of more venture funds to facilitate the SMEs working capital.
Dr. Jacob Gakeri from the University of Nairobi through his paper International
Best Practices in the Regulation of Capital Markets discussed globalization in the
context of the securities market. He gave three reasons for the regulation of the
securities market. These are: to protect investors, to reduce risks and to bring in
confidence in the markets. He emphasized that the market is not regulated and
therefore, suggested an approach by which the market can be regulated. This
approach is based on dealing with the tension between capital formation and
investor protection. According to him African markets are small and struggling,
therefore there is a need to have a regional stock exchange.
6. 6
During the panel discussion it was agreed that security markets are considered
elitist. This is from history where Africans were restricted from trading and
economics. Education, therefore, is essential because financial illiteracy is the
rule. Public education must be sustained. It was also noted that Kenya does not
have a clear policy on financial services and her legal infrastructure is being
reformed now.
It was further agreed that the Capital Markets Authority lacks autonomy.
The afternoon session of the second day of the workshop saw the presentation of
two papers. The themes for the session were: The Companies Bill 2010: Challenges
and Opportunities for Corporate Governance and Horizontality and the New Bill of
Rights: Towards a Clearer Definition of Parameters of Corporate Obligations and
Complicity for Human Rights Violations.
Presentations were made by Lewis Kamau, CEO, Institute of Directors and Dr.
Kiarie Mwaura, University of Nairobi.
The session was dominated by discussions on the Companies Bill on corporate
governance. Mr. Lewis Kamau argued that the role of the Board in corporate
governance is extremely crucial and he looked at how it has been addressed in the
Companies Bill. He identified the following legal issues that plague Kenya’s
corporate sector: Poor selection criteria for appointing directors; Lack of
independence among directors; and Poor succession planning.
The last panel discussion of the workshop was on the presentation by Dr.
Mwaura on Horizontality and the New Bill of Rights: Towards a Clearer Definition of
Parameters of Corporate Obligations and Complicity for Human Rights Violations.
It was said that governance of corporations is as important as governing nations
and hence there is a need to extend International Human Rights to corporations.
Dr. Mwaura concluded by stating that Kenya does not have a proper framework
to control businesses and that is a challenge to the country.
2.0 BACKGROUND
2.1 The Banking Sector
The Companies Act, the Banking Act, the Central Bank of Kenya Act and the
various prudential guidelines issued by the Central Bank of Kenya (CBK),
governs the Banking industry in Kenya.
The banking sector was liberalized in 1995 and exchange controls lifted.
The CBK, which falls under the Minister for Finance docket, is responsible for
formulating and implementing monetary policy and fostering the liquidity,
solvency and proper functioning of the financial system.
7. 7
As at December 2008 there were forty-six banking and non-bank institutions,
fifteen micro finance institutions and one hundred and nine foreign exchange
bureaus.
The banks have come together under the Kenya Bankers Association (KBA),
which serves as a lobby for the banking sector’s interests. The KBA serves a
forum to address issues affecting members.
Players in this sector have experienced increased competition over the last few
years resulting from increased innovations in the market, specifically from the
emergence of M-Payments and E-Payments.
2.2 The Capital Markets Authority
The Capital Markets Authority (CMA) was established in 1989 as a body
corporate with perpetual succession through an Act of Parliament to regulate and
oversee the orderly development of Kenya’s capital markets. The mission of the
Capital Markets Authority is to promote the development of orderly, fair,
efficient, secure, transparent and dynamic capital markets in Kenya within a
framework which facilitates innovation through an effective but flexible system of
regulation for the maintenance of investor confidence.
Pursuant to its mission, the CMA is guided by the following objectives:
a) Facilitate the creation of incentives for and the removal of impediments to
long-term investments in productive activities.
b) Facilitate the existence of a market in which securities can be traded in an
orderly, fair and efficient manner, and ensure participation of the general
public.
c) Protect investors from financial loss arising from failure of a broker or
dealer to meet his contractual obligations through a guarantee embodied
in the compensation fund.
d) Develop a framework through which electronic commerce may be used for
the development of capital markets in Kenya.
e) Develop new financial products to diversify the market and attract
investors.
f) Facilitating the training and education of investors and other market
participants.
g) Participate in the integration of the East African capital market.
h) Develop a legal and regulatory framework for the market. In this regard,
the CMA has formulated the following rules and regulations:
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a. Capital Markets (Licensing Requirements) (General) Regulations,
2002
b. Capital Markets (Securities) (Public Offers, Listing and Disclosure)
Regulations, 2002
c. Capital Markets (Takeovers and Mergers) Regulations
d. Capital Markets Authority, Foreign Investor Regulations, 2002
e. Capital Markets Authority Fees Structure
f. Collective Investment Schemes Regulations, 2001
g. Corporate Governance Guidelines, 2002
h. Rating Agency Guidelines, 2001
2.3 Corporate Governance
Section 11 (3) and 12 of the Capital Markets Authority Act empower the Capital
Markets Authority to make rules and regulations to govern capital markets in
Kenya. Pursuant to this authority, the Capital Markets Authority developed
guidelines on corporate governance practices by public companies in Kenya, in
2002 and incorporated them as a schedule in the Capital Markets Act.
The guidelines were developed in recognition of the role of good governance in
corporate performance, capital formation, maximization of shareholders value
and protection of investor’s rights.
The main objective of these rules is to strengthen corporate governance practices
in public listed companies in Kenya and to promote the standards of self-
regulation so as to bring the level of governance in line with international
standards.
The Authority has defined corporate governance as the process and structure used
to direct and manage business affairs of the company towards enhancing
prosperity and corporate accounting with the ultimate objective of realizing
shareholders long-term value taking into account the interests of other
stakeholders.
The Authority has also identified a number of principles as essential and critical
foundations for good corporate governance practices. These are the minimum
standards that public listed companies are expected to adhere to and they relate to
directors, shareholders, auditors, public disclosure, chairman and chief
executives.
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3.0 REPORT ON THE DISCUSSIONS
3.1 Welcome and Opening Remarks
Dr. Kiarie Mwaura opened the workshop by welcoming the participants and
asking them to introduce themselves. He also warmly thanked Christine A.
Agimba for providing the opportunity and support to engage in discourse on the
emerging trends in commercial and financial law.
Christine A. Agimba outlined the objectives of the workshop and called for a
strong partnership between the School of Law and the commercial and financial
sector to help make the recommendations following the presentations work.
3.2 Day 1
3.2.1 M-Payments, E-Payments and the Future
The Internet has elements of common standard; it makes us all belong to one
platform and allows its users to connect easily through their phones and PCs. In
1977 there were 111 hosts whereas today 80% of the worlds population are
Internet users. Africa alone accounts for over 110.9 million Internet users, and in
Kenya 25% of the population has access to the Internet.
The Internet has made E-Commerce possible. E-Commerce makes everything
accessible to us. It allows price comparison from different countries.
The Internet is attracting a lot of research, and it simplifies marketing as well.
The Republic of South Africa has a 60% access to finance; Namibia 45% whereas
Kenya has a 23% access to finance. Banking has been with us for over 100 years
then why is Kenya at 23%?
The answer lies in the challenges Kenya faces. These challenges are posed by the
inefficiency in the infrastructure, transport, telecommunication, and power
sectors. Shortages in fuel and food are also challenges that Kenya faces. However,
despite the difficult terrain, illiteracy, and poverty, mobile technology has been
adopted very fast in Kenya and Africa as well. Consequently, there is a need to
look for solutions for the problems faced as a result of this technology.
The areas of concern are the element of storing money in a phone. 90% of
Kenyans believe that their money is safe with MPESA. Mobile subscribers as at
2010 stand at 25million, thus over 60% of the Kenyan population has access to
mobile phones. This in turn has resulted in the growth of MPESA; a system that
needs to be regulated in order to curb the possibility of fraud. Accordingly, mobile
banking and cyber crime as well are aspects of the law, which have not been
addressed.
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3.2.2 Need for Legal and Regulatory Framework for M-
payments and E-payments
There is a need for a regulatory framework for M-payments and E-payments, and
there is also a need to look into the role played by the regulatory bodies.
The issues to be considered under the legal framework are Debit cards, Credit
cards, Smart cards, SWITCH, Truncation, and RTGS whose subscribers are
offered with an opportunity to buy any product anywhere.
M-payments only require the Identification Card number. The challenge,
therefore, is on the possibility of fraud in this area. Thus arises the need to protect
Kenyans from unscrupulous people. Consequently, Banks carry out references for
the purpose of vetting applicants before employing them. Is the same procedure
also a requirement when it comes to employing agents in M-Payments?
M-Payments i.e., Mobile Payments is all about reaching out to the unbanked.
Accordingly, we need to think about protecting the unbanked especially when it
comes to withdrawal of MPESA money. The issue of information privacy is
critical to prevent fraud.
The major users of this system are the rural people and the unbanked. M-
Payments offer a wealth of opportunities to retailers and financiers. Despite this
advantage there are a number of challenges to M-Payments as well as E-
Payments.
These challenges are in the subletting of agencies and the difficulty of tracing
fraudsters.
The issues that need to be considered in the development of a legal framework to
combat these challenges are as follows:
a. Efficiency: we need to pass information to the subscribers and avail access
to it. This is a permanent objective.
b. Consumer confidence: in withdrawal of money and confirmation on
receipt.
c. Efficient payment methods and instruments.
d. Coming up with policy issues for Central Bank in retail payments: for
example the BASEL prudential guidelines.
e. Security is a condition: there would not be any trust in this system without
security. Insecurity needs to be reduced.
f. The issue of terrorism financing through the M-Payments: how much you
can store and withdraw at any given time should be addressed.
g. Competition: access to market and level playing field is critical.
h. Customer protection at a high level: Article 151 of the European Treaty to
be considered.
i. What to do when it comes to unauthorized payments and fraud. This is
where we think about how to protect the unbanked.
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3.2.3 Regulation of Banking Institutions
Section 3 of the Banking Act, Chapter 488 of the Laws of Kenya shows that
Banks are regulated by way of licensing. Regulation is important and the Central
Bank needs to come in to regulate the area of bank contracts and the interest that
is charged by the Banks.
Auditing is also another way of regulating Banks. The Central Bank can appoint
a qualified auditor where it feels that a Bank is not proceeding in the right way.
Through auditing and giving directions to the Banks, the Central Bank can
regulate the Banks.
Regulation also concerns the opening and closing of the Bank’s branch. The
Central Bank thinks that the closing down of a Bank’s branch may not affect the
customers. This presumption is not well founded. Opening of a Bank branch
requires the approval of the Central Bank, whereas closing down the Bank’s
branch requires only a 6-month notice.
Furthermore there is also a need for regulation in the area of amalgamation and
the transfer of a Bank’s assets to another Bank in order to prevent the theft of
money.
There is also a need to restrict the trading done by Banks. All banks today are
multifunctional. The Banking Act does not take into account multifunctional
banking. Banks operate as trustees, and as agents over property, and that has not
been contemplated in the Banking Act.
It is not only through the law that Banks can be regulated. Economic policies can
also be used as a way of regulation. Policy therefore can be a source of regulation.
3.2.4 Banking Law Reforms
The emerging issues of money laundering and terrorist financing have called for
the need to regulate Banks.
The Central Bank of Kenya was established in 1966 and in 1984 there was a
Banking crisis. As a result, the Banking Act was amended to provide for the
Deposit Protection Fund, the question then is whether the amount provided per
depositor is adequate or not [Kshs.100, 000 per depositor].
The factors that drove reform were based on the Banks:
a. Financial indiscipline;
b. Lending without security;
c. Need to respond to the rise of technology; and
d. The need to counter money laundering.
The initiatives that were taken were as follows:
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a. Coming up with Prudential Regulations (concerning the supervision of
banks, risk management, and to ensure security of depositors funds, in line
with Basel 1.)
b. Amendments to the Banking Act to take into account the provisions of
Basel 1.
c. Micro Finance Act and Regulations were passed. Object being to regulate
the establishment of Micro Finance institutions and making them efficient.
d. Introduction of Agency Banking by way of the 2009 amendment to the
Banking Act to include the word “agent”.
e. Establishment of Credit Reference Institutions that collect personal
financial information on customers for credit history-information sharing.
The goal being to reduce fraud.
In conclusion the challenges that now remain are in the grey area concerning:
a. Bank insurance. This is not allowed but Banks indirectly practice it.
b. Lack of regulations concerning mobile and electronic banking.
c. Islamic Banks not having been addressed by the Banking Act.
3.2.5 Recent Amendments to Banking Law
When the Donde Act was introduced for the purpose of regulating the Banks, the
Banks refused to accept the provisions of the Act. No Bank accepted it and
neither did any bank comply with it yet Central Bank as the regulator was there!
Thus it can be said that the Central Bank has been dormant. It has not being
doing its work.
In 2004 the Donde Act was repealed.
The main concern with the Banking sector is that Banks are using their discretion
to change the rate of interest on grounds that the customs and practices of the
Banks allow them that latitude. Judges follow this argument. Section 39 of the
Banking Act stipulates that a ministerial approval is required for the purpose of
increasing the rate of interest. When Daima Bank breached this provision the
Courts remained mum.
In fact no bank has ever applied for permission to apply for an increment.
Parliament has established a regulator and the regulator is not following the
written law. This gave rise to a debate that led the Minister to publish guidelines
for the Banks on how to apply for the ministerial consent to raise bank charges.
Practice has shown that Banks avoid the statute. The Duplum Rule requires that
Banks inform the borrower that the loan is non performing and then to state what
the principal amount is and the interest as well and to give the borrower time to
pay. Failure of which the Banks right to foreclosure arises.
Banks in practice do not follow the Duplum Rule.
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Thus the Banking Industry needs to be controlled. Central Bank’s supervision is
very weak. The Bank needs to be intrusive even though the other banks do not
like it. For the well being of the borrowing public the Central Bank needs to
supervise the banking industry. The Duplum Rule must be enforced and obeyed.
3.3 Day 2
3.3.1 The Paradox in the Implementation Matrix of Capital
Markets Reforms in Kenya
The Vision 2030 on capital markets recognizes the importance of financial
development, the promotion of long-term investments, and the listing of more
companies at the Nairobi Stock Exchange [NSE].
The Capital Markets Authority [CMA] is the main regulatory body in the
financial sector and its principle objective is set out under Section 11 (1) of the
Capital Markets Act, Chapter 485A of the Laws of Kenya.
Our main objective should be to let the markets self regulate, as we focus on the
protection of investors through the Investor Protection Fund. However, our
reforms are not helping us achieve this objective. Our capital market is urban.
The CMA has limited capacity and its supervision of the markets therefore
remains weak. The Authority was only established to regulate the NSE and that
is a wrong intention. The intention should be focused on the development of the
market.
Our reforms have been concentrated on developing a regulatory market rather
than on the development of the markets. We need to promote integrity and
confidence in the markets and that is where our reforms should be centered on.
Between 1954 and 1990 markets developed without regulation therefore we can
say that it is not regulation that brings development in the markets. Conversely in
1990 four stockbrokers collapsed under the watch of the CMA.
Section 18 of the Capital Markets Act establishes the Investor Compensation
Fund [ICF]. The ICF does not have officers, it’s Board is non functional and this
has an impact on investor confidence and on investment itself.
In 2010 the ICF had Kshs 424 million in its fund and it paid out Kshs
281,880,000 in compensation to Nyaga Stock Brokers. The ICF paid more than
half of what it was holding. What would have happened if there were more
investors who were to be compensated?
There is a need to develop the capital market, to educate people, to come up with
concerted efforts to move towards self-regulation by the markets to a practical
extent.
There is a need to make the ICF autonomous. Kshs 50,000 is the amount paid
out for investor compensation, this should be increased and the investors need to
be educated.
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We do not need another Stock Exchange. SMEs are ignored completely. Our
markets are small and if we establish a market in Mombasa it will be trading
once. We do not have the capacity. Our capital market is connected to our
economy. If the economy is not growing, neither will the markets. Instead of
focusing on regulation, we need to focus on developing our markets.
Self-regulation was the result of the collapse of the four stockbrokers. Self-
regulation has failed across the board. We have to share responsibilities. Our
argument should be on how to the share responsibilities. Self-regulation is not
sustainable. The NSE cannot police itself; it will not be serious in regulation since
regulation will impact negatively on its operation. We need to protect consumers
and self-regulation is not the way.
Investor education is an excellent way forward.
The ICF Board has the power to manage the money. Yet the ICF is only seen as
a pay shop. Apart from compensating what else does it do? It does not have
money-raising powers. Reform should take this into account.
It has been noted that Kenya does not have a culture of saving. Savings must be
encouraged [for example the Smart Youth program]. This awareness must be
created, and only then will we have more people participating in the market. We
cannot talk of regulation when there is no participation in the market. Consumer
confidence must be brought into the market. People must know of their rights and
the rights of shareholders so that they understand investment and promote its
growth.
The legal structure to take care of the minority in our corporate structure is dead.
Shareholders rights are practically non-existent.
Therefore self-regulation is doubtful. The Banking Code itself is not about
regulation it is about defending the banks, and how to fight with the customers.
3.3.2 Effectiveness of the Policy and Legislative Measures
under the Proposed Amendments to the Capital Markets
Legal and Regulatory Framework
The capital market is part of the financial system that provides funds for long-
term development. This is a market that brings together lenders (investors) of
capital and borrowers (companies that sell securities to the public) of capital.
In January 2004, the Financial Sector Reform and Strengthening (FIRST)
Initiative launched a “Strategy for Development Finance and Increasing Access to
Financial Services” project for Kenya, which was completed in February 2005. The
aim of the project was to strengthen the financial sector in Kenya by reforming
the Development Finance Institutions, and facilitating access to finance for rural
and small-and-medium enterprise sectors.
In October 2004, the World Bank approved the Proposed Credit to Kenya for the
Financial and Legal Sector Technical Assistance Project. According to the World
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Bank website, the overall objective of the program was to “create a sound
financial system and strengthen the legal framework and judicial capacity.” One
of the main components of the Project included the development of long-term
securities and capital markets in Kenya.
The World Bank has stressed that the Capital Markets Authority has limited
capacity and lacks operational independence, and that its enforcement of market
rules and supervision of market participants is relatively weak.
Kenya’s capital market is still at a nascent stage. The NSE, a self-regulatory
organization under the supervision of the CMA, is the sole licensed trading
exchange in the country. All applications for listing must be approved by the
CMA, and are subject to NSE Rules and Regulations. The NSE is divided into
three parts. The Main Investment Market is the dominant segment and favorable
for “mature companies with strong dividend streams”. The Alternative
Investment Market is favorable for small and medium sized enterprises. The
Fixed Income Securities Market “allows businesses, financial institutions, and
governments and supranational authorities to raise capital through the issuance of
debt securities”.
There are two major Acts of Parliament governing Kenya’s capital market. The
Capital Markets Act and the Central Depositories Act, 2000.
Reform has been proposed by way of amendments to the Capital Markets
(Licensing Requirements) (General) Regulations, 2002. These amendments are
necessary to implement a demutualized stock exchange following the move
towards demutualization which commenced with the amendment to the Capital
Markets Act in the 2010 Finance Bill which converted the requirements for
licensing a stock exchange from a company limited by guarantee to a company
limited by shares.
There has also been a proposed amendment on private transfers. Consequently,
private transactions will be made easier.
However there is a need to license market participants and control the persons
applying for license. We also need to do away with the public and private
dichotomy when it comes to listing at the stock exchange. We need to come up
with reasonable thresholds for a company to go public. This way we can increase
listings. This public-private dichotomy has worked against us. CMA and NSE
are not proactive. They do not look for customers. They should inform Private
companies of the benefit of listing. Kenya has listed in Tanzania and Uganda,
why are serious Ugandan and Tanzanian companies not coming here. We need
to encourage and entice those companies to come here.
3.3.3 International Best Practices in the Regulation of Capital
Markets
What is international about the securities markets? Capital markets are becoming
globalised through increased dealings in securities in different jurisdictions and
the explosion of technological advances.
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We do not have much on international capital market regulation. We only have
principles that countries are encouraged to adopt. It is a soft law approach and it
is voluntary, and these are the International Best Practices. We cannot have an
international securities regulation based on soft law. Regulations can only be
implemented through national law.
A capital market is not a physical building. It is all about the market participants,
investors, shares and the stock exchange. Security exchange is the component of
the capital market.
There are three main reasons for securities regulation. These are to protect
investors, reduce risks and bring in confidence in the market.
In regulating the market we need to deal with the tension between capital
formation and investor protection. We also need to consider Government
protection and regulation.
The consideration when it comes to regulation is on what approach to take. Is
regulation to be by way of enforcement or by rule making? That is the question.
Rule making impacts the market. If the regulator enforces the law harshly
investors will not come into that market. Whereas having a loose regulatory
structure will force companies to list in other jurisdictions in order to get more
credibility, and protection mechanisms.
In Kenya we have an institutional approach towards our sectors. We have the
CMA for the financial sector. The institutional approach encourages the
development of expertise in that area. Our industries are young and we need to
develop the expertise and this approach encouraging.
Self-regulation must be responsive to the needs of the market. Unless it does this,
it is not useful. Self-regulation must be seen in the context of state regulation.
Financial illiteracy is the rule here in Kenya therefore public education must be
sustained. There is no clear policy on financial services. Our legal infrastructure is
being reformed now. CMA lacks autonomy. Stockbrokers are persuasive. There
is no clear policy on the enforcement philosophy of CMA. Some of these
problems will be cured by time.
3.3.4 The Companies Bill 2010: Challenges and Opportunities
for Corporate Governance
Corporate governance is about conducting businesses in a way to ensure fairness.
Due to misconduct and failure of oversight on the part of directors, companies
such Kenya Bus Services, Trust Bank, AT & H, Muhoroni Sugar, United
Insurance have failed.
The areas that are rife for reform is between managers and shareholders. It has
been noted that the controlling shareholders oppress the minority, there is skewed
17. 17
access to information, and managers are likely to exploit shareholders wealth and
we lack just courts that can be trusted to arbitrate. Fair treatment of all parties in
the corporate is essential.
This fairness is part and parcel of the way the Board of Directors carries out its
responsibilities. The role of the Board is central in corporate governance.
When it comes to regulation, other than the Companies Bill there is also the
Corporate Governance Code for Listed Companies in Kenya (2002) that provides
a guidance material on best practice, equitable treatment of shareholders,
transparency and disclosure of information, clarification of the responsibility of
the Board.
According to Price WaterHouse Coopers the way we select our directors is very
poor, there is lack of independence among the directors, there is little controversy
in boardrooms, and rarely are issues raised, there is poor succession planning,
and conflict of interests are rampant.
What has been identified as a weakness in our Company Law is in how to
appoint directors.
The way a company structures its Board of directors is significant to the quality of
governance. There should be representation for the minority shareholders so that
there would be confidence in the organization.
3.3.5 Horizontality and the New Bill of Rights: Towards a
Clearer Definition of Parameters of Corporate
Obligations and Complicity for Human Rights Violations
Governance of corporations is as important as governing nations. Hence there is
the need to extend International Human Rights to corporations.
Article 20 (1) of the Kenyan Constitution states that the Bill of Rights applies to
all laws and binds all State organs and all persons. The article does not define a
person. The interpretation section of the Constitution defines a person as to
include a company. Thus the banks today can be regulated by the new
Constitution under the Chapter on the Bill of Rights.
The concern therefore is whether or not the Constitution should be used to
regulate private persons.
Scholars say that the Constitutions were not made for private persons but for the
regulation of governments and that regulating private persons through the
Constitution will lead to a floodgate of cases and then the courts will not be able
to apply the Constitution to the government.
We do not have a proper framework to control businesses and that is a challenge
to us and for us. Especially where we have direct and indirect violations of
human rights by companies. These parameters need to be drawn clearly. An
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approach to realizing this objective is to have human rights auditors on an annual
basis auditing a company’s human rights practices. This will also create a new
profession.
4.0 SECTOR SPECIFIC RECOMMENDATIONS
4.1 Banking Law
1. To create consumer awareness and confidence in mobile banking by
disseminating the information to the rural and the unbanked population.
2. To regulate the M-Payments and E-Payments system in order to prevent
fraud and unauthorized payments.
3. To put in place mechanisms to trace fraudsters or in the alternative to
provide for adequate remedies.
4. To put in place measures for the regulation of:
a. Bank contracts;
b. Bank interest rates; and
c. Amalgamation and transfer of the bank assets.
5. To restrict the trading done by banks or to amend the Banking Act to
allow for banks to engage in activities in addition to banking.
6. To strengthen CBK’s supervision of the banking sector.
7. To control persons applying for licenses.
8. To call for a specialized judiciary.
4.2 Capital Markets Law
1. To investigate measures that will develop the market.
2. To have the public invest in shares.
3. To list more companies at the NSE.
4. To protect investors and create investor confidence by giving the Investor
Compensation Fund Board the powers to manage the money it holds.
5. To do away with financial illiteracy through public and investor
education.
6. To come up with a clear policy on financial services.
7. To call for a specialized judiciary.
4.3 Corporate Governance
1. To come up with a selection criteria for appointing directors.
2. To assist in an organization’s succession planning.
3. To ensure the minority shareholders are represented in a company.
4. To have human rights auditors on an annual basis auditing a company’s
human rights practices.
5. To call for a specialized judiciary.
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5.0 GENERAL RECOMMENDATIONS FOR THE SCHOOL OF LAW
1. To identify legal challenges, issues and problems within the fields of
commercial and financial law with the aim of engaging in collaborative
research with the main players in these fields in order to come up with
possible answers and solutions.
2. To comment on legislation addressing the emerging trends within these
fields.
3. To facilitate and provide for the School of Law students a lecture forum
and a question and answer session by the main players in these fields.
4. To link the School of Law students to these fields through student
attachments.
5. To enhance the quality of the curriculum on offer in these fields.
6.0 CONCLUSION
The two-day workshop on Banking Law, Capital Markets Law and Corporate
Governance provided an interactive forum to engage in the discourse on the
emerging trends in commercial and financial law in Kenya.
A number of recommendations were advanced following the session
presentations wherein a number of legal problems, challenges and issues
were identified. The discussion sessions also facilitated a better
understanding of the legal challenges and problems that Kenya is faced
with.
The workshop ended with the suggestion that there has now arisen the
need to undertake collaborative research and teaching between the
University of Nairobi, School of Law and the industry players.