NCA CONTRACTOR REGISTRATION
The National Construction Authority (NCA), constituted under the Act No. 41 of 2011, is mandated to register contractors and to keep a register of builders cleared to work in Kenya.
This reduce the amount of malpractices that have seen buildings collapsing and many key state projects being delayed.
How to register with NCA?
Here are the NCA requirements for registration as a contractor in Kenya, including requisite fees, charges, categories, and classes for contractors.
for registration as a contractor, a firm must hold a certificate of incorporation from the Registrar of Companies either as a limited liability company, partnership or sole proprietorship.
At least one of the technical directors must have the minimum technical qualification, skills and experience in a construction related field and all the directors must submit their curriculum vitae to the NCA.
The applicant must show tax compliance by providing the Authority with a valid PIN, VAT and Income Tax compliance certificates. They must also produce evidence of an existing bank account bearing the name of the construction firm.
Foreign contractors are issued with a clearance certificate that remains valid for only a specific period. They are required to satisfy the NCA that they are in Kenya for only that specific project.
The firms are required to lodge an affidavit with the Authority that they shall not carry out any other construction project in Kenya once they complete the project for which they have been cleared.
Foreign firms should also submit a commitment to transfer technical skills not available locally to locals as the NCA may determine from time to time.
Upon successful application, the contractor is issued with a ‘Certificate of Registration’
The following are the six must have requirements when registering with the NCA
- Have a Certificate of incorporation from the Registrar of Companies in Kenya which can be a legal limited liability, sole proprietorship or partnership
- Forward all CVS of all technical directors of the registered company to NCA
- Have a valid PIN, VAT and Income Tax compliance certificate and register a bank account under the name of the Contractor Company and provide evidence for the bank account.
- If applying for electrical engineering, have a certificate from Energy Regulation Commission.
- A foreign contractor will be required to have to swear an affidavit with the authority that they will only be in the country for the specific project undertaking.
- There is a registration fee. Local contractors in Kenya will be required to pay a fee of Ksh. 10, 000 –50, 000 depending on category in order to register. License renewal costs are valued at between Ksh. 5, 000 and Ksh. 10, 000. Between Ksh. 5, 000 and 10, 000 will be required for annual renewal of license.
Foreign contractors willing to register with National Construction Authority to operate in Kenya are required to pay a registration fee of Ksh. 100, 000 and must undertake only tenders they win. Those registering under a temporary registration will need to commit to sub-contracting “not less than 30% of the value” of contract to local contractors
2.) Classification of Contractors
According to the NCA rules and regulations, a contractor may be registered for several categories of construction works but may hold only one category of registration in relation to a particular class of construction works.
These classes include:
NCA1 – unlimited contract value [Contractors – Building], unlimited contract value [Specialist Contractors], unlimited contract value [Roads and other Civil Works].
NCA2 – Up to Sh500,000,000 [Contractors – Building], Up to Sh250,000,000 [Specialist Contractors], Up to Sh750,000,000 [Roads and other Civil Works].
NCA3 – Up to Sh300,000,000 [Contractors – Building], Up to Sh150,000,000 [Specialist Contractors], Up to Sh500,000,000 [Roads and other Civil Works].
NCA4 – Up to Sh200,000,000 [Contractors – Building], Up to Sh100,000,000 [Specialist Contractors], Up to Sh300,000,000 [Roads and other Civil Works].
NCA5 – Up to Sh100,000,000 [Contractors – Building], Up to Sh50,000,000 [Specialist Contractors], Up to Sh200,000,000 [Roads and other Civil Works].
NCA7– Up to Sh20,000,000 [Contractors – Building], Up to Sh10,000,000 [Specialist Contractors], Up to Sh50,000,000 [Roads and other Civil Works].
NCA6 – Up to Sh50,000,000 [Contractors – Building], Up to Sh20,000,000 [Specialist Contractors], Up to Sh100,000,000 [Roads and other Civil Works].
NCA8– Up to Sh10,000,000 [Contractors – Building], Up to Sh5,000,000 [Specialist Contractors], Up to Sh20,000,000 [Roads and other Civil Works].
Local contractors pay registration charges of between Sh5,000 and Sh100,000 depending on their categories, while annual practice license renewal costs between Sh2,500 and Sh30,000.
On the other hand, foreign contractors pay a registration fee of Sh250,000 and are restricted to categories of tenders they win.
Foreign contractors applying for temporary registration are required to commit to sub-contract “not less than 30 per cent of the value” to local contractors.
Under new regulations that seek to protect local contractors from being driven out of business by global firms, foreign contractors will not be cleared to carry out work below NCA1 category.