Prevention of Fraud (Investments) Act

2. Interpretation

Edition: 2023-12-11 · Not commenced

2. Interpretation

(1)In this Act, unless the context otherwise requires—“building society” means a building society registered under the Building Societies Act (Cap. 489);“the committee” means the New Issues committee established by section 4 of this Act;“co-operative society” means a society registered as a co-operative society under the Co-operative Societies Act (Cap. 490);“corporation” means any body corporate whether established or incorporated in Kenya or elsewhere;“dealing in securities” means doing any of the following things, whether as principal or agent, that is to say, making or offering to make with any person, or inducing or attempting to induce any person to enter into or offer to enter into—

(a)any agreement for, or with a view to, acquiring, disposing of, subscribing for or underwriting securities, or lending or depositing money to or with any co-operative society or building society; or

(b)any agreement the purpose or the proclaimed or pretended purpose of which is to secure a profit to any of the parties from the yield of securities or by reference to fluctuations in the value of securities, and “deal in securities” shall be construed accordingly;

“debentures” means any debentures, debenture stock or bonds of a corporation, whether constituting a charge on the assets of the corporation or not;“exempted dealer” means any person declared by order under section 19 of this Act to be an exempted dealer for the purposes of this Act;“foreign company” means any corporation, unit trust or other corporate body incorporated or established outside Kenya;“licence” means a licence granted under this Act and for the time being in force;“local company” means a company registered or deemed to have been registered under the Companies Act (Cap. 486) which is neither a private company nor a foreign company within the meaning of that Act;“manager” and “trustee” in relation to a unit trust have the meanings assigned to them by the Unit Trusts Act (Cap. 521);“the Minister” means the Minister for the time being responsible for matters relating to Finance;“newspaper” includes any newspaper, journal, magazine or other periodical publication;“Permanent Secretary” means the Permanent Secretary to the Treasury;“principal’s licence” means a licence granted under subsection (1) of section 9 of this Act;“prospectus” means any prospectus, notice, circular, advertisement or other invitation, offering to the public for subscription or purchase any securities;“securities” means—

(a)shares or debentures, or rights or interests (whether described as units or otherwise) in any shares or debentures;

(b)securities of the Government of Kenya or of the government of any other country;

(c)securities of statutory corporations and local authorities; or

(d)any other securities or investments, declared by the Minister, by notice in the Gazette, to be securities for the purposes of this Act;

“shares” means shares in the share capital of a corporation or stock in the share capital of a corporation or stock of a corporation;“statutory corporation” means—

(a)a corporation incorporated directly by an act of Parliament,

(b)any other corporation to which functions in respect of the carrying on of an undertaking are entrusted by or under an Act of

Parliament; but, save as provided in paragraph (b) of this definition, does not include a company within the meaning of the Companies Act (Cap. 486);“stock exchange” means a stock exchange, or an association of dealers in securities, recognized as such for the purposes of this Act by virtue of an order made under section 18 of this Act;“unit trust” means a unit trust as defined in the Unit Trusts Act (Cap. 521) and for the time being registered under that Act.

(2)Any reference in this Act to the holder of a licence or of a principal’s licence shall be construed as a reference to the person named in the licence as being thereby authorized to carry on the business of dealing in securities.

(3)Any reference in this Act to a servant of, or to a person employed by, any person shall in relation to a corporation, be construed as including a reference to any director or officer of the corporation; and any reference in this Act to leaving or entering the service of a person shall be construed accordingly.

(4)For the purposes of this Act, a person shall be deemed to be a director of a corporation if he occupies in relation thereto to the position of a director, by whatever name called, or is a person in accordance with whose directions of the corporation, or any of them, act:Provided that a person shall not, by reason only that the directors of a corporation act on advice given by him in a professional capacity, be taken to be a person in accordance with whose directions or instructions those directors act.

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Source: Kenya Law