The National Assembly on Thursday, November 28, passed a landmark bill that will allow local businesses and contractors to secure major government contracts, which were once exclusively awarded to foreign companies.
The Public Procurement and Asset Disposal Amendment Bill 2024 which was sponsored by Molo Member of Parliament Kuria Kimani will now make it hard for foreign companies to outdo local ones in bidding for government tenders.
In the bill, all government contracts below Ksh1 billion will only be awarded to Kenyan contractors.
''I am glad that the National Assembly has approved the Public Procurement and Asset Disposal (Amendment) Bill, which I sponsored. Going forward, contracts below Ksh1 billion will only be awarded to local contractors,'' Kimani pinpointed after the bill was passed.
The bill will further make it mandatory for international firms that will seek to be awarded local contracts to enter joint ventures with local companies before they can be given the green light.
According to Kuria, the stringent provision will allow Kenyan firms to be shielded from unfair competition. Additionally, local firms will also have the ability to learn key business strategies from the joint ventures.
''For contracts over Ksh1 billion, international firms will have to enter into joint ventures with local firms for them to be awarded contracts. This will ensure that our local firms benefit through capacity building and technology transfer from the international firms,'' Kuria stated.
The bill will also make it mandatory for companies to be paid promptly upon completion of their contract works.
Kenyan companies will now have an edge over the unfair competition that was there before when the government mostly awarded major tenders to foreign companies for projects such as road construction.
''Most importantly, the bill will empower local contractors and ensure their competitiveness by curbing monopolies and unfair competition. This will enhance inclusive growth for our local contractors. The Bill embodies our commitment to fostering economic inclusivity, promoting local enterprises, and ensuring public procurement serves as a strategic tool for national development,'' Kimani added.
Consequently, any foreign who will take advantage and try registering their companies using Kenyan citizens will be fined Ksh5 million or be convicted to prison for 5 years.
Kenyans who register companies on behalf of foreigners will be jailed for 3 years or be fined Ksh5 million.
