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Export Processing Zone Act


The Preamble of the Export Processing Zones Act,1990 states that it is an Act of Parliament  to provide for the establishment of export processing zones and the Export Processing Zones Authority; to provide for the promotion and facilitation of export oriented investments and the development of enabling environment for such investments and for connected purposes.

 Short Title

The Act may be cited as the Export Processing Zones Act, 1990 (s.1)


Custom control’ - refers to measures that ensure compliance with laws and regulations enforced by customs officers.

Duty’-refers to the fiscal, customs and exercise duty for the time being chargeable under any written law. (s.2)

Establishment and membership of the Export Processing Zones Authority

The Act establishes an Authority known as Export Processing Zones Authority(S.3 (1))

The Authority shall have the rights of a corporate body in managing its affairs (S.3 (2))

Members of the Authority shall consist of:

A chairman, a representative of Kenya Manufacturers and Kenya National Chamber of Commerce and Industry; four members  appointed from Private Sector; Permanent Secretary to Treasury; Permanent Secretary to Ministry responsible for Industry; Governor of Central Bank;  Commissioner of customs and Exercise,  Commissioner of Lands, Managing Director of the Investment Promotion Centre and Chief Executive of the Authority (S.3 (3))

Members of the authority arepaid from the General fund of the Authority. (S.3 (6))

Meetings and procedures of the Authority

The chairman is responsible for convening meetings at least once a month (S.4(1))

The quorum of any meeting shall be half its members, and in case the chairman is absent for any other reason, the president may appoint another member temporarily to perform such functions. (S.4 (2)(3))

The Chairman is allowed to resign by writing a resignation to the President (S.4 (4)). 

Any member who has a conflict of interest in any decision shall disclose when such a decision is being taken. (S.4(5))

Appointment of Chief Executive of the Authority

The Ministeris responsible for appointment of Chief Executive of the Authority S.6(1)

The Chief Executive of the Authority is responsible for the general direction of the affairs of the Authority. (S.6 (2))

The Minister may remove Chief Executive Officer from office on recommendation (S.6 (3))

Appointment and remuneration of staff

The Authority may appoint other officers and servants for the efficient discharge of responsibilities and functions(S.7(1))

Protection from legal action

Neither the Authority, any of its members, officers nor servants is liable for anything done in good faith while acting or in exercise of any powers under the Act (S.8(1))

Objectives of the Authority

Principal objectives of the Authority include(S.9);

  • Development of all aspects of the export processing zones, specifically advising on facilitating production in export- Processing Zones (S.9)(1)(a)).
  • Regulation and administration of approved activities within the export processing zones (S. (9)(1)(b)).
  • Protection of government revenues and foreign currency earnings (S.9)(1)(c))

The Authority in carrying out its objectives it may;

  • Advice the Minister on all aspects of development of Export Processing Zones
  • Implement policies and programmes in line with EPZ
  • Identify and map areas to be designated as EPZ
  • Plan the development and maintenance of basic infrastructure of EPZ
  • Process and issue approvals for EPZ
  • Approve EPZ licenses.
  • Promote and market EPZ among investors
  • Issue certificates of origin to EPZ enterprises
  • Provide ‘one stop’ for processing all relevant applications for permits
  • Process building plans and issue relevant approvals.
  • Perform all such administrative functions as would be done by local authorities.
  • Maintain data on the performance of each EPZ and enterprise
  • Enforce compliance of customs procedures within EPZ
  • Enforce compliance with exchange control procedures and other requirements in EPZ
  • Suspend or cancel licence of enterprise/developer who violates Customs Exercise Control Act (cap 113) and Value Added Tax(No.7 of 1989)
  • Perform all incidental functions necessary for the objectives of the Authority(S.9)(2)).

Power of the Authority to make rules

In addition to the general powers under theAct, the Authority has powers to ensure orderly and fair development and operation of EPZ/Enterprises specifically to (S .10):

  • Determine application procedures and criteria for approval of export processing zones/developers/operators/enterprises.
  • Determine procedures for providing benefits to EPZ developers/operators and enterprises.
  • Ensure adequate security within the zone.
  • Determine form of licence, its amendment and revocation.
  • Determine entry of personnel in the EPZ.
  • Require information from developers’ operators and enterprises.

The decision on approvals shall be rendered within 30 days as under the Act (S.10 (2))

Authority shall have a general fund necessary for all monies paid as fees and any monies received by the Authority.

Expenses shall be paid out theFund (S .10(3))

The budget of the Authority shall be approved by the treasury(S .10(4)).

Accounts, etc., of the Authority

The authority shall ensure proper books of accounts are kept (S.12).

Disclosure of information

The Act prohibits disclosure of information under S.12 (2) except permitted by a court of law(S.13 (1)).

A violation of this section is an offence liable to a fine of not more than two hundred thousand or three years imprisonment or both (S.13 (2)).


The Authority may appoint committees to help carry out its general/specific functions (S.14)

Declaration of export processing zone

The Minister on recommendation of the Authority and in consultation with the Minister for Finance may declare any area of Kenya to be an EPZ (s.15).


Facilities, etc., within an export processing zone

The Authority may require a developer to provide and maintain an EPZ such facilities necessary to separate the EPZ from Customs territory(S.16 (1)).

The Authority shall grant permission before one resides in EPZ (S.16 (2)).

The Authority may order removal of any goods from EPZ it considers dangerous to public interest, health or safety (S.16 (3)).

A violation of this section is an offence that attracts a penalty of not more than two hundred thousand shillings or imprisonment of not more than 3 years or both (S.16 (4)).

Activities permitted within an EPZ

Activities permitted to be carried out within an EPZ include manufacturing activities, commercial or service activities(S.17 (1)).

The Minister may increase the activities permitted within an EPZ (S.17 (2)).

Power of Minister to make Rules

The Minister may make Rules for the proper administration of EPZ (S.18).



The Authority has power to issue licences before any person is allowed to operate in EPZ (S.19 (1)).

On receiving an application for a license, the Authority may issuelicence to the personand alsoissue a notice of the same to the KRA indicating every EPZ enterprise’s list of activities and conditions of the licence granted. (S.19 (2)(3))

Register of Licences

The Authority shall keep a register of all licence holders issued (s.20).

Qualifications of export processing zone developers and operators

An EPZ developer/operator shall (S.21):

  • Be a company incorporated in Kenya
  • Have necessary capital and expertise.
  • Lease land for a minimum of 30 years.

Each EPZ developer shall be licenced (S.21 (2)).

Powers of export processing zone developers and operators

An EPZ developer has power to:

  • Act on or appoint an EPZ operator to manage/administrate EPZ on its behalf
  • Lease/sublease or sell land/buildings to licenced enterprises and charged fees (S.22 (1)).

The EPZ developer shall:

  • Make improvements to the export site.
  • Provide or facilitate provision of infrastructure and other services.
  • Provide adequate enclosures to separate the zone area from the customs territory for the protection of revenue.
  • Provide adequate security on the site office accommodation and facilities for customs.
  • Adopt Rules and regulations for businesses within the zone.
  • Maintain adequate and proper accounts and other records.
  • Register any lease agreements and service (S.22 (2)).


Establishment of EPZ enterprises

The Authority shall licence any enterprise before it is established and shall enjoy benefits under Part VIII of the Act (s.23 (1)).

The licence shall be granted by the Authority if the proposed business enterprise (s.23(2)):

  • Is incorporated in Kenya,
  • Proposes to engage in any activity or activities permitted in the EPZ,
  • Shall not have a harmful impact on the environment, or unlawful activities, or a health hazard and;
  • Conducts business in accordance with the law.


Goods deemed to be exported and imported into Kenya (S. 24)

Goods/services are presumed exported from Kenya if brought into an EPZ from any part of Customs territory.

Goods/services are presumed imported into Kenya if out of EPZ into any part of customs territory.

Goods within an export processing zone

Subject to s.17, Goods within an EPZ shall not be removed unless they are for; export into Customs territory with approval, or for repair and maintenance or processing conversion (s.25 (1))

Services provided by EPZ shall be provided to; persons outside Kenya, other EPZ enterprises and persons in the Customs territory (s.25 (2))

Prohibited activities within the export processing zone (S.26)

  • Retail of goods produced in an EPZ is prohibited.
  • Personal consumption of goods manufactured in an EPZ is prohibited
  • Such business as may be approved by the Minister
  • There shall be no handling of usedapparel in EPZ
  • Goods shall not be imported into customs territory by a licence holder.
  • With respect to each building in the EPZ, there shall be commencement of commercial activitiesif already manufacturing activities are taking place.
  • A contravention of this section is an offence and one is liable to a fine not exceeding two hundred thousand shillings or imprisonment not exceeding three years or both.

Removal of goods from an export processing zone

Subject to the Act, goods may be removed from an EPZ under the supervision of a customs officer for export sent to another EPZ or bonded factory (s.27 (1)).

Subject to the Act, goods may be brought into EPZ if they are directly used for manufacture of other goods by a licensed enterprise (s.27 (2)).

A contravention of this provision is an offence and it attracts a penalty of not more than two hundred thousand shillings or imprisonment of not more than 3 years or both; or forfeiture of goods (s.27 (1)).

Benefits accruing to EPZ enterprises

The EPZ enterprises, developers’ operators shall benefit from exemption from all existing and future taxes/duties payable under customs and Exercise Act, VAT act on specific items listed under this section (S.29(1)).

Without bias to subsection (1), other exemptions granted include exemptions from(S.29(1));

  • Registration under the Value Added Tax Act;
  • The payment of excise duties as specified in the Customs and Excise Act(Cap. 427);
  • The payment of income tax as specified in the income Tax Act (Cap. 470);
  • The payment of withholding tax on dividends and other payments to non-residents;
  • Stamp duties on the execution of any instruments relating to the business activities of EPZ;
  • Quotas or other restrictions or prohibitions on import or export trade;
  • Exchange controls on payments for:
  • Receipts of export processing zones exports
  • Payments for raw materials, intermediate goods and other items listed under this subsection.
  • Rent or tenancy controls
  • Any other exemptions as may be granted by the Minister

Inspection facilities

Customs officer shall offer on-site inspection to the EPZ for both imports and exports (S.30).



P. O. Box 50563,


Tel.: 254-45-26421/-6

Fax.: 254-45-26427

E-mail: [email protected],


Application of the East African Community Customs Management Act

The East African Community Customs Management Act shall have application with such exceptions and adaptations and shall apply to any goods even those exempted in this Act(s.44).

Regulations (Section 45)

The Cabinet Secretary may make Regulations under this Act (s.45).

Repeals and Transitional Provisions (Section 46)

This Act Repeals Customs and Excise Act.

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