TANZANIA RESTRICTS NON-CITIZEN PARTICIPATION IN SPECIFIED BUSINESS ACTIVITIES: WHAT INVESTORS NEED TO KNOW

HIGHLIGHTS

• Fifteen business activities restricted to non-citizens
• Restrictions on issuance and renewal of business licences
• Existing valid licences protected until expiry
• Penalties for prohibited business operations
• Liability extends to Tanzanian citizens who facilitate prohibited activities

1. INTRODUCTION

Tanzania has introduced restrictions on non-citizen participation in specified business activities through the Business Licensing (Prohibition of Business Activities for Non-Citizens) Order, 2025. Made under section 14A(2) of the Business Licensing Act, Cap. 101, and published under Government Notice No. 487A of 28 July 2025, the Order identifies fifteen categories of business activities that non-citizens are prohibited from undertaking. It also restricts the issuance and renewal of business licences for those activities and prescribes penalties for non-compliance.

2. RESTRICTED BUSINESS ACTIVITIES

Under Order 3 read together with the Schedule, non-citizens are prohibited from undertaking the following activities:

1. Wholesale and retail sale of goods, except supermarkets, specialised product outlets and wholesale centres for local producers.
2. Mobile money transfer services.
3. Repair of mobile phones and electronic devices.
4. Salon businesses, except those conducted in hotels or for tourism purposes.
5. Home, office and environmental cleaning services.
6. Small-scale mining.
7. Postal activities and domestic parcel delivery.
8. Tour guiding within Tanzania.
9. Establishment and operation of radio and television stations.
10. Operation of museums and curio shops.
11. Brokerage or agency in business and real estate.
12. Clearing and forwarding services.
13. On-farm crop purchasing operations.
14. Ownership or operation of gambling machines or devices, except within casino premises.
15. Ownership and operation of micro and small industries.

The restrictions cover a range of commercial, service and industrial activities. The exceptions stated in the Schedule should be considered carefully when determining whether a particular business falls within the prohibition.

3. BUSINESS LICENCES AND EXISTING OPERATIONS

Order 3(2) prohibits licensing authorities from issuing or renewing licences to non-citizens for the restricted activities. Accordingly, non-citizens cannot obtain new business licences or renew existing licences for those activities.

However, Order 4 provides a transitional arrangement for non-citizens who held valid licences when the Order came into effect. They may continue operating the relevant businesses until their existing licences expire. The provision does not extend to renewal upon expiry.

4. PENALTIES FOR NON-COMPLIANCE

The Order imposes criminal liability on both non-citizens who undertake prohibited activities and Tanzanian citizens who assist or facilitate them.

Under Order 3(3)(a), a non-citizen who carries out a prohibited activity commits an offence and, upon conviction, is liable to:

• A fine of not less than TZS 10,000,000 or imprisonment for a term not exceeding six months; and
• Revocation of their visa and residence permit.

Under Order 3(3)(b), a Tanzanian citizen who assists or aids a non-citizen in undertaking a prohibited activity is liable, upon conviction, to a fine of TZS 5,000,000 or imprisonment for a term not exceeding three months.

The consequences therefore extend beyond the person directly operating the prohibited business to Tanzanian citizens who facilitate such operations.

5. WHAT INVESTORS AND BUSINESS OPERATORS SHOULD CONSIDER

The Order has direct implications for non-citizens intending to establish, acquire or continue business operations in Tanzania. Before committing capital or entering into business arrangements, investors should establish whether the proposed activity falls within the restricted categories.

Existing businesses should assess their licensing position, actual operations and any applicable exceptions. Particular attention should be given to the specific exclusions concerning supermarkets, specialised product outlets, wholesale centres for local producers, qualifying salon businesses and gambling devices operated within casino premises.

A proper assessment of the proposed business activity is essential. Business registration or incorporation, on its own, should not be treated as confirmation that an activity is permitted under the Order.

Investors and business operators are therefore advised to obtain appropriate legal guidance before commencing or restructuring operations in the affected sectors.

6. WHAT KAZI LAW OFFICE CAN DO

KAZI LAW OFFICE advises local and foreign investors on the application of the Business Licensing (Prohibition of Business Activities for Non-Citizens) Order, 2025. We assist clients in assessing whether their proposed or existing business activities fall within the restricted categories, identifying applicable exceptions and reviewing their business licences and investment arrangements.

We also advise on regulatory compliance, business restructuring and the legal options available to investors affected by the restrictions, including the transitional arrangements for existing valid licences. Our objective is to help investors understand their legal obligations, manage regulatory risks and make informed decisions when conducting business in Tanzania.

7. CONCLUSION

The Business Licensing (Prohibition of Business Activities for Non-Citizens) Order, 2025, is an important regulatory development for investors and businesses operating in Tanzania. Its restrictions, licensing consequences and penalties make it essential to assess the legality of proposed business activities before investment or commencement of operations. Careful legal and regulatory assessment can help businesses avoid non-compliance and make informed investment decisions.

DISCLAIMER

This article is not intended to offer legal advice but rather aims to provide general information on the subject matter discussed. It does not constitute and should not be relied upon as legal advice. KAZI LAW OFFICE explicitly disclaims any responsibility for any loss that may occur if this article is relied upon without first seeking professional legal advice from our legal experts. Individuals should consult qualified professionals for tailored legal guidance related to their specific circumstances.