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"id": 494393,
"url": "https://info.mzalendo.com/api/v0.1/hansard/entries/494393/?format=api",
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"type": "speech",
"speaker_name": "Hon. Chepkong’a",
"speaker_title": "",
"speaker": {
"id": 1154,
"legal_name": "Samuel Kiprono Chepkonga",
"slug": "samuel-kiprono-chepkonga"
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"content": "Thank you, hon. Temporary Deputy Speaker. I am suitably guided by yourself. Of course, you have been mean with your words. You probably would have said ‘If hon. Chepkong’a is wise enough, he should conclude before 5.30 p.m.” Owing to your wisdom, I hope I will do so in the few minutes remaining. I rise to second the Insolvency Bill, 2014. From the outset, may I just say that this is, indeed, a very important Bill to this country. It will revolutionise and transform the way we do business. It will inject confidence into the economy of this country. The Bill seeks to repeal the Bankruptcy Act together with its regulations in totality. Secondly, it seeks to repeal all those provisions that relate to liquidation of companies in the Companies Act. Of course, the Companies Act will be repealed upon the National Assembly discussing and passing the Companies Bill that is queuing on the Order Paper. This Bill also intends to amend a number of legislations. I just want to mention them because it is important for us to note them. One, it intends to amend Section 46 of the Advocates Act. It intends to amend the Arbitration Act; the Chattels Transfer Act, Section 70 of the Employment Act, the Hire Purchase Act, Cap.507, the Insurance Act, Cap.487, the Insurance (Motor Vehicle Third Party) Risks Act, Cap.405, and finally the Land Act No.6 of 2012. It is important to note these because upon the passage of this particular legislation, they will all stand amended, particularly the Advocates Act. It deprives the advocates the so-called privilege that they have been enjoying when it comes to matters to do with dissolution of companies and bankruptcy. I will be brief. As I stated, an effective insolvency regime promotes enterprise and stimulates investment. The company law regime, as we know it and as it exists today, is a replica of the 1948 Companies Act of the United Kingdom, or Great Britain as that country is popularly referred to. This is an Act that has already been repealed in the UK; it has become a relic of the past yet in this country, we still cherish it and think that it is the most modern law that can be applied to suit the new situation as it exists in our country. The Act, in its current format, seeks to wind up companies in the old format in which it was done in the UK. This Bill intends to reform the Companies Act and the insolvency law to make it easy to set up and to grow business. The objectives of any working insolvency system is to restore the debtor company to profitable trading, to maximize returns to creditors as a whole, to establish a fair and equitable system for the ranking of claims and distribution of assets, identify the causes of companies’ failure and impose sanctions for culpable management by creditors and officers. This could not be done in the old legislation that is proposed to be repealed, namely the bankruptcy law and the Companies Act, particularly the parts that deal with liquidation. The challenge faced by Kenya is how to create an effective enforcement and insolvency system that fosters strong credit culture, and the economy to promptly respond to default in a way that promotes economic growth and competition, and which aligns local commercial practices with the modern business tactics. An effective insolvency regime is the only possible way to foster public confidence required to fuel investment or commercial activity. Developing such a system will help respond to the financial risks. This particular legislation intends to reform and to The electronic version of the Official Hansard Report is for information purposesonly. A certified version of this Report can be obtained from the Hansard Editor."
}