Key changes as Tanzania unveils overhaul of investment legislation

Tabled in Parliament last week, the Investment and Special Economic Zones Bill, 2024, introduces significant changes, including the merger of the Tanzania Investment Centre (TIC) and the Export Processing Zones Authority (EPZA) into a single institution called the Tanzania Investment and Special Economic Zones Authority.

The consolidation follows a 2023 performance review of public institutions, which highlighted overlapping roles and inefficiencies that resulted in what the government described as high operational costs for the government.

“Therefore, to enhance efficiency in serving investors, this Bill proposes the establishment of a single institution to handle the responsibilities previously executed by the two entities,” the Bill states.

TIC was established in 1997, following the restructuring of the Tanzanian Investment Promotion Centre, which had been in place since 1990.

EPZA was established in 2006 following to oversee the implementation of the EPZ programme.

In 2011 EPZA's responsibilities were expanded to enable EPZA to oversee the Special Economic Zones (SEZ) programme, this is following the revision of the EPZ and SEZ laws of 2011, which made EPZ part of the SEZ programme.

The Bill also seeks to repeal and replace the Tanzania Investment Act of 2022, the Export Processing Zones Act of 2002, and the Special Economic Zones Act of 2006.

By consolidating the three laws, the government aims to eliminate redundancies and create a unified legal framework for investment.

The proposed authority will act as the government's main agency for investment coordination and promotion, while advising on policy matters.

To ensure alignment with national priorities, the Bill also proposes the formation of a National Investment Development Committee, tasked with providing strategic direction, approving investment plans, and recommending incentives for strategic investors.

Integrated electronic platform

Another key change introduced by the Bill is the establishment of a unified electronic system to facilitate investment processes. TIC had already a similar platform in place.

It was named Tanzania Electronic Investment Window (TeIW).

However the newly proposed integrated platform will connect all relevant authorities responsible for issuing permits, licences, and approvals, enabling investors to access all necessary services under one roof.

“This step will enable investors to access services easily without having to deal with multiple institutions for permits or licences,” the Bill highlights.

To address challenges in accessing suitable land for investment, the Bill also proposes the creation of a land bank, a centralised database cataloguing government-designated investment land and privately-owned property available for lease.

Under the proposed provisions, the land bank will serve as a database holding information on available land across the country.

Dispute resolution

Provisions for resolving disputes between investors and the government or the new authority are also included.

The Bill emphasises negotiation as the first step in resolving conflicts, with arbitration or court proceedings as a last resort.

According to the Bill, an investor dissatisfied with a government institution's conduct, action, or decision on investment matters may file a complaint with the authority, which will investigate and resolve the issue based on fairness, transparency, and legal compliance.

Relevant institutions must cooperate to achieve a mutually acceptable solution.

The authority must address complaints within 30 days, ensuring confidentiality of all submitted information and documents.

Detailed procedures for handling complaints will be set out in regulations to guarantee consistency, the proposed law states.

If unsatisfied with the authority's decision, the investor may appeal to the Minister.

The appeal process, including timelines and requirements, will also be outlined in the regulations.

If enacted, the reforms are expected to improve efficiency, reduce bureaucratic hurdles, and enhance the investment climate in Tanzania.

The Bill was tabled to Parliament for first reading last week and is expected to be sent to stakeholders for discussions.

Members of Parliament will also have a chance to debate the proposals and approve or reject them, during the next sitting expected in January 2025.