Contributing an expert paper presented by Advocate Ally Kileo during the ‘Continuous Legal Education,’ sessions of the ongoing Tanganyika Law Society half annual general meeting taking place here, the learned friends called for a wider approach to dispute settlement mechanism in the current amendments for the Tanzania Investment Act.
Ally Kileo of the advocate of MDM law group who also serves as an advocate of the High Court of Tanzania and subordinate courts, presented a paper on ‘Corporate incentives to foreign direct investments and investors in context of relevant legislation worth lawyers’ attention, to facilitate risks mitigation and enhancement of abidance by investors.
Co-presented with Professor Josephat Kanywanyi, from the University of Dar-es-Salaam’s School of Law, the paper had also endorsed the alignment of the new Tanzania Investment Act with other Financial Acts specifically the Value Added Tax Act, the Tanzania Revenue Authority Act; the Income Tax Act, Vocational Educational and Training Authority Act, and the East African Community Customs Management Act.
“That should be done with a view of removing inconsistencies that render the domestic investment climate unattractive to especially strategic or major Foreign Direct Investments,” pointed out advocate Kileo, adding that inconsistencies in the law and frequent legislative changes especially on the tax regimes affect investments predictable environments stipulated under the Tanzania Investment Act.
“The Tanzania Investments Act provides that, whenever there is a contradiction between the provisions of the Act and provisions of any other written law in matters relating to investment, the TIA provisions should prevail,” stated the Lawyer.
One of the TLS meeting delegates, Patrick Maleu chipped in the importance of ‘Land Banks’ that should be plots set aside for the sole purpose of investments instead of the current situation where sometimes land is grabbed from ordinary citizens to be provided to investors.
But coming up strongly was the joint recommendation by lawyers, following the presentation that a law needs to be formulated in provision of allowing investments dispute settlements in two statutory forms.
Providing room for innovation and use of the mechanism of dispute settlement, such as conciliation and mediation in one hand as well as the establishment and the use of local court of arbitration, proposed to be known as the Tanzania Court of Arbitration (TCA).
They also called for ensured predictability and consistency in doing business to the Multinational Corporations (MNCs) or multinational business enterprises and Foreign Direct Investments (FDIs) by not derogating the fiscal and non-fiscal incentives and other benefits offered under the legislation unless clearly stated and permitted by Parliament.
“The government should also endeavour to ensure that amendment of the financial legislation is done in a manner that brings predictability, stability and certainty of incentives to the eligible investors,” they suggested.
Tanzania has ratified a number of bilateral treaties relating to investments in promotion and protection of the foreign direct investments with Germany, Netherland, Switzerland, Denmark, Finland, Italy, Norway, Korea, India, South Africa, the United States and United Kingdom, among others.
According to the learned friends, for the past five years Tanzania expanded its network of investment treaties with targeted partner countries including the government of China, Canada, Oman, Kuwait, Mauritius and Kuwait as well as Turkey, Japan and the United Arabian Emirates with the same view in protecting and promoting investments.