There are two types of land ownership tenures in Kenya, i.e., leasehold and freehold. Freehold land tenure system gives the holder or purchaser of the land an absolute ownership to it, for life. This implies that, the owner’s descendants or next of kin are able to inherit or succeed the owner for as long as the family lineage continues. It has no restrictions as to the use or occupation of the land, save as for when certain conditions come along, such as when specified as agricultural land, or ranching purposes, etc. it is also referred to as absolute proprietorship or a fee simple.
On the other hand, leasehold tenure system is one where the interest in land is for a determinate period, dependent on the payment of a fee or rent to the lessor or grantor. The lease period is usually dependent on the agreement reached between the parties. Upon the expiry of a lease, if the lessee does not elect to renew it, the property automatically reverts back to the owner.
Citizenship
In offering the definition of a citizen in Kenya, the Constitution under Article 13(2) provides that citizenship may be acquired by birth or registration. Citizenship through registration can be achieved through marriage to a citizen for a minimum of seven years, through lawful residency in the country for a minimum of seven years or through adoption.
Companies or body corporates are deemed to be citizens if all their shares are held by Kenyan citizens. Further, if the shares are being held in trust, the beneficial interest of the trust is enjoyed or held by Kenyan citizens.
Legal provisions & limitations
Article 40(1) of the Constitution guarantees every person the right, either individually or in association with others, to acquire and own property of any description, and in any part of Kenya. However, this is subject to Article 65 which is the guiding provision for landholding by non-citizens. While a non-citizen is allowed to acquire and own land, they are limited to leasehold tenure only. Further, such leasehold tenures shall not be for a period exceeding ninety-nine years.
The Constitution acknowledges that there are foreigners who did acquire their land prior to the promulgation of the Constitution of Kenya 2010- land whose leasehold terms exceed 99 years, or on freehold land tenure. The owner(s)’ interests in such tenure systems shall be reduced to a 99-year leasehold interest. Should they wish to prolong their ownership, they shall be required to apply for an extension or renewal of the lease at the expiry of the 99-year term (Section 13 of the Land Act).
Further, the Land Control Act specifically restricts the ownership by non-citizens of agricultural land or land within land control areas, i.e., those situated outside a municipality, township, market, or land designated by the Minister of Lands a being controlled and subject to the protections in the Act (Section 6, as read together with Section 9 of the Land Control Act). This restriction extends to non-citizen companies as described above. Any foreigner seeking to acquire or own land in such restricted places ought to seek an exemption from the President of the Republic of Kenya, who through a notice in the Kenya Gazette, may exempt any person from all or any of the Act’s provisions.
However, public companies in which foreigners are members may acquire agricultural land. This can be done through owning shares in a public company that owns agricultural land.
Case-laws
In Kunde Road Residents’ Welfare Association v Deshun Properties Company Ltd & 4 others; ELC Petition No. 1433 of 2013, J. Gacheru expressed himself as follows-
“The Constitution at Article 40 guarantees ownership of land in Kenya by any person. Granted, this provision is not absolute as it is subject to Article 65 thereof which restricts land to be held by non-citizens only as leasehold of a term of 99 years and no more. Article 65(2) of the Constitution, in my view, envisages a situation where non-citizens can enter into transactions for acquisition of interest in land that is freehold. Indeed, there is no law that prohibits non-citizens from acquiring and owning freehold land, the Constitution however restricts that ownership to leasehold of a period of 99 years. It is therefore my finding that the transfer of the property in question, though the interest therein being freehold to the 1st Respondent being a non-citizen is not illegal as alleged. The bottom line is that the 1st Respondent has acquired 99-year leasehold interest”
The case of Malindi Law Society v Attorney General & another [2021] eKLR also resolved the issue in relation to foreigners owning land in Kenya as it revolved around the unconstitutionality of Section 47 of the Land (Amendment) Act 2016. The said section defined an ineligible person as being one who is not a Kenyan citizen; or the government of a country other than Kenya or a political subdivision; or a body corporate which has non-citizens as shareholders. Further, Section 47 amended Section 12 of the Land Act and introduced the concept of ‘controlled land’ to mean land in Kenya which is within a zone 25 kilometers from the inland boundary of Kenya; within the 1st and 2nd row from the high water mark of the Indian Ocean, and any other land as may be declared controlled under any statute. The Section thus sought to prohibit ineligible persons from any transactions involving the controlled land, without the approval of the Cabinet Secretary.
The Court ruled that this was an infringement on the rights to own property. It was the court’s opinion that the state had to demonstrate a justifiable need to limit the right, and that the needs of the society were greater than the individual right to deal with property. Without such justification, then the Section was deemed unconstitutional and void.
Misconceptions
-Foreigners are incapable of acquiring or owning property or land in Kenya
-Foreigners can navigate the law and own freehold property under a trust (this is only to the extent that the beneficial interest of the trust is held by people who are citizens)
-Foreigners can own freehold property through establishing and forming companies (in order for a company to own freehold property, it must be wholly owned by one or more citizens)
Conclusion
Non-citizens can own property in Kenya and enjoy all legal rights and protections that Kenyan citizens enjoy, subject to the Constitutional restriction that non-citizens can only own leasehold land for a term of not more than 99 years, and the statutory restriction in the Land Control Act which bars non-citizens from owning or dealing in agricultural land. Foreigners are advised to seek professional legal assistance when seeking to buy or invest in property, and steer clear of misconceptions or shady suggestions that are certainly unenforceable and jeopardizes their investments.
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