What happened

The Kenya Revenue Authority (KRA) has officially clarified the documentation requirements under Section 23B of the Customs and Excise Act. In a notice circulated to customs agents and importers, KRA enumerated the exact paperwork that must accompany every import declaration, aiming to curb the frequent rejections and costly delays that have plagued many Kenyan businesses. The clarification emphasizes that incomplete or mismatched documents will trigger automatic holds, and it outlines the penalties for non‑compliance, including possible fines and seizure of goods. This move follows several months of feedback from the private sector, which complained that the previous guidance was vague and left room for interpretation.

Context and background

KRA, the government agency responsible for tax collection and customs administration, has long used Section 23B as the legal basis for requiring importers to submit supporting documents such as commercial invoices, packing lists, certificates of origin, and import permits. Historically, the agency’s instructions were issued in broad terms, leading many importers—especially small and medium‑sized enterprises (SMEs)—to guess which documents were essential for a particular shipment. The lack of precise guidance contributed to a backlog at the Nairobi and Mombasa ports, where customs officers often returned consignments for “insufficient documentation,” causing supply‑chain disruptions and increased costs.

The recent clarification was prompted by a series of stakeholder meetings held earlier this year, where the Kenya Association of Manufacturers, the Kenya Chamber of Commerce, and several logistics firms raised concerns about the economic impact of customs delays. In response, KRA convened a technical working group that reviewed the existing regulations, consulted with industry experts, and drafted a more detailed checklist. The final notice, released in early June 2024, outlines a step‑by‑step process for preparing a compliant import file, including the order in which documents should be presented and the electronic formats accepted through the Integrated Customs Management System (iCMS).

Section 23B itself is part of the broader Customs and Excise Act, which governs the import and export of goods in Kenya. The provision empowers KRA to demand any document it deems necessary to verify the legality, value, and classification of imported items. While the law has always required documentation, the recent clarification narrows the discretionary space previously enjoyed by customs officers, making the process more transparent. The notice also references the East African Community (EAC) Common External Tariff, reminding importers that regional trade agreements still apply and that certain documents—such as the Certificate of Origin for preferential duty rates—remain mandatory.

Compared with what is normal

Before the clarification, the typical experience for many Kenyan importers involved submitting a basic set of documents—usually a commercial invoice and a Bill of Lading—and then receiving a request for additional paperwork after the cargo had arrived at the port. This reactive approach often added 3‑7 days to clearance times, and in some cases, shipments were held for weeks, leading to stock‑outs and lost sales. The new guidance aligns Kenya’s import documentation standards with practices observed in neighboring Tanzania and Uganda, where customs agencies publish detailed checklists and enforce them consistently.

• Document completeness: Previously, importers could submit an invoice without a matching packing list and still expect clearance. The new rule requires both documents to match item descriptions, quantities, and values exactly.
• Electronic submission: While iCMS has been mandatory for filing import declarations, the clarification mandates that supporting documents be uploaded in PDF/A format, reducing the chance of corrupted files that previously caused re‑submissions.
• Penalty structure: Earlier, fines for missing documents were applied on a case‑by‑case basis. The updated notice sets a flat penalty of Sh10,000 per missing mandatory document, providing predictability for businesses.

Why it matters

For Kenyan SMEs that rely on imported raw materials, the clarification offers a clearer path to timely clearance, which can directly affect production schedules and cash flow. By reducing the uncertainty around documentation, businesses can better plan inventory levels, avoid emergency air freight costs, and improve relationships with suppliers abroad. Moreover, the standardized penalties mean that firms can budget for compliance costs rather than facing unexpected fines that erode profit margins.

From a macro‑economic perspective, smoother customs operations contribute to lower port congestion, faster turnaround times for shipping lines, and a more attractive environment for foreign investors. The reduction in clearance delays also supports the government’s broader goal of improving Kenya’s ranking in the World Bank’s “Ease of Doing Business” index, where customs efficiency is a key metric.

Practical steps

• Review the KRA Section 23B checklist: Download the official document from the KRA website and verify that every shipment includes the listed items before filing.
• Standardize internal procedures: Create a template for import files that aligns with the new PDF/A requirement and assign a single point of contact to oversee document accuracy.
• Train customs brokers: Ensure that any third‑party agents you use are aware of the updated requirements and can confirm compliance before submitting declarations on your behalf.
• Monitor clearance times: Track the time each shipment takes from arrival to release and compare it against the pre‑clarification baseline to gauge improvement.
• Budget for penalties: Allocate a small contingency in your import budget for the fixed Sh10,000 fine per missing document, which can serve as an incentive to maintain compliance.

Tax Planning & Compliance services at Beavoren can help your business interpret the Section 23B clarification, align your import processes with the new rules, and ensure that you remain compliant while minimizing tax exposure.

Book a consultation with Beavoren Ventures today and let us handle your compliance, books, and advisory in one place.

Disclaimer: This article is informational and does not constitute formal tax, audit or legal advice. For guidance specific to your circumstances, please contact Beavoren Ventures.