Tanzania is attracting the attention of many international investors, including Vietnamese businesses wishing to expand the market and seek new opportunities. However, in order for the process of investing in Tanzania to take place smoothly and conveniently and minimize the costs incurred, businesses need to master not only the process of establishing a company in the host country but also the necessary legal procedures for overseas investment according to Vietnamese regulations. Viet An Law would like to guide customers through the article below.
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Carry out procedures in Vietnam before carrying out procedures for investment in Tanzania
Apply for an investment certificate
The dossier includes:
Offshore investment registration documents: According to the form in Circular 25/2023/TT-BKHDT (original);
Proof of legal status (Certification)
A commitment to self-balance foreign currency sources or a document of a licensed credit institution committing to arrange foreign currency for investors (Certification).
A document of the tax authority certifying the fulfillment of the investor’s tax payment obligation up to the time of submission of the investment project dossier (Certification).
Decision on outward investment – for institutional investors (Original).
For outward investment projects in the fields of banking, securities, insurance, science and technology, the investor shall submit a written approval of a competent state agency on the satisfaction of conditions for outward investment in accordance with the Law on Credit Institutions. Law on Securities, Law on Science and Technology, Law on Insurance Business (Certificate)
Consular legalization, notarized translation of overseas business registration certificates.
Register for Forex Trading
According to Article 5 of Circular No. 12/2016/TT-NHNN, amended and supplemented by Circular No. 31/2018/TT-NHNN, Circular No. 24/2022/TT-NHNN, after being granted an outward investment registration certificate, the investor must open 01 (one) investment capital account in 01 (one) foreign currency in accordance with the demand for remittance of investment capital abroad at 01 (one) credit institution license and registration of foreign exchange transactions related to outward investment activities with the State Bank.
Except for the case of remittance of investment capital abroad in Vietnam dong, investors are allowed to open and use 01 (one) investment capital account in Vietnam dong and 01 (one) investment capital account in foreign currency at 01 (one) licensed credit institution and register foreign exchange transactions related to outward investment activities with the Bank State.
A dossier of registration for foreign exchange transactions related to outward investment activities includes:
Application for foreign exchange trading related to outward investment activities.
A copy of the outward investment certificate.
A copy of a foreign language, a Vietnamese translation of the written approval or a business license or a document proving the right to conduct investment activities in the host country.
The original of the written certification of the licensed credit institution on the opening of the investor’s investment capital account, clearly stating the account number and type of foreign currency.
The original of the authorized credit institution’s written certification of the amount of money the investor has transferred abroad before being granted the outward investment registration certificate.
Written explanation of the need for remittance of investment capital abroad in Vietnam dong in case of remittance of investment capital abroad in Vietnam dong.
Procedures for investment in Tanzania
Register with the Tanzania Investment Centre (TIC)
After completing the legal procedures in Vietnam and being ready to implement the project in Tanzania, one recommended step for foreign investors is to register with the Tanzania Investment Centre (TIC). The TIC is the focal point of the Government of Tanzania, established under the Tanzanian Investment Law (e.g., Investment Law No. 10 of 1997, and its amendments and supplements) with the main role of promoting, attracting, and facilitating domestic and foreign investment activities. While registration with a TIC is not a mandatory requirement for all types and sizes of investments to be legally operating in Tanzania (registering a business with BRELA is mandatory), obtaining a Certificate of Incentives from a TIC offers significant benefits, especially for projects with large investment capital.
Eligibility to Register with TIC
For foreign investors (100% foreign capital or joint ventures with a majority proportion of foreign capital): The minimum investment capital is usually 500,000 USD.
For Tanzanian investors: The minimum investment capital is usually 50,000 USD or 100,000 USD.
Most legitimate business sectors can be considered for investment, however TIC strongly encourages projects in priority sectors such as manufacturing, agriculture and agro-processing, tourism, infrastructure development, energy, mining (deep processing), etc and information technology. In addition, the project must be economically and technically feasible and have a positive contribution to Tanzania’s socio-economic development (e.g., job creation, technology transfer, increase in foreign currency revenues, environmental protection).
Registration Process with TIC
The list of documents to be prepared includes:
Application Form: According to TIC’s form, it can be downloaded from TIC’s official website via the link below https://www.tic.go.tz/
Detailed Business Plan/Feasibility Study: This is an important document, you need to clearly present the contents such as: Information about the investor; Detailed description of the project: objectives, products/services, scale; Market analysis, marketing strategy; Production/operation plan, technology used; Investment capital needs, capital sources and capital structure; Financial estimates: revenue, expenses, profit, cash flow, break-even point; Personnel plan, expected number of jobs to be created; Socio-economic and environmental impacts (if there is a request for an Environmental Impact Assessment Report – EIA, it is necessary to submit an EIA certificate); Project implementation plan.
Proof of Financial Capacity: Bank confirmation or other documents proving the ability to raise capital for the project.
Information about Shareholders and Directors: Copy of passport/identity document.
Documents on land use rights (if any): Land lease contract, land use right certificate.
The application is submitted directly at the TIC’s office. The TIC will review and evaluate the project application based on the criteria of feasibility, socio-economic benefits and priority policies of Tanzania. If the project is approved, TIC will issue a Certificate of Incentives, which clearly states the specific incentives to which the project is entitled and the conditions attached.
A Private Limited Company (Ltd) is the most popular type for businesses. According to Tanzania’s Companies Act, 2002, a Private Limited Liability Company has the following key characteristics:
Limited Liability: This is the core characteristic. The liability of shareholders for the company’s debts and obligations is limited to the amount of capital they have contributed or committed to contribute to the company. Shareholders’ personal assets are protected from the company’s creditors. In the event that the company is in financial difficulties or goes bankrupt, shareholders only lose the maximum amount invested in their shares.
Membership Requirements:
Shareholders/Members: There must be a minimum of one (1) shareholder and a maximum of fifty (50) shareholders (excluding current or former employees who are shareholders).
Directors: There must be at least two (2) directors. One of the directors may also be a shareholder. For directors who are foreigners, they need to have a Tanzanian Tax Identification Number (TIN) and comply with immigration and labor regulations (if directly working in Tanzania).
Restriction on Share Transfer: The Articles of Association usually stipulate restrictions on the right to transfer shares. Shareholders who want to sell their shares often have to prioritize offering to existing shareholders before selling to the outside.
Prohibition on Public Offering: A Private Limited Company is not allowed to offer its shares or debentures to the public. Capital mobilization mainly comes from private sources, existing shareholders or loans from banks/financial institutions.
There are also other types such as: Public Limited Company (PLC), Foreign Company Branch, Sole Proprietorship, Partnership, Company Limited by Guarantee.
Note: The appointment of a Company Secretary is mandatory. The secretary can be an individual or a company, responsible for ensuring the company complies with legal regulations, keeping the company’s books and records.
Step 2: Name your company
Before setting up a company, one of the important steps is choosing and verifying the name for your intended company. This is done through the Online Registration System (ORS) administered by the Tanzania Business Registration and Licensing Authority (BRELA).
How to perform a name check on ORS
Access the ORS System: Go to the official BRELA website (via the link below https://www.brela.go.tz) and navigate to the ORS portal. You need to create a user account on ORS if you don’t already have one.
Use the name search function: In the ORS interface, there will be a “Free Search” section that allows you to enter the name of the expected company to check if it has been used. Type the name you want to subscribe to in the search box. The system will scan BRELA’s database for the existence of that name or similar names. If the name is available, you can proceed to the next step of name reservation or use it directly during the company registration process.
After checking the name: If the name you choose is available, you can usually proceed with a “Name Reservation” online via ORS. This helps keep the name for you for 30 days so that you have time to complete other necessary paperwork and procedures.
Step 3: Prepare your application and submit your application
The list of documents to be prepared includes:
Memorandum and Articles of Association (MEMART): This is the most important document that clearly states the objectives, scope of activities, capital structure, rights and obligations of shareholders, and internal management rules of the company. In addition, MEMART needs to be notarized by a Notary Public or Commissioner for Oaths in Tanzania.
Declaration of Compliance (Form 14b – Declaration of Compliance): Confirmation that all the requirements of the Companies Law related to incorporation have been complied with. This declaration also needs to be notarized.
Information about Directors and Shareholders:
For Tanzanian citizens: Copy of National Identity Card (NIDA ID).
For foreigners: A copy of a valid passport.
All directors (both Tanzanians and foreigners) are required to obtain a Taxpayer Identification Number (TIN) from the Tanzania Tax Authority (TRA). If the foreign director does not have a TIN, it is necessary to proceed with the registration.
Company Secretary Information: The appointment of a company secretary is mandatory, you need to provide the secretary’s details (name, address, identity documents) or business registration certificate if it is a legal entity.
Once BRELA has confirmed that your application is complete, accurate, and compliant with all legal regulations, the application will be approved. BRELA will issue a Certificate of Incorporation. This certificate will clearly state the company name, date of incorporation and company registration number. Usually, the Certificate of Incorporation will be issued in electronic form (PDF file) and you can download it directly from your account on the ORS system.
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