Uganda-Investment-Guide-2.Pdf
Total Page：16
File Type：pdf, Size：1020Kb
INVESTMENT GUIDE 2016/2017 ALGERIA BOTSWANA ETHIOPIA GUINEA KENYA MADAGASCAR MALAWI MAURITIUS MOROCCO MOZAMBIQUE NIGERIA RWANDA SUDAN TANZANIA UGANDA ZAMBIA ABOUT ALN ALN is an alliance of independent top firms are committed to working together tier African law firms. It is the largest and to provide extensive coverage and on- only grouping of its kind in Africa, with the-ground experience. The network has close working relationships across its consistently been ranked Band 1 in the members and an established network of Leading Regional Law Firm Networks Best Friends across the continent. ALN’s category, by Chambers Global. ALN IN UGANDA ALN Member Firm: MMAKS Advocates MMAKS Advocates has a strong foothold and client satisfaction. in the Ugandan legal industry and a MMAKS advises national and well-earned reputation in Corporate international businesses in banking and Commercial Law. As one of the and finance, real estate, mergers largest law firms in Uganda, MMAKS and acquisitions, capital markets, Advocates is committed to delivering employment and intellectual property. practical and quality legal services with International legal directories such professionalism and integrity. The firm as Chambers Global and IFLR 1000 adopts a proactive approach to high all regard the firm as a top tier firm. quality, timely and efficient legal services. Chambers Global 2016 ranks the firm MMAKS Advocates prides itself on its Band 1 in Uganda. policy of open communication, teamwork “Investors in Uganda benefit from the government’s favourable trade and investment policies, which have greatly improved the business environment and encouraged investment.” – BMI View Uganda Operational Risk Report; April 2016 “The firm [MMAKS Advocates] does great commercial work.” – Chambers Global 2016 CONTENTS OVERVIEW INDUSTRY SECTORS AGRICULTURE 22 POLITICAL OVERVIEW 5 BANKING AND FINANCIAL SERVICES 22 ECONOMIC OVERVIEW 5 ENERGY 23 BILATERAL & MULTILATERAL TREATIES 6 MANUFACTURING 23 REGULATORY ENVIRONMENT 6 OIL AND GAS 23 TELECOMMUNICATIONS 25 TOURISM 25 INVESTMENT PROMOTION KEY DEVELOPMENTS INSTITUTES GOVERNING INVESTMENT PROMOTION 9 INVESTMENT INCENTIVES 9 ENERGY AND INFRASTRUCTURE 27 FINANCIAL SERVICES 27 NATURAL RESOURCES 28 TAX OTHER DEVELOPMENTS 29 INCOME TAX 11 CAPITAL GAINS TAX 11 WITHHOLDING TAX 11 OTHER TAX 12 STAMP DUTY ON A TRANSFER 12 TRANSFER PRICING & THIN CAPITALISATION 12 DOUBLE TAX TREATY WITH MAURITIUS 13 DOING BUSINESS ACCOUNTING PRINCIPLES 15 INDUSTRIAL RELATIONS 15 REAL PROPERTY 16 COMPETITION 16 CONSUMER PROTECTION 16 EXCHANGE CONTROL 17 IMPORTS AND EXPORTS 17 LEGAL FORMS OF INCORPORATION 17 INTELLECTUAL PROPERTY 19 DISPUTE SETTLEMENT 20 OVERVIEW POPULATION 39.032 Million (2015 World Bank Data) GDP USD 26.37 Billion (2015 World Bank Data) CAPITAL CITY Kampala AREA 241, 038 km2 PRESIDENT CURRENCY DRIVES ON Yoweri Kaguta Museveni Uganda Shilling (UGX) The Left GOVERNMENT LANGUAGES TOP LEVEL DOMAIN Unitary English and Swahili .ug TIMEZONE CALLING CODE GMT + 3 +256 4 POLITICAL OVERVIEW The Ugandan President is elected by institutions. The national legislature is universal suffrage every five years and Parliament and has the majority of its acts both as the Head of State and Head members elected by universal adult of Government. The President appoints suffrage, whilst the remainder represent a Vice-President and Prime Minister to special interest groups including youth, assist in the supervision of the cabinet. women, workers persons with disability The Vice-President deputises the and the army. Uganda held presidential President. The Prime Minister is the leader and parliamentary elections in February of the government business in Parliament 2016, returning the National Resistance and is responsible for coordinating and Movement led by H. E. Yoweri Kaguta implementing government policies across Museveni. ministries, departments and other public ECONOMIC OVERVIEW The Ugandan Government continues the National Vision of a transformed to adopt important policies to ensure Ugandan society from a peasant to economic rehabilitation and promote a modern and prosperous country rapid economic development, and within 30 years. Uganda Vision 2040 is Uganda has won acclaim for its conceptualised around strengthening the macroeconomic management in recent fundamentals of the economy to harness years. Uganda was the first country the abundant opportunities including oil to be eligible for the Heavily Indebted and gas, tourism, minerals, ICT business, Poor Countries (HIPC) initiative and had abundant labour force, geographical virtually all of its foreign debts cancelled location and trade, water resources, by the IMF, World Bank and major industrialisation and agriculture. donors. The economy is set to benefit from For the financial year 2014/2015, the the planned start of oil production. country recorded a 5 percent real GDP The Government recently signed a growth. For the financial year 2015/2016, memorandum of understanding with oil growth in GDP was projected at 5.8 companies on sustainable development percent, with growth in the agriculture, of the discovered petroleum resources forestry and fishing sectors combined in the Albertine Graben. The MoU projected at 2.3 percent, industrial sector provides a framework for achieving a at 5.5 percent and services at 5.7 percent. harmonised commercialisation plan for the development of the country’s oil Despite the slow rate at which it is and gas resources. The plan includes the growing, the agriculture sector (including use of petroleum for power generation, forestry and fishing) employs over 65.6 supply of crude oil to the refinery to be percent of the country’s workforce. In developed in Uganda by Government addition, the Government has developed and export of crude oil through an export a Uganda Vision 2040 to operationalise pipeline or any other viable options to 5 be developed by the oil companies. The in the country estimated at a range of 1.2 commercialisation plan is based on the to 1.7 billion barrels of crude oil. current discovered recoverable reserves BILATERAL & MULTILATERAL TREATIES Uganda is a member of, among with UAE, Seychelles and the East African others, the East African Community, Community are pending ratification. The the Common Market for Eastern and rate of tax generally under these treaties Southern Africa, the African, Caribbean is either 10 percent or 15 percent. The and Pacific Group of States, the World Uganda tax regime has an automatic tax Trade Organisation and the African relief system for income of a resident Union. person which is sourced outside Uganda and has also already suffered tax in that Uganda currently has double taxation other country. This ensures that the tax treaties with nine countries including individual is not subjected to further Denmark, India, Mauritius, Netherlands, taxation in Uganda on income that has Norway, South Africa, United Kingdom, already been taxed elsewhere. and Zambia. Double taxation treaties REGULATORY ENVIRONMENT Uganda generally provides an open to cost USD1.5 billion. climate for foreign investment. The 2015 Index of Economic Freedom ranks Parliament recently enacted amendments Uganda 9th out of 46 countries in sub- to the Financial Institutions Act 2004 that Saharan Africa with a score below the introduce Islamic banking, agency banking world average. Uganda has revised a and bancassurance among other reforms. range of laws and regulations to create The Government is also taking steps to greater government accountability, finally implement the Hire Purchase Act develop infrastructure, and build a more 2009. vibrant public sector. The Government has updated various laws, for example The Capital Markets Authority Act was the Mortgage Act, 2009, the Partnership recently amended in 2016 to broaden the Act, 2010, the Insolvency Act, 2011, the powers of the Capital Markets Authority Companies Act, 2012, the Capital Markets (“CMA”), to provide for the consolidation Authority (Amendment) Act, 2011, and of different licences, to introduce legislation on e-commerce, pensions and transaction specific licences and to create intellectual property. Parliament in 2015 the Capital Markets Tribunal to hear and enacted the Public Private Partnerships determine disciplinary action referred by Act 2015. The Kampala-Jinja Expressway CMA as well as appeals arising from the will be the first public private partnership decisions of CMA. road project in Uganda and is expected 6 Following the oil discoveries, the citizens and Ugandan companies i.e. Government revamped its sector clearing and forwarding, catering, hotel oversight with the passing of two accommodation etc. new laws including the Petroleum (Exploration, Development and Foreign investment is allowed in all Production) Act, 2013 which now sectors of the economy that are not effectively provides the framework national security related. Save as stated for the exploration and production of herein, companies may be 100 percent petroleum. Government also recently foreign-owned. In the oil and gas sector, enacted regulations on National Content. where goods and services required by a The National Content regulations licensee or contractor are not available require licenced oil and gas companies in Uganda, they must be provided by a to give preference to goods produced company which has entered into a joint and available in Uganda and services venture with a Ugandan Company, with rendered by Ugandan citizens and the Ugandan company holding at least companies, to give priority to Ugandan 48