KENYA Law and Practice Contributed by: Sammy Ndolo, Njeri Wagacha, Brian Muchiri and Valere Nyaboke, Cliffe Dekker Hofmeyr
7.4 Regulation of Programmers and Programming
diligence, and upholding high standards of market conduct. A market intermediary is also required to adhere to the following principles: • ensuring that any agreement, written communica - tion, notification or information provided to clients is presented clearly and fairly; • determining whether any of its clients are insiders and keeping records that support effective moni - toring of insider dealing; • holding clients’ funds in trust on their behalf and keeping client bank accounts segregated from any accounts containing the intermediary’s own funds; and • avoiding any conflict of interest between itself and its clients. 7. High-Frequency and Algorithmic Trading 7.1 Creation and Usage Regulations High‑frequency and algorithmic trading are not regu - lated in Kenya. However, one of the robo‑advisers that exited the CMA Sandbox, FourFront Management, is offering algorithmic trading services as part of its robo‑advisory solutions. These services fall under the scope of the letter of no‑objection issued by the CMA. As there is no regulatory regime for high-frequency and algorithmic trading, there are no market players acting in a principal capacity who would need to reg - ister as market makers. 7.3 Regulatory Distinction Between Funds and Dealers As there is no regulatory regime on high-frequency or algorithmic trading, there is no distinction between funds and dealers that engage in these activities. 7.2 Requirement To Be Licensed or Registered as a Market Maker When Functioning in a Principal Capacity
As there is no regulatory regime on high-frequency or algorithmic trading, there are no regulations with respect to programmers who develop and create trad - ing algorithms and other electronic trading tools.
8. Insurtech 8.1 Underwriting Processes
The Insurance Act does not establish any specific regulations that apply exclusively to insurtech entities, nor does it impose particular underwriting require - ments on them. In practice, the underwriting process for participants in the insurance industry is guided by the guidelines and circulars issued by the Insurance Regulatory Author - ity (IRA). The IRA has published a range of guidelines requiring industry participants to develop clear cri - teria for risk assessment, as well as to continuously monitor and update their processes where necessary. These include, among others, the IRA guidelines on insurance products, risk management, and market conduct. 8.2 Treatment of Different Types of Insurance The Insurance Act provides for the regulation of both general insurance business and long‑term insurance business, treating these two categories differently. Long‑term insurance business includes any of the fol - lowing classes: • life assurance; • annuities; • pensions (personal pension or deposit administra - tion); • group life; • group credit; • permanent health; • investment (unit‑linked and linked investments or non‑linked investments); and • any incidental business.
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