The TerraLex Cross-Border Foreign Direct Investment (FDI) Guide provides a practical overview of FDI screening and investment control regimes across key jurisdictions worldwide, helping TerraLex members and clients assess regulatory risks in cross-border transactions. This concise guide covers the legal framework for FDI review, filing triggers, substantive tests, approval procedures, timelines, filing requirements, penalties for non-compliance, confidentiality considerations, and available appeal rights. Spanning jurisdictions across Africa and the Middle East, Asia-Pacific, Europe, Latin America and the Caribbean, and North America, it is a valuable resource for navigating foreign investment rules and understanding when government approval may affect deal timing, structure, and execution.
FDI in Tanzania is regulated nationally, primarily by the Tanzania Investment Act (2022). As a non-Union matter, mainland Tanzania and Zanzibar maintain separate but similar investment laws and policies.
The Tanzania Investment Centre (TIC) oversees investment in mainland Tanzania, acting as a "one-stop shop" for guidance and filing. Zanzibar’s equivalent is the Zanzibar Investment Promotion Authority (ZIPA).
Please indicate triggering transactions (internal reorganizations, domestic transactions, indirect acquisitions of shares or assets or portfolio investments, and any exempted categories of transactions); what constitutes a “foreign investor” (including connected persons or corporate bodies); any control, turnover or value thresholds; activities/sectors.
An FDI review is triggered when a foreign investor seeks a TIC Certificate of Incentives, typically requiring a minimum investment of USD 500,000 for foreign-owned enterprises and 50,000 for locals.
While FDI control lacks a single substantive test, reviews evaluate project viability, economic contribution, and compliance with the Tanzania Investment Act 2022. The Act also restricts foreign equity in sectors like aerospace, banking, and insurance.
Tanzania’s FDI regime requires pre-closing filing; investors must obtain a TIC Certificate of Incentives before commencing operations. While no strict statutory deadlines exist, the TIC is expected to process applications promptly.
No, but there is a registration fee of USD 1,100.
The application for a new investment must include details such as the name and address of the proposed business, its legal form, details of directors and shareholders, the nature of the business activity, the proposed capital structure, and evidence of sufficient capital.
The investor or the business enterprise seeking to make the investment is responsible for submitting the application to the TIC.
Failing to register with the TIC means the investor will not be eligible for the various fiscal and non-fiscal incentives offered under the Tanzania Investment Act, 2022. There are no specified penalties for late filing, but the benefits are only conferred upon registration.
While not explicitly stated as a suspension requirement, it is practically necessary to await the TIC's approval to ensure the investment is eligible for incentives. Proceeding without a Certificate of Incentives would mean forgoing the benefits and potentially facing regulatory hurdles later on.
The TIC's mandate is primarily focused on investments that meet the minimum capital threshold for registration. However, other sector-specific regulators may have the authority to review investments that do not fall under the TIC's purview.
The TIC can either approve an application and issue a Certificate of Incentives, or it can reject the application. The new Investment Act has removed the time limitation for an investor to appeal a rejected application.
The TIC can impose conditions related to the implementation of the project as per the projections submitted in the application. Failure to comply with these conditions can lead to the revocation of the Certificate of Incentives.
Yes, investors have the right to appeal a decision by the TIC. The Tanzania Investment Regulations, 2023, outline the procedures for appealing decisions related to the rejection or revocation of a Certificate of Incentive.
The FDI procedure involves the following steps:
The timeline for this process is not fixed, but the TIC aims to streamline it through its one-stop facilitation center.
The information submitted to the TIC is treated with confidentiality. However, the government may publish general information about registered projects for statistical purposes.
(e.g. declaration to public authorities for the purpose of establishing the balance of payments, control of transactions involving foreign subsidiaries, control of outbound investments)?
Yes, there are other controls to be aware of. These include:
Disclaimer: This guide contains summaries of general principles of law. It is not a substitute for specific legal advice and should not be relied upon in relation to the application of the law or subject matter covered.
