How to Stay Legally Compliant When Trading Gold in Kenya

Staying legally compliant when trading gold in Kenya is essential for local gold dealers, foreign investors, mining companies, and gold exporters seeking to operate within the country’s regulated precious metals sector. As Kenya continues to emerge as a key gold trading and refining hub in East Africa, the government has intensified gold trade compliance efforts to address risks like gold smuggling, money laundering, tax evasion, and environmental violations.

At WKA Advocates, we offer comprehensive legal support and compliance advisory to help gold traders, miners, and exporters navigate Kenya’s complex regulatory landscape and meet all statutory obligations under both domestic and international gold trade laws.

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Understanding the Legal Framework for Gold Trading in Kenya

Gold trading in Kenya is governed by a set of interlinked laws and regulatory bodies. The main law is the Mining Act, 2016, supplemented by other statutes including:

• The Income Tax Act

• The Proceeds of Crime and Anti-Money Laundering Act (POCAMLA)

• The Environmental Management and Coordination Act (EMCA)

• Customs and Border Control Regulations

• OECD Due Diligence Guidelines for Responsible Mineral Supply Chains

These laws regulate every step of the gold supply chain—from mining, sourcing, refining, and transportation, to export and tax compliance. Non-compliance can result in heavy fines, confiscation of gold, loss of licenses, and even criminal prosecution.

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Licensing Requirements for Gold Traders in Kenya

Obtaining the right licenses is the first step to legal gold trading in Kenya. Depending on your business model, the following permits are mandatory:

• Gold Dealer’s Permit – For buying and selling gold locally.

• Gold Export Permit – Required for exporting gold outside Kenya.

• Mining License – Needed if involved in gold extraction or mining.

• Gold Refinery License – For companies refining gold into bullion bars or coins.

At WKA Advocates, we provide end-to-end support for gold license applications, renewals, and compliance with Kenya’s Ministry of Mining requirements.

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Gold Trading and Anti-Money Laundering (AML) Compliance

Kenya enforces strict AML and Counter-Terrorism Financing (CTF) controls on gold transactions to prevent illicit trade. Gold traders are required to:

• Conduct Know Your Customer (KYC) verification on buyers and suppliers.

• Perform Source of Funds and Source of Gold checks.

• Report suspicious transactions to the Financial Reporting Centre (FRC).

• File STRs (Suspicious Transaction Reports) and CTRs (Cash Transaction Reports).

Our legal team helps clients set up internal compliance systems, train staff, and meet all AML and KYC obligations under Kenyan law.

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Tax Compliance for Gold Businesses in Kenya

Understanding and fulfilling tax obligations is critical for compliance. Gold businesses in Kenya are subject to several taxes:

• Royalty Payments – Currently 5% of the gross sales value of gold.

• Corporate Income Tax – Payable by all registered companies.

• Customs and Excise Duty – Applied on imported/exported gold and related equipment.

• Value Added Tax (VAT) – Generally zero-rated on unprocessed gold, but applicable to refined gold products and related services.

WKA Advocates advises gold exporters and dealers on tax planning, dispute resolution with the Kenya Revenue Authority (KRA), and VAT refund processes.

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Exporting Gold from Kenya: Compliance Essentials

Exporting gold legally from Kenya involves strict documentation and customs procedures. You must:

• Obtain a valid Export Permit from the Ministry of Mining.

• Submit an Export Declaration Form (EDF) via the Kenya National Single Window System (KenTrade).

• Secure a Certificate of Assay and Certificate of Origin.

• Use licensed clearing and forwarding agents.

• Adhere to international shipping, packaging, and insurance regulations.

Failure to comply can lead to cargo seizure, delays at customs, international trade restrictions, and reputational risk.

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Environmental and Social Compliance for Gold Traders

Gold traders engaged in refining, processing, or large-scale sourcing must also meet environmental and social compliance standards. This includes:

• Environmental Impact Assessments (EIA) and approvals from NEMA.

• Community consultation and compensation plans.

• Adhering to sustainability policies and biodiversity protection.

We assist gold companies in aligning their operations with Kenya’s environmental laws and international ESG (Environmental, Social, and Governance) expectations, which are particularly important for foreign investors and ethical gold traders.

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Resolving Gold Trade Disputes in Kenya

Disputes in gold trading can arise from issues related to payments, gold purity, supply chain fraud, or breach of contract. Legal remedies are available through:

• The Commercial Division of the High Court of Kenya

• The Nairobi Centre for International Arbitration (NCIA)

• Alternative Dispute Resolution (ADR) mechanisms like mediation or arbitration

Our dispute resolution team at WKA Advocates is highly experienced in managing domestic and cross-border gold trade conflicts efficiently.

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Frequently Asked Questions (FAQs)

Q1. What licenses are required to start a gold trading company in Kenya?
You will need a Gold Dealer’s Permit, Export Permit, and depending on your operations, a Mining or Refinery License.

Q2. How do I verify if the gold I’m buying is legally sourced?
Conduct supplier due diligence, check licenses on the Ministry of Mining’s online cadastre, and comply with OECD sourcing standards.

Q3. Can foreigners legally trade gold in Kenya?
Yes. Foreign investors can set up a Kenyan-registered company and obtain the required permits to engage in gold trading or gold export.

Q4. What taxes apply to gold transactions in Kenya?
Applicable taxes include royalties, corporate income tax, VAT (on refined gold), and customs duties for imported/exported items.

Q5. Does WKA Advocates offer compliance audits?
Absolutely. We offer gold trading compliance audits, legal risk assessments, and regulatory training for both local and foreign gold investors.

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How to Stay Legally Compliant When Trading Gold in Kenya

Remaining legally compliant when trading gold in Kenya means understanding and navigating a robust legal, tax, and regulatory ecosystem. Whether you’re sourcing gold from small-scale miners, refining bullion for export, or operating as a licensed gold trader, WKA Advocates is your trusted legal partner. We offer tailored legal solutions for gold dealers, exporters, refiners, and international buyers looking to build transparent, sustainable, and compliant gold businesses in Kenya.

Contact us today to schedule a compliance consultation or get assistance with gold export licensing, tax planning, dispute resolution, or regulatory audits.