Understanding the Legal Fee Scale for Auctioneers

Understanding the official auctioneers charges in Nairobi is vital for creditors, debtors, and anyone instructing an auctioneer to ensure transparency and avoid illegal overcharging. These fees are not arbitrary; they are strictly regulated by Kenyan law to protect the public. The primary legislation governing these costs is the Auctioneers Act (Cap. 526) and, more specifically, the Fourth Schedule of the Auctioneers Rules. This schedule provides a detailed, legally binding scale of fees for various services, from proclamation to the final sale. At Swipe Recoveries Experts Ltd, we operate in strict adherence to this statutory fee scale, providing our clients with clear, itemized, and legally compliant cost structures.

The Legal Basis: The Auctioneers Act & The Official Fee Scale

The authority for all auctioneers charges in Nairobi and the rest of Kenya stems directly from the Auctioneers Act, Cap. 526. This Act establishes the Auctioneers Licensing Board, which is responsible for licensing and regulating the conduct of auctioneers. A critical part of this regulation is the enforcement of the official fee scale as stipulated in the Fourth Schedule of the Auctioneers Rules, 1997. This schedule is not merely a guideline; it is the law. It is illegal for a licensed auctioneer to charge fees exceeding the amounts prescribed in this schedule. Any agreement made between an auctioneer and a client to pay higher fees is considered void and unenforceable in a court of law.

This legal framework ensures that the charges are predictable and fair. It categorizes fees based on the specific action taken by the auctioneer, such as serving a proclamation notice, attaching movable property, or conducting an auction. This protects debtors from being burdened with exorbitant costs during the recovery process and gives creditors a clear understanding of the expenses they will incur, which are then recovered from the proceeds of the sale. Our team at Swipe Recoveries is trained extensively on these rules to ensure 100% compliance.

auctioneers charges nairobi
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A Detailed Breakdown of Regulated Auctioneer Fees

The Auctioneers Rules provide a comprehensive breakdown of chargeable fees. Here are the key components you should be aware of when engaging an auctioneer in Nairobi:

1. Fees on Proclamation/Distraint for Rent: When an auctioneer serves a proclamation notice for unpaid rent or to attach assets, there is a fixed fee based on the value of the debt. For example, for debts up to KES 100,000, the fee is set at a specific KES amount.
2. Attachment Fees: For seizing and attaching movable property (like vehicles or office equipment), fees are charged based on the value of the goods attached, again following a prescribed scale.
3. Commission on Sale of Goods: This is the most significant charge. When movable or immovable property is sold at auction, the auctioneer earns a commission based on the sale price. The scale is tiered. For example, the commission might be:
10% on the first KES 100,0005% on the next KES 900,0003% on the next KES 1,000,000And so on, with the percentage decreasing as the value increases.
4. Disbursements: These are out-of-pocket expenses that the auctioneer incurs and is entitled to recover. They must be necessary and supported by receipts. Common disbursements include advertising costs (newspaper ads), transport, security/storage, locksmith fees, and police assistance if required. An auctioneer must provide a detailed and receipted account of all disbursements.

Debt Recovery & Auctioneering Coverage in Nairobi, Kenya

Swipe Recoveries Experts Ltd provides commercial recovery, skip tracing, and auctioneering services across Nairobi, Kenya and all 47 counties in Kenya.

Calculating Charges & Ensuring Compliance (in KES)

A calculator and a document showing the official auctioneers charges in Nairobi.

To illustrate, let's calculate the commission on the sale of a motor vehicle for KES 1,500,000 at an auction in Nairobi. Using a typical tiered structure from the Rules:

- 10% on the first KES 100,000 = KES 10,000
- 5% on the next KES 900,000 = KES 45,000
- 3% on the remaining KES 500,000 = KES 15,000

Total Commission = KES 10,000 + KES 45,000 + KES 15,000 = KES 70,000.

To this, the auctioneer would add the receipted disbursements (e.g., KES 15,000 for newspaper ads and KES 10,000 for storage). The total cost recovered from the sale proceeds would be KES 95,000. It is your right to demand an itemized 'Bill of Costs' from the auctioneer. If you suspect you have been overcharged, you can have the bill 'taxed' by a magistrate's court, where a court officer will review the charges against the legal scale. Choosing a reputable firm like Swipe Recoveries from the outset ensures you receive a fair and legally compliant fee note every time.

Frequently Asked Questions

Who pays the auctioneer's charges in Nairobi: the creditor or the debtor?
The instructing party (the creditor) is initially responsible for paying the auctioneer's fees and disbursements. However, these costs are legally considered part of the recovery process. Therefore, they are the first charge on the proceeds of the sale. In effect, the debtor ultimately bears the cost, as it is deducted from the sale amount before the balance is remitted to the creditor.
Can an auctioneer charge for transport or storage without a receipt?
No. According to the Auctioneers Rules, all disbursements, which include costs like transport, advertising, and storage, must be backed by actual receipts. The auctioneer is only entitled to be reimbursed for necessary and proven expenses. If they cannot provide a receipt for a particular cost, you are not obligated to pay it, and it can be challenged during taxation.
How does Swipe Recoveries ensure its auctioneers charges are transparent and fair?
At Swipe Recoveries Experts Ltd, ethical practice is our priority. We strictly adhere to the Auctioneers Act fee schedule. We provide every client with a detailed, itemized Bill of Costs that clearly outlines all commissions and receipted disbursements. Our office on Mama Ngina Street is always open for clients to review their accounts and ensure full transparency.