Since its inception in 2008, Airbnb has taken the global market by storm. In 2018, a report by the Airbnb platform ranked Nairobi third, among the top cities in Africa with the highest number of listed Airbnb facilities. Currently, Kenya ranks in the top ten most visited and trending tourist destinations in Africa despite the Covid pandemic that disrupted many businesses in the country.
In 2021, the Tourism Regulatory Authority (TRA) enacted new regulations on the registration and licensing of Airbnb facilities in Kenya. The regulatory stated that the new regulations were prompted by the dynamic and emerging traveler trends that necessitated different concepts in the local and global spheres.
TRA is a state corporation established under section 4 of the Tourism Act No. 28 of 2011 with the mandate to regulate all tourism activities and services in Kenya. This is achieved through registration, licensing, and quality assurance audits of all tourism activities and services provided countrywide.
Which premises can be listed as an Airbnb in Kenya?
The facilities that can be listed in the Airbnb platform as provided in the Ninth Schedule of the Tourism Act, 2011 include but limited to serviced (furnished) flats and apartments, villas, homestays, condominiums, tree houses, floatels, bandas, beach cottages, holiday cottages, tented camps, and timeshares.
What you need to know about registration & licensing of Airbnbs in Kenya:
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Licensing
Section 7(1)(c) of the Tourism Act, 2011, and Part III of the Tourism Regulatory Authority, Regulations 2014 make it mandatory for persons carrying out tourism businesses and services to be licensed by the Tourism Regulatory Authority (TRA).
For members to be successfully registered by the TRA and be issued a regulatory licence, they are required to make a one-off application fee of Kshs. 1,000/= and an annual licence fee for each unit owned (the rates are provided below) together with the following documents:
- A duly filled application form;
- The original deposit slip/advise for the application & license fee (proof of payment);
- Tariff/rack rates;
- A copy of Title Deed/Lease Agreement for the premises;
- Copies of ID’s/ passport if one is an individual and a Certificate of Incorporation if one is a Company; and
- A copy of the applicant’s PIN Certificate.
The annual licence fee to be paid varies with the type of Airbnb: serviced flats & apartments, villas, holiday cottages, and timeshares are charged a license fee of Kshs. 26,000/= per year; beach cottages, tree houses are charged Kshs. 21,000/= per year and hostels and guest houses are charged Kshs. 11,000/= per year and homestays are charged between Kshs. 1,000/= to Kshs. 3,000/= per year depending on its location.
2. Compliance with standards and requirements set by the TRA
Before issuance of the license, the TRA will dispatch an officer to inspect the premises and confirm if the Airbnb has complied with the standards and requirements listed in the First Schedule of the Tourism Regulatory Authority Regulations, 2014.
Please click here to get more information on the standards and requirements one is required to comply with:
https://eregulations.invest.go.ke/media/Tourism%20Act%20Authority%20Regulations%202014.pdf
3. Other licences to be procured
- NEMA Licence
Section 98(5)(c) of the Tourism Act, imposes an obligation on a host/owner of an Airbnb to procure an environmental impact assessment licence (NEMA licence) over the premise.
- Single Business Permit
An Airbnb is regarded as an income-generating business as such the host is required to obtain a business permit from the County Government allowing the him/her to run the business.
- Home Insurance
It’s important to obtain home insurance to insure the premises and all the belongings in it against life’s unexpected events such as damage, fire, theft, natural causes, or other losses. The plan can further be extended to cover your Airbnb’s employees and occupiers against any liability arising from an accident or incident occurring on the premises.
4. Penalties & Offences
- An application for renewal of the TRA licence must be made within 3 months prior to the expiry of the licence. Failure to make the application for renewal, the host will be liable to pay a penalty of 10% of the license fee for each month they are in default; and
- Failure to apply for a licence or furnish the licence upon request amounts to an offense under the Tourism Act, 2011, and exposes the host to a fine of Kshs.100,000/= or a jail term of up to 18 months or both; and
- Failure to comply with the standards and requirements set by the TRA will lead to the suspension of your licence and the closure of your Airbnb business.
How can we help?
At Property Boutique, we have a team of qualified and experienced real estate experts that will help you in acquiring the required licences to start your Airbnb business. We will advise you on the best location(s) to establish your business, earn from it and ensure that you are in compliance with all the existing laws and regulations.
Written by Cynthia Kitolo
Legal Officer & Advocate of the High Court of Kenya
