PART 1
     
PRELIMINARY 

1. This Act may be cited as the Tanzania Investment Act. 1997, and shall come into operation on the date which the Minister may, by notice  published in the Gazette, appoint. 

2. - (1) Subject to this Section, this Act shall apply to any business enterprise which meets the requirement specified in subsection (2) other than- 

 
(a) a business enterprise which is authorised to conduct reconnaisance, prospecting or mining opperations under the  Mining Act,1979,or is seeking authorization to conduct any 
such operations; 

  
(b)  a business enterprise which is authorized to conduct  exploration or production operations or to construct or  operate a pipeline under the Petroleum (Exploration and Production) Act,1980, or is seeking authorization to  conduct any such operation; 

  
(c)  a business enterprise which is engaged in the manufacture, marketing or distribution of harzadous chemicals, armaments or any type of explosives. 

     
(2) The businesses specification for the purpose of this section which may enjoy the benefits and protection provided under this act, are those which - 

  
(a) if wholly owned by a foreign investor or if a joint venture, the minimum investment capital is not less than Tanzanian shillings equivalent of US dollers three hundred thousand  (US$ 300,000); or 

  
(b) if locally owned, the minimum investment capital is not less than Tanzania shillings equivalent of US dollars one hundred  thousand (US$100,000). 

    
(3)  Notwithstanding the provisions of subsection (1) (a) and (b), the provisions of Section 21 which relates to guarantees of transfer of capital, profits and dividends and Section 22 which relates to the guarantees against expropriation, shall apply to any business enterprise which holds a mineral right granted under the Mining Act,1979, or a licence granted under the Petroleum (Exploration and Production) Act,1980, as though the holder has for the purpose of those provisions been granted a certificate of incentives and protection. 

    
(4)  Nothing in Section 22 relating to expropriation shall be read or construed as limiting or qualifying the right of the Minister or the Commissioner acting under and in accordance with the Petroleum (Exploration and Production) Act, 1980 or the Mining Act, 1979, to terminate a licence granted under those laws. 
 

    
(5)  Notwithstanding subsection (1),the Centre shall assist all investors, whether or not this Act applies to them to obtain necessary permits, authorizations, approvals, registrations, consents, licences and any other matter required by law for a person to set up and operate investment. 

3. In this Act, unless the context requires otherwise- 

"Board" means the Board of Directors of the Centre appointed under section 7; 

"benefits" includes facilities and inventives provided by or pursuant to this Act; 

"business enterprise" means any industry, project, undertaking or business to which this Act applies or an expansion,restructuring, rehabilitation or technical improvement of the industry, project, undertaking or business or any part of the business, provided that the business enterprise is profit motivated and operated on commercial principales; 

"capital" means all cash contribution, plant, machinery, equipment, buildings, spare parts, and other business assets other than goodwill which are not consumed in the regular operations of the business and have a life of more than twelve months; 

"Centre" means the Tanzania Investment Centre established by section 4; 

"certificate" means the certificate of incentives issued under section 17(1); 

"facilities" include licences, approvals and permits necessary for the establishment of a business enterprise which an investor may be obliged to obtain for the purposes of this Act; 

"foreign capital" means convertible currency, plant, machinery, equipment, spare parts, raw materials and other business assets other than goodwill that enters Tanzania with no initial disbursement of foreign exchange and are intended for the production of goods and services related to an enterprise to which this Act applies; 

"foreign investor" in the case of a natural person means a of a company, a company incorporated under the laws of person who is not a citizen of Tanzania, and in the case  any country other than Tanzania in which more than fifty percent of the shares are held by a person who is not a citizen on Tanzania,and in the case of partnership controlling interest is owned by a person who is not a citizen of Tanzania; 

"foreign loan" means a loan obtained from outside Tanzania dominated in any currency other than the Tanzanian currency; 

"inventives" means tax reliefs and concessional tax rates which maybe accessed by an investor under the Income Tax Act,1973, the Customs Tariff Act,1976, the Sales Tax Act, 1976 and any other law for the time being in force, and includes additional benefits that may be accessed by an investor under sections 19 and 20; 

"investment" means the creation or acquisition of new business assets and includes the expansion,restructring or rehabilitation of an existing business enterprise; 

"local investor" means a natural person who is a citizen of Tanzania; a Company incorporated under the laws of Tanzania in which the majority of the shares are held by a person who is a citizen of Tanzania; or a partnership in which the partnership controlling interest is owned by a person who is a citizen of Tanzania; 

"member" means a member of the Board of the Centre; 

"Minister" means the Minister responsible for investments; 

"technology transfer agreement" means an agreement relating to an enterprise to which this Act applies that involves- 

 
(i)   the assignment, sale or use of foreign patents, copyrights, trademarks or other industrial property rights; 

(ii)  the supply of foreign technical know-how or technological  knowledge; 

  
(iii) foreign technical assistance, design and engineering, consultancy or other technical services in any form they may be supplied; 
  
(iv)  foreign managerial, marketing or other services, except that an agreement shall not be regarded as a technology  transfer agreement for the purposes of this Act if its duration does not exceed a period of eighteen months. 
 

PART II

THE CENTRE AND ITS FUNCTIONS 

4.- (1)  There is hereby established a body to be known as the Tanzania Investment Centre. 

     
(2) The Centre shall be an Agency of the government and shall  be under the general supervision of the Minister. 

     
(3) The Centre shall be a body corporate with 0perpetual succession and a common seal and, shall in its own name be capable of- 

     
(a) acquiring and holding movable and immovable property, to dispose of property and to enter into any contract or other  transaction; 

     
(b) suing and being sued; and 

     
(c) doing and suffering all other acts and things which bodies corporate may lawfully do or suffer, for the proper  performance of its functions under this Act. 

5. The Centre, which shall be a one-stop centre for investors shall be the primary agency of Government to co-ordinate,encourage, promote and facilitate investment in Tanzania and to advise the Government on investment policy and related matters. 

6. For the purpose of section 5,the Centre shall- 

  
(a) initiate and support measures that will enhance the investment climate in the country for both local and foreign investors; 
 

(b) collect, collate,analyse and disseminate information about investment opportunities and sources of investment capital,  and advise investors upon request on the availability, choice or suitability of partners in joint venture projects; 

  
(c) in consultation with Government institutions and agencies identify investment sites,estates, or land together with  associated facilities of any sites, estates or land for the purposes of investors and investments in general; 

  
(d) assist all investors, including those who are not bound by the provisions of this Act, to obtain all necessary permits,  licences approvals consents, authorizations, registrations and  other matters required by law for a person to set up and operate  an investment; and to enable certificates issued by the Centre to have full effect. 

  
(e) Provide,develop,construct, alter, adapt, maintain and  administer investment sites, estates or land tegether with   associated facilities of those sites, estate, land and subject  to relevant law,  the creation and management of export  processing zones. 

  
(f) provide and disseminate up-to-date information on benefits or  incentives available to investors; 
  
(g) carry out and support local investment promotion activities which are necessary to encourage and facilitate increased  local investments, including entrepreneurial development  programmes; 

  
(h) perform any other functions which are incidental to the attainment of the objectives of this Act. 

7.- (1) There is hereby established a Board of the Centre which shall be responsible for the discharge of the functions of the Centre. 

    (2) The Board shall consist of- 

    (a) a Chairman who shall be appointed by the President; 
    (b) two members appointed by the Minister from the private sector; 
    (c) two members appointed by the Minister from the public sector; 
        and 
    (d) two other members appointed by the Minister. 

    (3) The Minister shall in appointing members pursuant to subsection (2), ensure that he appoints only persons with  sound knowledge and experience in public or private sector investment and management issues. 

    (4) The Executive Director shall be the Secretary of the Board. 

    (5) A member of the Board shall hold office for a term of three years and shall be eligible for re-appointment. 

    (6) A member of the Board appointed by the Minister may in  writing addressed to the Minister resign his office. 

    (7) Members of the Board shall be paid such allowances as the  Minister shall determine. 

    (8) The Board shall be ordinarily meet once every three months  and may meet in extraordinary session whenever necessary. 

8. Subject to the provisions of this Act, the Board shall determine its own procedure for convening and conducting its meetings. 

9. The Board may, for the discharge of the functions of the Centre, appoint Committees of the Board comprising of members of the Board or non-members or both and may assign to them any function which the Board may determine. 

10.   There shall be an Executive Director of the Centre who shall be appointed by the President upon recommendation by the Minister to serve- 

    (a) for a term of five years and may be rappointed  for a further non-renewable term of five years; 

    (b) on any other terms and conditions specified in the instrument  of his appointment or as the Board may determine. 

11.-(1) There shall be a Secretariat of the Centre which shall  consist of the  Executive Director and other officers and  staff of the Centre. 

    (2) There shall be established in the Centre any number of divisions, department or zonal offices with such number and  category of officers and staff as the Board may determine. 

    (3) The officers and staff of the Cetre shall be appointed by the Board as may be required for the performance of the  functions of the Secretariat of the Centre. 

    (4) The Board may delegate some of its powers under sub-section (3) to the Secretariat for the appointment of staff at any levels which it may determine. 

    (5) The officers and staff of the Centre shall be paid  remuneration or allowances which the Board may determine. 

    (6) Subject to any general directions which the Board may give,  the Executive Director shall be responsible for the day-to- day administration of the Centre and the implementation of  the decisions of the Board. 

    (7) Subject to this Act,the employees of the Investment Promotion  Centre (IPC) established under the National Investment  (Promotion and Protection)Act, 1990, who are immediately before the coming into operation of this Act employed by the  IPC, with effect from the coming into operation of this Act, be transferred to and be employed by the Centre. 

12. A member, officer or other staff of the Centre shall or in his personal capcity be liable in civil or criminal proceedings, in respect of any act or omission done in good faith in the exercise of his functions under this Act. 

13.-(1) The funds avaialble for the purpose of enabling the Centre to perform its functions under this Act shall consists of- 

    (a) money from time to time appropriated by  Parliament for that purpose; 

    (b) fees and charges levied under subsection (3) for the supply of goods and services to investors and other interested  parties in relation to its functions under this Act; 

    (c) any other monies received by or made available to the Centre  for the purpose of performing its functions under this Act. 

    (2) Without prejudice to the generally of the financial  provisions under this Act, the Centre shall establish a General Fund into which all money received by it shall be paid and out of which all payments required to be made by the Centre shall be effected. 

    (3) The Centre may, in the discharge of its functions and in  accordance with the terms and conditions on which the funds may bave been obtained and derived, charge the general Fund all remunerations, allowances, salaries, fees, pension fund  contributions, gratuities, working expenses or other charges properly arising including any approved capital expenditure. 

    (4) The Centre shall, not later than three months before the end of each financial year, prepare and submit to the Board for  its approval estimates of income and expenditure of the Centre for the next ensuing year and may, at any time before the end of a financial year, prepare and submit to  the Board for approval any estimates supplementary to the  estimates of a current year. 

    (5) Subject to any other direction of the Board no expenditure shall be made out of funds of the Centre unless that  expenditure is part of the expenditure approved by the Board   under the estimates for the financial year in which that  expenditure is to be made or in the estimates supplementary to it. 

    (6) The Centre may, with the approval of the Board, invest as it  considers fit any monies not required for immediate use. 

14.-(1) The financial year of the Centre shall be the same as the  financial year of the Government. 

    (2) The accounts of the Centre shall be prepared in accordance  with approved accounting standards and shall be audited by  the Controller and auditor General within three months after  the close of the financial year. 

    (3) As soon as  the accounts of the Centre have been audited and   in any case not later than four months after the close of the  financial year, the Board shall submit to the Minister a copy of the audited statements of accounts together with a copy of   the report, made by the auditor on the statement of accounts. 

    (4) The Centre shall, within five months after the close of the  financial year, cause to be prepared and submitted to the  Minister a report dealing generally with the activities and  operation of the Centre during that year and accompanied by-
 
    (a) a copy of the audited accounts of the Centre; 
    (b) a copy of the auditors report on the accounts; and 
    (c)   any other information which the Minister may direct. 

    (5) The Minister shall within not more than three months, after  receiving the accounts and repports, lay them before the  National Assembly. 

PART III  

PROVISIONS RELATING TO INVESTMENT 

15. The Centre shall, in liaison with relevant Ministries and other  authorities, determine investment opportunities available in the  country and the odalities of accessing them. 

16.-(1) For the purposes of making the Centre an effective one stop  Centre, all Government departments, Government agencies and  other public authorities shall co-operate fully with the Centre in the performance of its functions under this Act. 

    (2) Notwithstanding the generally of sub-section (1), where  licences or approvals are required by an investor, the   Centre shall liaise in writing with the relevant authorities to secure the necessary licences and approvals as required   by the investor. 

   (3)  The relevant authority which receives the request under sub-section (2) shall within fourteen working days of   receipt of the request, issue the required licence or  approval or serve a written objection to the Centre. 

  (4) Where the Centre does not receive a written objection from  the relevant authority within the specified time under   sub-section (3) the necessary licence or approval shall be  deemed to have been granted. 

    (5) Where the Centre receives any written objection from the   relevant authority within the specified time under   sub-section (3),it shall, where it does not agree with the objection, communicate the objection, within seven days of  its receipt, together with its own recommendation to the  Minister for his decision. 

    (6) The Minister shall within seven days of receipt of the  objection, and the Centre's recommendation, notify the  Centre and the relevant authority of his decision and the   Centre shall immediately communicate that decision to the  investor. 

    (7) Any person aggrieved by the decision made pursuant to the   provision of subsection (5) and (6), may appeal to the  Minister. 

    (8) The Minister may, on the advice of the Board in writing request the relevant Minister to station at the offices of the Centre any public officers who may be specified and that request shall be complied with. 

17.-(1) All applications for certificates of incentives and  protection under this Act,shall be made to the Centre and the  Centre shall, issue certificates in accordance with the provisions  of this section. 

    (2) Where an application is for new investment, it shall contain- 
 
(a) the name and address for the proposed business enterprises,its legal form, its bankers, the name and address of each  director or partner and the name; address, nationality and  shareholding of each share holder; 

 
(b) the qualifications,experience and other relevant particulars of the project management; 

 
(c) the nature of the proposed business activity and the proposed   location where that activity is to be carried on; 

 
(d) the proposed capital structure or the amount of investment   and the projected growth over the next five years; 

    (e) how the investment will be financed; 

    (f) evidence of sufficient capital available for investment; 

    (g) an undertaking that the project shall be implemented as indicated in the projections of the project. 

    (3) Where an application is to rehabilitate or expand an existing  enterprise or both, it shall contain: 

    (a) the name of the existing enterprise,its Articles of  Association and Memorandum of Association or partnership   agreement; 

    (b) the qualifications of the project management; 

    (c) a statement of audited accounts for the three previous years; 

    (d) the nature of rehabilitation or expansion; 

    (e) the capital structure and projected growth over the next   five years; 

    (f) financing of the rehabilitation or expansion project,   together with evidence of availability of finances; 

    (g) an undertaking that the expansion or rehabilitation shall be  implemented as indicated in the projection. 

    (4) Where the application is for equity investment, shares or  stock in an enterprise, it shall contain- 
 
(a) the name of the enterprise in which the equity investment, is made or the shares held; 
 
(b) constitution of the enterprise or partnership agreement; 
 
c) the amount of equity investment made; 
 
(d) the number of shares or stock held by the equity investor, and 
   
(e) the currency in which the equity investment is made. 
 
(5) The Board shall determine the procedure of application, and   the manner in which certificates of incentive shall be  issued and registered and shall cause that determination to   be known to the potential investor and the public in general. 
 
(6) The Board shall cause to be maintained a register of all   certified business enterprices containing  such particulars  as the Board may determine. 
 
(7) A certificate of incentives shall not be transferred, or  assigned or amended without the approval of the Centre. 
 
(8) Where a holder of a Certificate does not commence  operations within the first two years of issuance of a  certificate without satisfacory reasons, the centre may,  subject to the rights of innocent third parties, declare  anything done or any benefit obtained under the certificate  to be void and notify the holder of the centificate  accordingly. 

 
(9) Where the holder of a certificate ceases, for any reason to   operate the investment to which the certificate relates, he  shall notify the Centre in writting and he shall be entitled  to all rights and be liable to all obligations incured under    this Act up to the date he ceased to operate and on that date  his certificate shall be deemed to have expired. 
 

(10) A holder of a certificate shall inform the Centre in writing   of the date of commencement of investment and the Centre shall forthwith verify the commencement of operations. 
 
(11) A holder of a certificate shall inform the Centre in  writing when- 

 
(a)  a person other than the person to whom the certificate was  issued has succeeded to the investment; 
 
(b)  the name or description of the business or enterprise is  changed; or 
 
(c)  there is an enlargement of or substantial variation in the  investment. 

 
(12) Notwithstanding the provisions of subsection (7), person other than the holder of a certificate who is affected by  or is interested in a change or variation under subsection (8),may so inform the Centre if the holder of a certificate fails to inform the Centre within a reasonable time. 

 
(13) Where the Centre is satisfied that a change or variation   has occured as provided in subsection (8) in respect of a  certificate issued under this Act, the Centre shall amend the certificate to take into account the change or variation. 

18.-(1) The centre shall co-ordinate the establishment of business  enterprise to which this Act applies including- 
 
(a) incorporation or registration of business enterprises under  the Companies Ordinance or under any other laws which are   relevant to the establishment of enterprises; 
 
(b)  the filling of Value Added Tax Forms; 

 
(c)  the filling of investment Registration Forms as the Centre may from time to time prescribe; 

 
(d)  facilitating the obtaining by investors of the necessary  licences, approvals, facilities or services; 

 
(e)  the filling of Immigration Forms. 

 
(2)  On submission of an application for the incorporation or registration of an enterprise under subsection (1)mof this   section, the officers responsible for the incorporation and registration shall, where the documents of the applicat are  in order, complete the processing of the application and   issue the requisite certificate to the applicant within a period not exceeding fourteen working days from the date of the submission of the appplication. 

19.-(1) A business enterprise in respect of which a certificate is granted under this Act shall be entitled to the benefits  which are applicable to that enterprise under the provisions   of the Income Tax Act, 1973, the Customs Tariff Act 1976,  the Sales Tax Act,1976, or of any other written law for the   time being in force. 

 
(2) For the purposes of creating a predictable investment   climate, the benefits referred to under sub-section   (1) shall not be amended or modified to the detriment of the   investors enjoying those benefits. 

20.-(1) For the purposes of promoting identified strategic or major   investments, the Minister, may, by order published in the   Gazette, and after consultation with appropriate government   authorities and after consultation with the Minister of   Finance, specific in addition to the benefis provided under  section 19 of this Act for any period which the Board may  specify. 

 
(2) Where the Ministers do not agree on any issue or matter in  accordance with the provisions subsection (1); the Minister   shall within one month from the date of the consultations  referred to in subsection (1), submit the matter to the  President for consideration. 

21. Subject to this section,a business enterprise to which this Act  applies shall be guarnteed unconditional transferability through any  authorised dealer bank in freely convertiable currency of- 

 
(a) net profits or dividends attributable to the investment; 
 
(b) payments in respect of loan servicing where a foreign loan has been obtained; 
 
(c) royalties, fees and charges in respect of any technology transfer agreement registered under this Act; 
 
(d) the remittance of rpceeds (net of all taxes and other obligations) in the event of sale or liquidation of the   business enterprise or any interest attributable to the investment; 
 
(e) payments of emoluments and other benefits to foreign personnel employed in Tanzania in connection with the  business enterprise. 

22.-(1) Subject to subsection (2)and(3)of this section- 
 
(a) no business enterprise shall be nationalised or expropriated 
by the Government, and 
 
(b) no person who owns,whether wholly or in par, the capital of  any business enterprise shall be compelled by law to cede his  interest in the capital to any other person. 

 
(2) There shall not be any acquisition, whether wholly or in part   of a business enterprise to which this Act applies by the  State unless the acquisition is under the due process of law  which makes provision for- 

 
(a) payment of fair adequate and prompt compensation, and 
 
(b) a right of access to the Court or a right to arbitration for  the determination of the investor's interest or right and  the amount of compensation to which he is entitled. 

 
(3) Any compensation payable under this section shall be paid   promptly and authorisation for its repatriation in   convertiable currency, where applicable, shall be issued. 

23.-(1) Where a dispute arise between a foreign investor and the  Centre or the Government in respect of a business enterprise, all  efforts shall be made to settle the dispute through negotiations  for an amicable settlement. 

 
(2) A dispute between a foreign investor and the Centre or the  Government in respect of a business enterprise which is not  settled through negotiations may be submitted to arbitration  in accordance with any of the following methods as may be  mutually agreed by the parties,that is to say- 

 
(a) in accordance with arbitration laws of Tanzania of investors; 

 
(b) In accordance with the rules of procedure for arbitration of the International Centre for the Settlement of Investment Disputes; 
 
(c) within the framework of any bilateral or multilateral agreement on investment protection agreed to by the   Government of the United Republic and the Government of the  Country the Investor originates. 

24.-(1) Every business enterprise granted a certificate of   incentives under this Act, shall be entitled to an initial  automatic immigrant quota of up to five persons during the  start up period. 

 
(2) Subject to subsection (1).any application for an extra  person within an immigrant quota shall be submitted to the   Centre which shall, in consulation with the Immigration Department,authorise any additional person which it shall  deem necessary taking to consideration the availability of  qualified Tanzanians, complexity of the Technology employed  by the business enterprise and agreements reached with the investors. 
 

25.-(1) Subject to section 2, a foreign investor may, in relation  to the business enterprise which he operates, obtain credit  from domestic bank and financial institution up to the limit   established by the Bank of Tanzania in consulation with the  Centre having regard to the amount of foreign capital  invested in the business enterprise. 

 
(2) A foreign investor who obtains credit in accordance with  subsection (1) shall ensure that the proceeds of that credit  are used solely for the purpose of carrying out the activities specified in his loan application. 

 
(3) The bank granting the loan may, for the purposes of this  section, appoint its officer or agent to verify the due  application of the credit obtained under subsection (1). 

26.-(1) A person who has established an enterprise may enter into such technology transfer agreement as he considers appropriate for his enterprise. 

 
(2) Every agreement for the transfer of foreign technology or  expertise shall be registered with the Centre by the  benificiary of that transfer as soon as it is made and it   shall not be effected unless it has been registered. 

 
(3)   A person who applies for a Certificate which involves an agreement for the transfer of foreign technology or  expertise, shall not be required to make a separate   application under this Act if he provides the relevant information relating to the regulation of agreements for   the transfer technology or expertise required under this  Part. 

 
(4) The Executive Director shall maintain a register in which  shall be recorded all agreements for the transfer of foreign  technology or expertise which is included in the certificate. 

PART IV  

GENERAL PROVISIONS 

27.-(1) A person who in the course of his official duties in the  administration of this Act has possession of or control  over any document or information obtained under this Act  and who communicates that document or information or any  part of it to any other person to whom he is not authorised  to communicate it by any enactment or by the Board, commits  an offence and is liable on conviction to a fine not  exceeding three hundred and fifty thousand shillings or to  imprisonment for a term not exceeding one year or to both the fine and imprisonment. 

 
(2) A public officer who has a duty to perform under this Act  and fails to perform that duty or performs the duty  recklessly shall be liable to the disciplinary action which  the Board or the appropriate disciplinary authority may   determine. 

    (3) A person who- 
 
(a) knowingly or negligently gives false or misleading  information; 
 
(b) refuses or neglects to provide information which the Centre   may reasonably require for the purposes of the enforcement of this Act; or 
 
(c) refuses without lawful excuse to admit an officer or an  agent of the centre into the premises of his business  enterprise or otherwise obstructs any inspection by an officer or agent of the Centre in pursuit of its monitoring fuction, commits an offence and on conviction is liable to  a fine not exceeding one million shillings or to imprisonment  for a term not exceeding twelve months or to both the fine  and imprisonment. 

 
(4) Where an offence is committed by a body of person then- 

 
(a) in the case of a body corporate other than a partnership,every director, senior management officer or responsible  officer of the body shall be deemed also to have committed  that offence; and 

 
(b) in the case of partnership, every partner, senior management officer or responsible officer of that body shall be deemed also to have committed that offence. 

 28. A document may be served on the Centre by delivering it to the  office of the Centre or by sending it by registered post adressed  to the Executive Director. 

29. The Minister may, after consulation and advice of the Board,  make regulations for giving effect the provisions of this Act. 

30. The National Investment (Promotion and Protection) Act, 1990 is  hereby repealed. 

31.-(1) Notwithstanding the repeal of the National Investment (Promotion and Protection Act,1990, on the coming into operation of this Act, a certificate of approval issued by  the Investment Promotion Centre and which immediately before  the commencement of this Act, continue to be valid on the  terms and conditions on which it was issued as if it were a   certificate of incentives issued under this Act, and shall   be so valid- 
 
(a) until the exppiration of the term under which its holder was  entitled to enjoy any benefit, incentives or protection; or 
 
(b) up to five years from the date of commencement of this Act, if on the coming into operation of this Act, the holder has  not utilized bad benefit, incentive or protection and on expiration of the period specified in paragraphs (a) and (b),  the provisions of this Act shall commence to apply to the business  enterprise. 

 
(2) Subject to subsection (1),a person holding a certificate of   approval in accordance with the terms and conditions of the  National Investment (Promotion and Protection) Act, 1990, shall not claim any benefit, protection or incentive under  this act until after the expiration of the period specified  in subsection (1) or unless the Board determines otherwise. 

 
(3) The Minister shall before the commencement of this Act, cause to be recorded for the purposes of identification,  all business enterprises which are entitled by virtue of the enactment of this act,to carry on business on the terms  and conditions of benefits and incentives under the certificate of approval issued by the Investment Promotion  Centre established under the National Investment Promotion  Centre established under the National Investment (promotion   and Protection) Act, 1990. 
 

(4) Any application pending before the Tanzania Investment   Prmotion Centre established under the National Investment  (Promotion and Protection)Act,1990, shall be deemed to be    pending before the Centre established under this Act. 

 
(5) Any agreement continued in force by virtue of this section  shall confer benefits previously enjoyed under the  agreement before the commencement of this Act and also any other benefits which may be applicable to the enterprise under this act which the Board may determine. 

 
(6) Where a business enterprise in existence immediately before  the commencement of this Act has duly complied with the National Investment  (Promotion and Protection) Act, 1990 in relation to any minimum equity requirement or capital  investment specified in that Act, the enterprise shall be  deemed lawful notwithstanding any provision of this Act to the contrary. 
 
(7) All immigrant quota in existence immediately before the   coming into force of this Act in respect of an enterprise  to which this Act is applies shall continue in force until  expiration or unless renewed under this Act. 

 
(8) All technology transfer agreements registered with the   Centre shall be deemed to be registered with the relevant authority referred to under this Act
 
 

FINANCIAL LAWS (miscellaneous amendment)Act, 1997

ENACTED by the Parliament of the United Republic of Tanzania. 

PART I  

PRELIMINARY PROVISIONS 

1.  This Act may be cited as the Financial Laws (miscellaneous  Amenedment) Act,1997. 

2.  This act shall come into operation on the date which the  Minister may, by Notice published in Gazette, appoint. 

PART II  

AMENDMENT OF THE INCOME TAX ACT:1973 

3.  This Part shall be read as one with the income Tax Act. 1973  hereinafter referred to as "the principal Act." 

4.  The principal Act is amended in subsection (2) of section  2 which relates to definition by inserting the following new  definitions in their respective alphabetical order of 
arrangement- 

"mineral" means any substance, whether in solid, liquid or gaseous  form, occurring naturally in or on the earth, or in or under the  seaded, formed by or subject to a geological process, but does not  include petroleum as defined in the Petroleum (Exploration and  Production) Act of 1980, or water; 

"mining"means intentionally winning minerals and includes every  method or process by which mineral is won; 

"mining operations" means prospection, mining or operations  connected with prospecting or mining carried out pursuant to right  granted under the Mining Act,1979; 

"prospect" means to search for any mineral by any means and to  carry out any such works and remove any such samples as may be  necessary to test the mineral bearing qualities of land and  includes reconnaissance operations as defined in the Mining  Act,1979; 

"technical services" in respect of mining operations, means  services in respect of earthmoving,engineering, construction, and  includes geological,geotechnical and metallurgical services or any  other like services. 

5.  The Principal Act is amended in section 10- 

  (a)   by deleting the words "or professional fee"which appear in  paragraph (a); 
 
  (a)   by inserting immediately after paragraph (a) the following   new paragraph- 

          "(b) any professional fee not being a fee for the provision of technical services;" 

  (c)   by renumbering paragraphs (b),(c),(d) and (e) as paragraphs (c);(d);(e);and (f); 

  (d)   by inserting after the new paragraph (f) the following new  paragraph-  "(g) the provision of technical services" 

6.    Section 16 is amended- 

  (a)   by deleting paragraph (1) of subsection (2) and substituting  for it the following new paragraph- 

  "(1)  such amount in relation to mining operations which during the year of income has been- 

    (i) expended;or 
   (ii) in a manner approved by the Commissioner, was used in order   to provide funds at a future date to defray expenses, in  connection with remedying, to the satisfaction of Minister  responsible for minerals, upon cessation of mining  operations, any damage caused by such mining operations to  the surface of, and the environment on, the land in question: 

Provided that any amount provided for under subparagraph (ii) which  is not used for the purpose specified herein, shall be included in  the income of such person in the year of income following the year  of income within which that person ceases to carry on mining  operations, but if the amount so provided or any part of it is at  any time, before the cessation of mining operations, utilized for  any purpose other than the purpose specified therein, the amount  so utilized shall be included in the income of that person in the  year income within which the amount is so utilized;" 

  (b)   by deleting sub-section (4) and substituting for it the  following- 

        "(4) Subject to paragraph(b)of this sub-section- 

  (a)   where the ascertainment of the total income of any personresults in a deficit for any year of income, the amount of    such deficit shall be an allowable deduction in ascertaining the total income of such person for the next succeeding year    of income; and 

  (b)   where such deficit arises in whole or in part in respect of   ascertainment of income derived from mining operations the  amount of such deficit which so arises shall not be allowable  as a deduction for such person in respect of income other   than income derived from mining operations and no deficit  arising in respect of any other business carried on by that person shall be allowable as a deduction in respect of  income derived from mining operations". 

7.    Section 17 of the principal Act is amended by adding the  following new paragraph immediately after paragraph (i)- 

"(i)  any expenditure incurred in the provision of technical  services to a person carrying on mining operations where, in respect  of the payment for such technical services, tax has been charged by  withholding from the gross amount of such payment pursuant to  subsection (3B) of section 33." 

8.    Section 33 is amended- 

  (a) in sub-section (2) by delecting the phrase "or professional fee" which appear in paragraph (i); 

  (b) by inserting immediately after paragraph (i) the following new  paragraph- 

      "(ii)any professional fee which is not a fee for the provision   of technical services;" 

  (c) by renumbering paragraph (ii),(iii),(iv),(v),(vi),(vii), and (viii)as praragraphs (iii),(iv),(v),(vi,(vii),(viii) and (ix)   respectively; 

  (d) by inserting immediately after the renumbered paragraph  (ix) the following new paragraph: "(x)any fee for the provision of technical services to a  person carrying on mining operations." 

  (e) in subsection (2A) by inserting immediately after the words  "interest or rent" the following phrase- 

      "or payment for technical services provided to a person   carrying on mining operations." 
 
  (f) by adding immediately after subsection (3A) the following new  subsection- 

"(3B) Tax on any payment for technical services provided to a  person carrying on mining operations to which subsection (2) (a) (i)of section 33 applies shall be charged for any  year of income at a rate of three percent of the gross amount   and shall not be subject of tax under the provisions of  subsection (1) of this section." 

9.  Section 34 is amended- 

  (a  in sub-section (1) by deleting the phrase "or professional  fee" which appears in paragraph (a); 

  (b) by inserting immediately after paragraph (a) the following  new paragraph- 

      "(b) any professional fee which is not a fee for the provision  of technical services"; 

  (c) by renumbering paragraphs (b),(c),(d),(e),(f),(g) and (h) as  paragrapha (c),(d),(e),(f),(h),and(i); 
 
  (d) by adding immediately after the renumbered paragraph (a) the following new Paragraph- 

 
"(b)any pprofessional fee which is not a fee for the provisionof technical services"; 
 

(e) in subsection (2) by adding the following new paragraph  immediately after pargraph (e)- 

 
"(f)technical services to any person carrying on mining operations." 

10. Section 61 of the principal Act is amended by adding the  following new sub-section immediately after sub-section (3)- 

  "(4) A person carrying on mining operations shall maintain separate accounts and record in respect of such mining   operations: 

Provided that- 

  (a)  a person carrying on mining operations may elect by notice   in writing to the Commissioner given not later that the end   of the year of income in which such mining operations  commence to maintain and denominate such accounts and records   in United States Dollars and such election shall be  irrevocable; and. 

  (b)  where a person has so elected, income accrued or expenditure incurred in Tanzania shillings or in foreign currency other  than United States Dollars shall be entered in such accounts   and records in United States Dollares in amounts calculated   at the midpoint between the buying and selling rate of   exchange between Tanzania shilling or, as the case may be, foreign currencv other than United States Dollars and United   States Dollars quoted by Bank of Tanzania on the date such  income accrues or expenditure is incurred, or such other rate  of exchange as may be approved by Commissioner; and 

  (c)  where a person has so elected, payment of any amount of tax assessed and denominated in United States Dollars shall be  made on the due date in Tanzania shillings in an amount   equivalent to such amount of United States Dollars when  converted at the buying rate for United States Dollars   quoted by the Bank of Tanzania for transactions in like  amounts upon such due date, unless by notice in writing to  such person given not less than one month prior to the due  date of any payment of tax assessed, the Commissioner  determines that such payment shall be made in United States  Dollars." 

  11.  The principal Act  is further amended by repealing Part III   of the Second Schedule and replacing it with the following:-

PART III  

DEDUCTIONS IN RESPECT OF MINING OPERATIONS 

16.-(1)In this Part unless the context requires otherwise-  "additonal capital allowance" has the meaning ascribed to it  in paragraph 18 of this Schedule; 
 
"allowance base" has the meaning ascribed to it in paragraph  18 of this Schedule; 
 
"development capital expenditure" means capital expenditure   incurred wholly and exclusively for the purpose of development   operations. 

 
"development operations" means operations carred out for or  in connection with the development of a mine and includes  operations to add to, alter or improve an existing mine. 
 
"expenditure" means the sum of prospecting capital expenditure and development capital expenditure, incurred in  the United Republic of Tanzania by any person carrying on   mining operations and any amount of additional capital allowance computed for the year of income in accordance   with the provisions of paragraph 18 of this schedule: 

       Provided that the expression "expenditure" shall not include- 

  (ii) any expenditure on the acquisition of the site of deposits of  minerals or the site of buildings of works, or of right in or  over any such site; 

  (ii) any expenditure on works constructed wholly or mainly for  subjecting raw products of such deposits to any process  except a process designed for preparing the raw product for   use as such;  

 
"mine" when used as a noun,means any place, excavation or   working in or on which any operation connected with mining  is carried on together with all buildings, premises,   erections and appliances belonging or appertaining thereto, above or below the ground for the purposes of mining,  treating or preparing minerals,obtaining or extracting any  mineral or metal by any mode or method or for the purpose of   dressing mineral ores; 
 
"prospecting capital expenditure" means capital expenditure   incurred wholly and exclusively for the the purpose of   prospecting and includes expenditure incurred in the acquisition of rights in or over deposits or minerals; 

 
"qualifying capital expenditure" has the meaning ascribed to   it is paragraph 18 of this Schedule. 

(2)    Any reference in this part to assets representing anyexpenditure includes, in relation to prospecting capital expenditure any results obtained from any search, exploration   or inquiry upon which the expenditure was incurred. 

17. Subject to this Schedule,where a person carrying on mining  operations incurred expenditure in any year of income there shall  be made, in computing his gains or profits for such year of income,  a deduction equal to the amount of such expenditure. 

18.-(1)For the purpose of deduction of development capital  expenditure in ascertaining the income of a person  derived from mining operations, an additonal capital  allowance of fifteen per centum per annum shall be  applied to the balance of unredeemed qualifying capital   expenditure forming part of any deficit brought forward and allowable as a deduction for such person at the commencement   of each year of income. 

  (2)  "Qualifying capital expenditure" for the purpose of the additional capital allowances shall mean development capital expenditure and shall not include prospecting capital  expenditure or any interest or financing charges. 

  (3)  The accumulated qualifying capital expenditure in relation   to a mine at the end of a year of income for the purpose of  application of the additional capital allowance that is, the  "allowance base" which is the sum of- 

  (a)  unredeemed qualifying capital expenditure brought forward from the year preceding the year  of income; 

  (b)  plus the additional capital allowance calculated thereon; 

  (c)  plus qualifying capital expenditure incurred during the year  of income; 

  (d)  minus my such qualifying capital expenditure set off against the the income of another mine; 

  (e)  minus gains or profits chargeable to tax in relation to such  mine for the year of income calculated before any deduction in  respect of qualifying capital expenditure and including and  proceeds of disposals of assets previously included as  qualifying capital expenditure. 

  (4)  Where at the end of any year of income the allowance base becomes negative the unredeemed qualifying capital  expenditure carried forward to the subsequent year of income   shall be set at zero. 

  (5)  Where unredee