Investment Code Act, 2019

Section Interpretation Section In this Code, unless the context otherwise requires— " Authority " means the Uganda Investment Authority; " Board " means the Board of the Authority established under section 4 ; " business enterprise " includes a manufacturing enterprise, a tourist enterprise, a commercial or agricultural venture and a service enterprise; " currency point " has the value assigned to it in Schedule 1; " Director General " means the Director General appointed under section 6 ; " facilitation " means rendering support services and approval necessary for the establishment of a business enterprise ; " foreign capital " means convertible currency, plant, machinery, equipment, spare parts, intellectual property and other business assets, other than goodwill, that enter Uganda with no initial disbursement of Uganda’s foreign capital intended for the production of goods and services related to a business enterprise to which this Act is applicable; " foreign investor " means— (a) a natural person, who is not a citizen of an East African Community Partner State; (b) a company incorporated under the laws of any country other than that of an East African Community Partner State;...

Section Functions and powers of the Authority Section For the attainment of the objects of the Authority , the Authority shall be a one stop centre with the following functions— to promote, attract, facilitate, register, monitor and evaluate all forms of investments and business activities in Uganda; to receive all applications for investment certificates for investors intending to establish or set up business enterprises in Uganda under this Code; to facilitate investors to secure licences, authorisations, approvals and permits required to enable any certificates granted by the Authority to have full effect; to undertake research and report on investment activities in Uganda; to acquire, develop and manage serviced land for investment ; to provide information on matters relating to investment activities in Uganda; to assist potential investors in identifying and establishing investment projects in Uganda; to propose and advocate policies and measures that will enhance investment in Uganda; to undertake annual evaluations of the progress and state of investment in the country; to maintain a register of all investment licences issued under this Act; to establish and maintain investm...

Section Cooperation with other agencies Section The government ministries, departments and agencies referred to under subsection (1) include— Government ministries, departments and agencies performing functions relating to registration, licensing and approval of establishing an investment in Uganda shall cooperate with the Authority . the Uganda Registration Services Bureau; the Uganda Revenue Authority ; the National Environment Management Authority ; the Uganda National Bureau of Standards; the Directorate of Citizenship and Immigration; the Directorate of Lands Registration; the Kampala Capital City Authority and local governments; the National Identification and Registration Authority ; the Uganda Free Zones Authority ; the National Social Security Fund; and any other ministry, department or agency specified by the Minister by Notice in the Gazette . The government ministries, departments and agencies referred to in subsection (2) shall, for purposes of this section, sign agreements with the Authority that will define the service commitments and maximum delivery time lines for the services they offer to investors.

Section Qualification for incentives Section An investor who, in addition to the qualifications for incentives set out in any other law, meets the following qualifications for incentives and commences operations after the commencement of this Act, qualifies for incentives— meets the minimum investment capital for the investment as required in the relevant Acts of Parliament; engages in any of the priority areas specified in Schedule 2 to this Act; exports a minimum of eighty percent of the goods produced; provides for substitution of thirty percent of the value of imported products; seventy percent of the raw materials used are sourced locally; directly employs a minimum of sixty percent of citizens; or introduces advanced technology or upgrading of indigenous technology.

Section Certificate of incentives Section The certificate shall— An investor who has been given an incentive shall receive a certificate of incentives issued by the Authority . state under what law the investor has been given the incentive; and give detailed particulars of the incentives given.

Section Meetings of the Board Section Schedule 3 shall have effect in relation to the meetings of the Board . The Minister may, by statutory instrument, amend Schedule 3.

Section Continuation of Uganda Investment Authority Section The Authority shall be a body corporate with perpetual succession and a common seal and, in its own name, capable of— The body known as the Uganda Investment Authority and existing immediately before the commencement of this Act under the Investment Code Act shall continue in existence by the same name and shall be subject to the provisions of this Act. The Authority shall be an agency of the Government and shall be under the general supervision of the Minister . acquiring and holding property; suing and being sued; and doing and suffering all acts and things as bodies corporate may lawfully do or suffer.

Section Objects of the Authority Section The objects of the Authority are to— The Authority shall be responsible for coordinating, encouraging, promoting and facilitating investment in Uganda; and advising Government on investment policy and related matters. promote, attract, advocate, facilitate, register, monitor and evaluate the development of all forms of investment and business activities in Uganda; promote and encourage investment in new technologies, skills upgrading, automation, training, research and product development; establish and manage a one stop centre ; publish and avail periodical reports on the state of investment in the country; assess for matters of incentives and utilization of local resources and services by the investments; and do any other act conducive or incidental to the foregoing;

Section The Board Section The Board shall consist of the following— The governing body of the Authority shall be a Board . The Board shall be responsible for the attainment of the objects of the Authority and the discharge of the business and functions of the Authority . five persons appointed by the Minister from the private sector with sound knowledge and practical experience in business or investment matters; one of whom shall be the chairperson; the Permanent Secretary of the Ministry responsible for finance or his or her nominee not below the rank of Commissioner; and the Permanent Secretary of the Ministry responsible for trade, or his or her nominee, not below the rank of Commissioner. The members of the Board shall hold office for not more than three years and shall be eligible for re-appointment for one further term only. A member of the Board shall be paid such allowances, as the Minister shall determine.

Section Removal of a member of the board Section A member of the Board may be removed by the Minister where— A member of the Board may, in writing addressed to the Minister , resign his or her office. the member is absent without reasonable excuse from three consecutive meetings of the Board of which he or she has had notice; the member is adjudged bankrupt by a court of law; the member fails, omits or neglects to carry out his or her responsibilities as a Board member ; the member is convicted of an offence involving dishonesty, fraud or moral turpitude; the member is incapacitated by reason of prolonged physical or mental illness from performing his or her duties as a member ; or the member is otherwise unable or unfit to discharge the functions of his or her office. Where a member of the Board resigns, dies, is removed from office, ceases to be a member of the institution or body which he or she represents on the Board , the chairperson shall notify the Minister of the vacancy and the Minister shall appoint another person to hold the office within a period not exceeding sixty days. A member of the Board appointed under subsection (3) shall hold office for not more than three yea...

Section Committees of the Board Section The Board may, in the discharge of the objects and functions of the Authority , appoint committees of the Board comprising members and other competent persons and may assign to them such matters concerning the functions of the Board as it considers fit and with such restrictions as the Board may specify. The Board may dissolve any committee appointed under subsection (1). Subject to any direction given by the Board , a committee may regulate its own procedure.

Section Secretariat Section The secretary shall— The Authority shall have a Secretariat consisting of a Director General and other officers and staff of the Authority . There shall be appointed to the service of the Authority a Director General , other officers and staff as may be required for the performance of the functions of the Secretariat of the Authority , and all persons appointed under this section shall hold public office. The Director General shall be appointed by the Minister on the recommendation of the Board . The Director General shall hold office for five years and is eligible for reappointment for one further term only. The Director General shall, subject to the directions of the Board on matters of policy, attend Board meetings and be responsible for the day to day carrying out of the decisions of the Board , the supervision of the Secretariat and for the control of the staff of the Authority . The Authority shall have a secretary to be appointed by the Board on such terms and conditions as may be specified in the instrument of appointment. act as secretary to the Board and shall record the minutes of all proceedings of the Board ; keep the minutes and other recor...

Section Removal or suspension of Director General from office Section The Minister shall on recommendation of the Board , remove the Director General from office for— The Minister shall on recommendation of the Board , suspend the Director General from office, pending the determination of any enquiry as to the existence of any of the grounds in subsection (2). misconduct; incapacity; or incompetence.

Section Remuneration of Director General and staff of the Authority Section The Director General , the officers and the other staff of the Authority shall be paid such remuneration or allowances as the Board may, with the approval of the Minister , determine.

Section Minimum investment capital requirements for investment registration Section The Minister shall by statutory instrument, state the minimum investment capital proposed for a domestic and a foreign investor to qualify for registration and issuance of an investment licence by the Authority under this Act. Notwithstanding subsection (1), the minimum threshold for portfolio investment for domestic and foreign investors shall be governed by the laws of Uganda.

Section Investment registration Section An investor who satisfies the minimum investment capital, shall apply to the Authority for registration for the purposes of being facilitated and promoted under this Act. The Authority shall issue to an investor an investment certificate in respect of a registration made under subsection (1).

Section Investment registration requirements Section An application for investment registration shall be accompanied by the following— business plan which shall include— certificate of registration of the business; the name of the investment and detailed information on the type of investment ; the action plan; the date of commencement of operations; detailed information on raw materials sourced in the country or in the locality where the investment is to operate; detailed information on any financing and assets to be sourced from outside Uganda, including the timeframe in which these finances and assets shall be invested; land requirement for the investment ; the location of the investment ; utilities required for the investment ; a market survey; details of the projected technology; and knowledge transfer. the environmental impact assessment certificate issued in accordance with the relevant laws; the projected number of employees; and licence granted by the business sector in which the investor intends to operate.

Section Obligations of a registered investor Section A registered investor shall— observe and adhere to the laws of Uganda; implement the proposal in accordance with the business plan submitted in the application for an investment licence; properly keep financial and accounting records of the investment and submit a copy of a certified financial report to the Board within three months following the preceding financial year; keep data relating to operations of the investment enterprise for a period of seven years; respond in a period prescribed by written notice to any query from the Board in connection with operations of the investment enterprise; periodically avail the books of accounts to the body responsible for taxation; register with the tax administration and file timely tax returns even in case of entitlement to tax exemption; permit the Authority or its employees or agents reasonable access to monitor the operations of the business enterprise .

Section Foreign investment Section A foreign investor shall not invest and participate in the operation of any investment activity in Uganda before registration with the Authority . The Minister may, by statutory instrument and with the approval of the Cabinet, specify an investment activity that may not be available for participation by foreign investors. A person who contravenes subsection (1), commits an offence and is liable, on conviction, to a fine not exceeding one thousand currency points or imprisonment not exceeding four years or both.

Section Investment in scarce resources Section Where only a limited number of investors can be allowed to exploit a scarce resource, the Authority shall work closely with the government line ministries and relevant organisations to ascertain— Investment in scarce resources may be permitted in accordance with the relevant laws of Uganda for the time being in force relating to such resources. the location and nature of the opportunities; the number of business enterprises which can be registered to exploit the scarce resource in an optimal manner; the conditions to be imposed on an investor who is operating at a given location; including the protection of the environment; and the mechanisms to be used by the Authority in selecting the investor for each available opportunity.

Section Application for investment certificate Section An application for an investment certificate shall be in a form prescribed by the Authority and shall include— An application for an investment certificate under section 16 shall be made to the Secretariat. the full name and address of the applicant; the shareholders and nationality of the business enterprise ; the nature of the business, its capital structure, business plan and the amount to be invested; and such other information, documents or particulars as may be specified in the application form.

Section Issue of investment certificate Section Subject to this section, an investment certificate— shall include the following— Where the investor to whom an investment certificate is issued— The Authority shall, if the application made under section 21 satisfies the requirements of this Code, issue an investment certificate within five days after receipt of the application, on such terms and conditions as it deems fit. Where the Authority refuses to issue an investment certificate, the Authority shall notify the applicant in writing of the refusal and of the reasons for the refusal. shall be valid for such period as shall be specified in the certificate; name and address of the business enterprise ; shareholders and nationality of the business enterprise ; the nature of the business activity; the terms and conditions attached to the certificate; and the period within which the investment shall commence. Where the investment to which an investment certificate relates is not commenced within the period specified under subsection (3)(b)(v), the investment certificate shall lapse. The investment certificate shall be in such form, and shall be issued in such manner, as may be prescrib...

Section Revocation of investment certificate Section Where the Authority is satisfied that an investor to whom an investment certificate is issued— is acting or has acted in breach of any term or condition of the certificate; has acted in contravention of this Act or any regulation made under this Act; has contravened any law under which a relevant permit or licence is being issued; or has acted in such a way as to tarnish the good repute of Uganda as an attractive base for investment , Where the Authority is satisfied that, having regard to all the circumstances of the case, it is expedient to do so, it shall revoke the investment certificate.

Section Protection in case of compulsory acquisition Section Where a registered business enterprise of an investor or an interest or right over property forming part of that enterprise is compulsorily taken possession of or acquired, the following provisions shall apply— The registered business enterprise of an investor or an interest or right over any property or undertaking forming part of that enterprise, shall not be compulsorily taken possession of or acquired except in accordance with the Constitution. prompt payment of fair and adequate compensation, shall be done prior to the taking of possession of the property; and a person who has a right or interest over the property has a right of access to a court of law in respect of any matter arising out of the taking of possession of the property. Compensation paid out to the investor under subsection (2) shall be freely transferable out of Uganda and shall not be subject to exchange control restrictions under the Foreign Exchange Act, 2004. Subsections (2) and (3) shall not be taken to exempt an investor from the application of applicable laws, rules and policies governing investors necessary for the reasonable control of foreign...

Section Settlement of disputes Section A dispute between an investor and the Authority or the Government in respect of a registered business enterprise which is not settled through negotiations may be submitted to arbitration in accordance with the following methods as may be mutually agreed by the parties— Where the parties to a dispute do not agree on the mode or forum for arbitration, the party aggrieved by compulsory acquisition or possession or the amount of compensation payable, or in respect of any other matter relating to the business enterprise may apply to the High Court for the determination of any of the following— Where a dispute arises between an investor and the Authority or the Government in respect of a registered business enterprise , all efforts shall be made to settle the dispute through negotiations for an amicable settlement in accordance with the Arbitration and Conciliation Act. in accordance with the procedures for arbitration provided under the Arbitration and Conciliation Act; in accordance with the rules of procedure for arbitration of the International Centre for the Settlement of Investment Disputes; or within the framework of any bilateral or multilat...

Section Funds and expenses of the Authority Section The funds of the Authority shall consist of— monies appropriated by Parliament for the purposes of the Authority ; monies accruing to the Authority including fees or charges received by the Authority in the carrying out of its functions; grants, gifts or donations to the Authority with the approval of the Minister ; any revenue derived from the sale of property, movable or immovable by or on behalf of the Authority ; interest on earnings; money borrowed by the Authority with the approval of the Minister ; and any other money or assets received by, or made available to the Authority for the purpose of performing its functions under this Act.

Section Annual budget of the Authority Section The Authority shall, in accordance with the Public Finance Management Act, 2015, cause to be prepared and submitted to the Minister for approval, estimates of income and expenditure of the Authority and the operating plan for the next financial year. The Authority shall not incur any expenditure exceeding its budget without the written approval of the Minister .

Section Investment of surplus funds Section The Authority may, with the approval of the Minister , invest as it considers fit, any monies of the Authority not immediately required for use.

Section Financial year of the Authority Section The financial year of the Authority shall be the same as the financial year of the Government.

Section Accounts and audit of the Authority Section The Board shall— keep proper books of accounts and all records relating to the transactions and affairs of the Authority ; within three months after the end of the financial year, prepare annual financial statements for the preceding financial year; within three months after the end of each financial year, submit the annual accounts to the Auditor General. The accounts of the Authority shall, in respect of each financial year be audited by the Auditor General or by an auditor appointed by the Auditor General. Auditor General or an auditor appointed by the Auditor General shall have access to all books of accounts, vouchers and other financial records of the Authority and be entitled to have any information and explanation required by him or her in relation to them as he or she may think fit. The Auditor General or an auditor appointed by the Auditor General shall, within three months after receipt of the accounts referred to in subsection (2), submit to the Minister and to Parliament a report on the audited accounts of the Authority .

Section Power to operate bank accounts Section The Board , with the authority of the Accountant General, may open and maintain such accounts as are necessary for the performance of the functions of the Authority . All monies received on account of the Authority shall be deposited in a bank account under subsection (1) as soon as practicable after being received.

Section Borrowing Section Subject to Article 159 of the Constitution and the Public Finance Management Act, 2015, the Board may with the approval of Parliament borrow money as may be required for meeting its obligations or for the discharge of the functions of the Authority under this Act.

Section Duty to operate on sound financial principles Section The Authority shall, in the performance of its functions under this Act, have due regard to sound financial principles and shall conduct its business in such a manner that, taking one transaction with another, and taking one year with another— its revenue is sufficient for meeting all charges, including interest on capital and loans properly chargeable to revenue account; sufficient provision is made to provide for depreciation of assets; and where any loss or bad debt arises in respect of any transaction, provision is made in respect of other transactions, whether of similar nature or otherwise, to offset the amount of that loss or debt.

Section Compliance with Public Finance Management Act, 2015 Section The Authority shall at all times comply with the Public Finance Management Act, 2015.

Section Disclosure of information Section Except as otherwise provided by law, a person shall not disclose any information obtained by him or her— while performing duties as a member of the Board or of any committee of the Board or as a member of the staff of the Authority , or as advisor or consultant to the Authority ; or as a member of any body consulted under this Act while performing duties relating to any such consultation. A person who contravenes subsection (1) commits an offence and is liable on conviction to a fine not exceeding one hundred currency points or imprisonment not exceeding one year or both.

Section Annual report Section The Authority shall, in each year, at such time as the Minister may direct, submit to the Minister , a statement of its activities in the preceding financial year, indicating any particular problems experienced by it in that year in carrying out its objects and functions and making recommendations for solving those problems and containing such other information as the Minister may request. The Authority shall submit to the Minister such other reports and information as the Minister may request. The Minister shall lay before Parliament all reports submitted to him or her under this section, not more than six months after submission.

Section Service of documents Section A document may be served on the Authority by delivering it to the offices of the Authority or by sending it by registered post to the Director General .

Section Regulations. Section Without prejudice to the general effect of subsection (1), regulations made under this Act may prescribe— a penalty in respect of any contravention of the regulations including— The Minister may, on the advice of the Authority , by statutory instrument make regulations for giving effect to the provisions of this Code. the forms to be used for any purpose under this Code; fees or charges to be paid in respect of any service performed under this Code; a fine not exceeding two hundred and fifty currency points or imprisonment not exceeding five years or both; a higher penalty for subsequent or repeated offences: additional penalties for continuing offences; directing the court convicting an offender to order the forfeiture of anything used in the commission of the offence.

Section Offences and penalties Section A person who— Where an offence is committed by a body of persons, then— knowingly or negligently gives false or misleading information to the Authority ; refuses or neglects to provide information or a service which the Authority may reasonably require for the purposes of the enforcement of this Code; refuses, without lawful excuse, to admit an officer or an agent of the Authority into the premises of his or her business enterprise or otherwise obstructs any inspection by an officer or agent of the Authority , in the case of a body corporate other than a partnership, every director or officer of the body is deemed also to have committed that offence; and in the case of a partnership, every partner or officer of that body is deemed to have committed that offence.

Section Power of Minister to amend Schedule 2 Section The Minister may, by statutory instrument and with the approval of Cabinet, amend Schedule 2.

Section Repeals, savings and transitional provisions Section For the avoidance of doubt and notwithstanding the repeal of the Investment Code Act referred to in subsection (1)— The Investment Code Act, Cap. 92 is repealed. all property, assets, rights and interests of the Authority under the repealed Act shall continue to be the property, assets, rights and interests of the Authority ; all obligations and liabilities subsisting against the Authority under the repealed Act shall continue to subsist against the Authority ; subject to this Act, any person holding any office in the Authority under the repealed Act shall continue to hold that office in the Authority ; the terms and conditions, including the salary, on which a person referred to in paragraph (c) was employed immediately before the commencement of this Act, shall be no less favourable than those that applied to that person’s office immediately before the commencement of this Act; there shall be no break or interruption in the employment of the person referred to in paragraph (c) because of this Act; any person holding office in the Authority under the repealed Act as Executive Director or Deputy Executive Director shall c...