Resident Director, Nominee Director or Work Permit? Staffing the Board of a Foreign-Owned Kenyan Company

A foreign-owned company setting up in Kenya usually asks this question the wrong way round: “do we need a resident director?” The honest answer is that Kenyan company law does not require one directly. What it requires is a way to be reached, taxed and, if someone wants to work in the business day to day, lawfully present. A resident director, a nominee director and a work permit each solve a different piece of that problem, and conflating them is where founders get into trouble.

What the Law Actually Requires

Section 129 of the Companies Act, 2015 requires a company to have at least one director who is a natural person. It says nothing about that person’s nationality or residence. A company can lawfully have an all-foreign, entirely non-resident board.

The consequence falls elsewhere. Under section 243A, a private company that has neither a company secretary qualified in Kenya nor a director resident in Kenya must appoint a contact person: a natural person with a permanent residence in Kenya who maintains the company’s records and is available to the Registrar and other authorities. We cover this obligation in detail in our guide to the contact person rule. A Kenya-resident director simply removes the need for a separate contact person; it is not itself a standalone legal requirement.

The Nominee Director Route

A nominee director is someone who holds the office of director on the company’s register while a shareholder, often the same person who would otherwise sit on the board, directs matters informally from outside Kenya. It is a common answer to the section 243A problem and to banks that want a locally reachable signatory.

It comes with a legal reality that catches people out: a nominee director owes the same duties as any other director, and owes them to the company, not to whoever nominated them. Section 144 of the Companies Act specifically requires a director to exercise independent judgement, and section 140 confirms that every general duty in that Part is owed to the company. A nominee cannot simply rubber-stamp instructions from an absent shareholder if doing so would breach those duties, and cannot be indemnified out of company funds for a breach.

There is also a tax consequence that is easy to miss. Under section 15 of the Tax Procedures Act, a person is automatically the taxpayer’s “tax representative” for a company if they act as a resident director, alongside the chief executive, managing director, company secretary or treasurer. Appointing a nominee director without addressing this can leave that individual holding statutory tax obligations they never priced in.

The Work Permit Route

The alternative is for the founder to become the resident director in substance, not just on paper, by obtaining a work permit and relocating, or spending enough time in Kenya to run the business directly. Section 34 of the Kenya Citizenship and Immigration Act makes the presence of a non-citizen in Kenya unlawful unless they hold a valid permit or pass. Section 45 goes further: it is the employer’s duty to obtain a work permit for a foreign national before employing them, and the law presumes the employer knew of the person’s status at the time. Section 53(1)(m) makes it an offence for a non-citizen to engage in business without authorisation, carrying on conviction a fine of up to KES 500,000, imprisonment of up to three years, or both, under section 53(2).

Which permit class fits depends on the role and the capital involved; we set out the full list in our guide to Kenya’s work permit classes, and current government fees in our guide to 2026 work permit fees. Once the permit is issued, the founder can act as a genuine resident director, sign for the company at a bank, and hold the statutory tax representative role directly rather than passing it to a nominee.

Liability: Where Each Route Actually Bites

A tax representative’s personal exposure is narrower than most people assume. Section 16 of the Tax Procedures Act makes a tax representative personally liable for unpaid tax only where they disposed of or alienated money or funds belonging to the taxpayer, held in their possession, while the tax remained unpaid; simply holding the title does not create blanket liability. Section 18 imposes a harder-edged liability on directors and controlling members, but only where an arrangement was entered into with the intention or effect of rendering the company unable to meet a tax liability, in which case every director or controlling member at the time is jointly and severally liable. Ordinary trading losses do not trigger this section; deliberate structuring to defeat a tax debt does.

The immigration exposure sits with whoever is actually working without authorisation, and with the employer who let them. A director who is genuinely never in Kenya and never works in the business here does not need a permit merely by holding the title. The risk arises when a “non-resident” director is, in practice, running day-to-day operations from inside the country.

Which Route Actually Fits

A nominee director suits a company that genuinely will be run from abroad, needs a local signatory for banking and compliance, and is prepared to give that person real authority to exercise independent judgement rather than treating them as a formality. A work permit suits a founder who intends to be substantively present and involved. Trying to get the practical benefits of a work permit, day-to-day control, while formally treating the local person as a mere nominee with no real say, is the combination most likely to produce a section 144 problem, a tax representative dispute, or an immigration offence.