In October 2025, Kenya passed the Privatization Act, 2025, a law that now guides how government-owned companies and assets may be transferred to private ownership. The law, which took effect on 4 November 2025, replaces the old privatization framework and introduces stronger oversight, public participation, and accountability. For many Kenyans, privatization is not just a legal term—it affects electricity bills, transport costs, access to water, jobs, and public services.
Most Kenyans have already experienced privatization, even if they did not call it by that name. For example, Safaricom, once fully government-owned, was partially privatized through a public share offer. Today, millions of Kenyans own shares in the company, and its growth has transformed mobile communication, mobile money, and employment opportunities. The new law seeks to ensure that future privatizations follow clear rules so that similar success stories benefit the wider public and not just a few insiders.
According to the Privatization Act, privatization is meant to improve efficiency, raise revenue, and enhance service delivery. A good example is Kenya Airways, which has struggled financially for years and required repeated government bailouts. Under the new law, if such an entity were proposed for privatization, the government would need to clearly explain how private investment could reduce losses, improve management, and protect public funds—before Parliament and the public approve the move.
One major change introduced by the Act is the strong role of the National Assembly. No public entity can be privatized without parliamentary approval. This is important because past privatizations—such as those involving sugar factories like Mumias Sugar Company—raised public concern over asset stripping, job losses, and poor oversight. Under the new law, Parliament must examine whether privatization protects workers, benefits farmers, and serves national interests before giving approval.
The law requires public consultation before any privatization programme is approved. This is particularly important in rural and county-based economies. For instance, if a state-owned agricultural processing plant or regional water service provider is proposed for privatization, farmers, workers, and local residents must be consulted. This prevents situations where communities wake up to discover that an important local asset has been sold without their knowledge or input.
Not all entities are treated the same. The Act allows the government to restrict foreign participation where national security or strategic interests are involved. For example, infrastructure entities linked to electricity transmission, ports, or fuel storage, such as those connected to Kenya Power or port services in Mombasa, may require majority Kenyan ownership. This protects the country from losing control of critical services while still allowing investment and modernization.
One of the biggest fears Kenyans have is the sale of public assets at throwaway prices. The Act directly addresses this by requiring professional valuation of every entity before privatization and banning secretive asset disposal once an entity is listed for privatization. This responds to past controversies where factories, land, or equipment were allegedly sold below market value, leaving taxpayers at a loss.
Any money raised from selling government shares must be deposited into the Consolidated Fund, meaning it becomes public money. Ideally, such funds can support national priorities like healthcare, education, and infrastructure. For example, proceeds from privatization could help fund county hospitals, road construction, or youth employment programs—if properly managed and overseen by Parliament.
The law gives citizens the right to seek a review or appeal if they believe a privatization decision is unfair or unlawful. For instance, workers affected by the privatization of a state corporation, or community members concerned about the sale of a public utility, can formally challenge the process. This legal protection strengthens democracy and accountability.
The Privatization Act, 2025, is one of the most comprehensive privatization laws Kenya has enacted. However, its success depends on active citizens, vigilant media, responsible leaders, and strong parliamentary oversight. Privatization should not mean loss of public wealth or jobs, but rather better services, stronger institutions, and shared economic growth. With informed citizens and strict enforcement, this law can help Kenya privatize wisely—and fairly—for the benefit of all.
Most Kenyans have already experienced privatization, even if they did not call it by that name. For example, Safaricom, once fully government-owned, was partially privatized through a public share offer. Today, millions of Kenyans own shares in the company, and its growth has transformed mobile communication, mobile money, and employment opportunities. The new law seeks to ensure that future privatizations follow clear rules so that similar success stories benefit the wider public and not just a few insiders.
According to the Privatization Act, privatization is meant to improve efficiency, raise revenue, and enhance service delivery. A good example is Kenya Airways, which has struggled financially for years and required repeated government bailouts. Under the new law, if such an entity were proposed for privatization, the government would need to clearly explain how private investment could reduce losses, improve management, and protect public funds—before Parliament and the public approve the move.
One major change introduced by the Act is the strong role of the National Assembly. No public entity can be privatized without parliamentary approval. This is important because past privatizations—such as those involving sugar factories like Mumias Sugar Company—raised public concern over asset stripping, job losses, and poor oversight. Under the new law, Parliament must examine whether privatization protects workers, benefits farmers, and serves national interests before giving approval.
The law requires public consultation before any privatization programme is approved. This is particularly important in rural and county-based economies. For instance, if a state-owned agricultural processing plant or regional water service provider is proposed for privatization, farmers, workers, and local residents must be consulted. This prevents situations where communities wake up to discover that an important local asset has been sold without their knowledge or input.
Not all entities are treated the same. The Act allows the government to restrict foreign participation where national security or strategic interests are involved. For example, infrastructure entities linked to electricity transmission, ports, or fuel storage, such as those connected to Kenya Power or port services in Mombasa, may require majority Kenyan ownership. This protects the country from losing control of critical services while still allowing investment and modernization.
One of the biggest fears Kenyans have is the sale of public assets at throwaway prices. The Act directly addresses this by requiring professional valuation of every entity before privatization and banning secretive asset disposal once an entity is listed for privatization. This responds to past controversies where factories, land, or equipment were allegedly sold below market value, leaving taxpayers at a loss.
Any money raised from selling government shares must be deposited into the Consolidated Fund, meaning it becomes public money. Ideally, such funds can support national priorities like healthcare, education, and infrastructure. For example, proceeds from privatization could help fund county hospitals, road construction, or youth employment programs—if properly managed and overseen by Parliament.
The law gives citizens the right to seek a review or appeal if they believe a privatization decision is unfair or unlawful. For instance, workers affected by the privatization of a state corporation, or community members concerned about the sale of a public utility, can formally challenge the process. This legal protection strengthens democracy and accountability.
The Privatization Act, 2025, is one of the most comprehensive privatization laws Kenya has enacted. However, its success depends on active citizens, vigilant media, responsible leaders, and strong parliamentary oversight. Privatization should not mean loss of public wealth or jobs, but rather better services, stronger institutions, and shared economic growth. With informed citizens and strict enforcement, this law can help Kenya privatize wisely—and fairly—for the benefit of all.
