Petroleum Supply Act

Section Application Section This Act applies to the import, export, re-export, transport, processing, supply, storage, distribution , wholesale and retail sale and sale to industrial consumers of petroleum products and related activities and installations in Uganda. The provisions of this Act which relate to petroleum products , as defined in section 3 , also apply to natural gas, whether imported or produced in Uganda, including compressed natural gas and liquefied natural gas. This Act applies to all persons, all departments and other agencies of Government and all public corporations, subject to specific exemptions as prescribed by regulations. This Act does not apply to the requirement of any enactment for a permit or a licence for prospecting, exploration, development or production of petroleum in Uganda or the transportation, storage, processing or transformation of that petroleum subject to the conditions of the permit or licence and within the area covered by that permit or licence .

Section Objective Section The objective of this Act is— to ensure that petroleum supply in Uganda is adequate, reliable, efficient and economical for the country and the consumers according to the prevailing conditions at any given time; to strengthen the institutional capacity of the Government in order to better formulate and implement petroleum supply policies; to improve petroleum governance by clarifying the functions of institutions responsible for petroleum supply and to make the operations of those institutions more accountable and transparent; to ensure public safety and protection of public health and the environment in all petroleum supply operations and installations; to ensure effective delivery of petroleum products and services to consumers and to ensure equal access to petroleum products of adequate quality at competitive prices for all consumers; to create favourable conditions for operators and investors in order to increase the diversification of the sources of supply, to improve services and to expand the infrastructure of the supply chain ; and to ensure a steady supply of petroleum products by the development and maintenance of national strategic stocks ; to f...

Section Interpretation Section In this Act, unless the context otherwise requires— “ code of practice ” means the code of practice declared as such under section 16 of the Uganda National Bureau of Standards Act except as otherwise provided in this Act; “ Commissioner ” means the Commissioner heading the department of petroleum supply within the Ministry; “ Committee ” means the Technical Petroleum Committee established under section 6 ; “ consumer price index ” means the national and consumer price index published by the Uganda National Bureau of Statistics; “ currency point ” has the value assigned to it in Schedule 1 to this Act; “ distribution ” means the ownership, operation, management or control of distribution facilities for movement or delivery of petroleum products to consumers; “ emergency petroleum supply plan ” means the emergency petroleum supply plan approved in accordance with section 32 ; “ environmental impact assessment ” means a systematic examination conducted in accordance with the National Environment Act, to determine whether or not a project will have any adverse impact on the environment; and includes environmental reviews, evaluations and impact studies a...

Section Regulatory authority of Minister Section The Minister shall have the following specific functions in relation to this Act— The Minister shall be responsible for the implementation of this Act. to initiate legislation and make the necessary regulations in order to support and promote a continuous, secure and adequate supply of petroleum products at competitive cost for all consumers and to create favourable conditions for the availability of adequate import, transport, storage and distribution facilities within or, if necessary, outside Uganda; to promote the increase of opportunities for regional petroleum trade and encourage a diversity of supply sources, routes and means of transportation; to approve by order the emergency petroleum supply plan prepared by the Commissioner under section 32(1) ; to appoint the members of the Committee in accordance with section 7 ; and perform any other function given to the Minister by this Act. For purposes of carrying out the functions of the Minister under this Act, there shall be established in the Ministry, a department of petroleum supply. Subject to the Constitution and other laws providing for the appointment of public officers, t...

Section Functions of Commissioner Section The Commissioner shall have the following specific functions— The Commissioner shall supervise, control and ensure the effectual and impartial enforcement of this Act and other applicable laws, regulations, administrative orders, standards, specifications , codes of practice and the recommendations of the Committee . to provide technical advice to the Minister in all legislative and regulatory matters concerning petroleum supply operations ; to establish, implement and administer an effective and equitable licensing system for petroleum supply operations and installations in accordance with this Act; to receive, evaluate and process all applications for and approve the granting, renewal, assignment, suspension or revocation of all permits and licences in accordance with this Act; to ensure the establishment, maintenance and periodic updates of the national petroleum information system and the evaluation and dissemination of the information derived from the petroleum information system in accordance with this Act; to organise, implement and coordinate with other Government agencies the monitoring process of the operations, installations and...

Section Tenure of office of members of Committee Section A member of the Committee may be removed by the Minister — The members of the Committee shall be appointed for three years and each member is eligible for re-appointment for one more term. Any member of the Committee may resign at any time by giving notice in writing to the Minister , specifying the effective date of the resignation. for inability to perform the functions of his or her office arising out of physical or mental incapacity; for misbehaviour; for misconduct; for incompetence; upon a written request by the nominating authority withdrawing his or her nomination; or if he or she fails to attend five consecutive meetings of the Committee without reasonable excuse. If a vacancy occurs on the Committee for any reason, other than the expiration of the term of office of the member, the Minister shall appoint a replacement for the member ceasing to hold office for his or her remaining term in office in accordance with section 7 , except that if the remaining period of the term is less than six months, no replacement shall be appointed under this subsection.

Section Functions of Committee Section The Committee shall— advise the Minister on proposed legislation, technical standards and specifications relating to petroleum products and the supply chain ; develop and submit to the Minister proposals for the improvement of the petroleum supply policies, systems, regulations, technical standards and codes of practice; coordinate the preparation of the emergency petroleum supply plan referred to in section 32 and review its final draft and any updates before submission to the Minister for approval; advise and support the Minister and the Commissioner in the implementation of this Act and other applicable laws; advise the Minister on matters concerning taxes or levies on petroleum products and other petroleum supply operations and related matters; serve as mediating body in disputes between the participants in the supply chain and between the participants and the Commissioner as provided for in section 38 ; and do any other act provided for by or under this Act or any other law or as may be assigned to the Committee by the Minister .

Section Meetings of Committee Section Schedule 2 to this Act shall have effect in relation to meetings of the Committee and other matters set out in that Schedule.

Section Subcommittees of Committee Section The Committee may appoint one or more subcommittees, whether ad hoc or otherwise, to assist it in the performance of its functions and may assign to any such subcommittee such functions subject to such conditions as the Committee may determine. The Committee shall determine the procedure of a subcommittee appointed under this section. Section 14 shall apply for the determination of allowances to members of subcommittees appointed under this section.

Section Remuneration of members Section A member of the Committee or a person attending any meeting of the Committee may be paid such sitting and other allowances as the Minister may approve in relation to him or her.

Section Establishment of Technical Petroleum Committee Section There is established a committee to be known as the Technical Petroleum Committee , in this Act, referred to as the Committee . The Committee shall consist of a Chairperson and eight other members appointed by the Minister . The members of the Committee shall be appointed from among persons who possess qualifications and expertise in respect of petroleum supply and related matters.

Section Appointment of members of Committee Section The other members of the Committee to be appointed by the Minister shall be— Subject to section 6 , the Minister shall appoint as Chairperson of the Committee a person whether a public officer or not, who has neither been employed by, nor has had direct business relations with the Ministry or any of the authorities of bodies or groups referred to in subsection (2) during the period of one year preceding the date of appointment. one representative of the Ministry responsible for transport nominated by the Minister responsible for transport; one representative of the Uganda National Bureau of Standards nominated by the Executive Director of the bureau; one representative of the Ministry responsible for finance nominated by the Minister responsible for finance; one person representing the licensees or associations of licensees for petroleum retain operations; one person representing consumers of petroleum products ; two persons representing licensees or associations of licensees for petroleum import, re-export, wholesale or storage operations; and one person representing licensees or associations of licensees of petroleum transporter...

Section Secretary to committee Section The Commissioner shall be the Secretary of the Committee and shall attend or be represented at all meetings of the Committee and its subcommittees but shall not have a right to vote. Where the Committee intends to consider a matter concerning the Commissioner personally, it may resolve, by majority vote, that attendance of the Commissioner or his or her representative should be dispensed with.

Section Deputy chairperson and deputy secretary Section The Committee shall elect from the members appointed under section 7(2)(d) , (e) , (f) and (g) , a Deputy Chairperson and a Deputy Secretary of the Committee. The Deputy Chairperson shall, notwithstanding section 7(1) , exercise the functions of the Chairperson in the absence of the Chairperson. The Deputy Secretary shall exercise the functions of the Secretary in the absence of the Secretary.

Section Obligation to obtain permit or licence Section A person shall not carry out the construction or major modification, of an installation or facility of the supply chain without having obtained a petroleum construction permit under this Act. A person shall not perform petroleum supply operations without laving obtained a petroleum operating licence under this Act. For purposes of this section, the Minister shall make regulations under section 42 to prescribe what amounts to major modification as referred to in subsection (1) .

Section Application for permit or licence Section To obtain a permit or licence for one or more activities in the supply chain under section 15 or for a renewal or assignment of a permit or licence, the applicant shall submit to the Commissioner a written application in the prescribed form. The procedure for submission of applications and for evaluating, processing and approving or rejecting the applications and the particulars to be submitted by the applicant for the purpose shall be prescribed by regulations. During the processing of an application, evaluation, approval or rejection, all applicants shall be treated equally without any discrimination or preferences, and the Commissioner may not require or impose any terms or conditions which are not specified or authorised by or under this Act. Any approval by the Commissioner required under this section in relation to a permit or licence shall not be unreasonably withheld or delayed. The applicant, with the assistance of the Commissioner , shall obtain additional authorisations from other competent authorities if and when required by the applicable laws. An applicant for a permit or a licence or for the renewal or assignment of a...

Section Employment of experts Section The Commissioner , with the agreement and at the expense of the applicant, may employ local or international experts for the purpose of evaluating applications for permits or licences. The amounts and the terms of payment of the fees and the reimbursement of expenses for experts under subsection (1) shall be as may be agreed with the applicant. If no agreement is reached with the applicant concerning the selection or compensation of any expert, the Commissioner may reject the application.

Section Commissioner to submit returns to Committee Section At the end of each month, the Commissioner shall forward to the Committee a list of all applications for permits and licences submitted during that month and the action taken by the Commissioner on the applications, and shall provide additional information as may be requested by the Committee . Information and particulars furnished with an application and classified as confidential by the applicant shall not be published or otherwise disclosed by the Commissioner or any other person obtaining knowledge of them without prior consent of the applicant.

Section Validity of permits and licences Section A permit shall be valid for five years or until the completion of the work in question and the acceptance of the work by the Commissioner according to the procedure prescribed by regulations, whichever is earlier, but may be extended for five years upon the payment of the prescribed fee. A licence shall be valid for a period not exceeding twenty-five years, as prescribed by regulations, depending on the type of activity to which it relates, and shall be renewable, in accordance with conditions prescribed by regulations, subject to payment of the prescribed fee.

Section Assignment of permits and licences Section A permit or licence shall not be assigned by or otherwise transferred from he holder to another person without the prior approval in writing of the Commissioner and subject to the payment of the prescribed fee, unless otherwise provided for by regulations.

Section Suspension or revocation of permit or licence Section Notwithstanding any other remedies or penalties for offences provided for under this Act or any other enactment— a permit or licence may be suspended by the Commissioner where there is a contravention of any provision of this Act or any other enactment concerning the protection of occupational health, public safety and the environment or for any other reason stated by or under this Act; a permit or licence may be revoked by the Commissioner where the holder fails to remedy or repeats any contravention of any provisions of this Act or regulations made under this Act concerning the protection of occupational health, public safety and the environment, or for any other reason specified by or under this Act.

Section National strategic stocks Section Notwithstanding section 24 , the Government shall, at its expense, maintain such strategic stocks, in this Act referred to as the national strategic stocks.

Section Maintenance of strategic stocks subject to Act Section Subject to section 33 , all installations and operations for the purpose of establishing and maintaining strategic stocks under this section, including, but not limited to, the storage, transport and sale or any other form of disposition of the stored products, shall be subject to the provisions of this Act.

Section Maintenance of records and furnishing information Section Every holder of a permit or licence shall maintain such records as are required to be kept by or under this Act and shall furnish to the Commissioner such reports and information as may be required to be forwarded by or under this Act or as the Minister or the Commissioner may require in writing for the purpose of giving effect to this Act. The holder of a permit or licence shall maintain an address in Uganda to which communications may be sent and shall give written notice to the Commissioner of that address and of any change in that address.

Section Inspection Section For the purpose of ensuring that this Act and regulations made under it are complied with, the Commissioner or a person authorised by the Commissioner in writing, may, at any time during regular business hours, enter upon and inspect any area or premises where petroleum operations or construction works for facilities of the supply chain are being performed. An inspection may be announced or unannounced, as the Commissioner may consider necessary, but shall always be performed in the company of a representative of the operator whose area or premises are to be inspected. A person carrying out an inspection under subsection (1) may inspect the works, facilities and records including books and accounts connected with the operations of the holder of the permit or licence for ensuring that this Act is complied with. The Commissioner or a person authorised in writing by the Commissioner may, at any reasonable time, stop and search any vehicle or vessel belonging to a holder of a permit or licence for the purpose of ensuring that this Act is complied with.

Section Minimum working stock requirements Section For the purposes of this section, the minimum working stocks shall include all petroleum products held in storage depots in Uganda and shall exclude petroleum products — In order to ensure continuity of the petroleum supply of Uganda, every licensee shall, at his or her expense, maintain minimum working stocks of petroleum products as prescribed by regulations. The level of the stocks under subsection (1) shall not be less than ten days of the average amount of any product handled or consumed by the respective licensee within Uganda during the period of three months preceding the effective date of determination. in transit within Uganda or to and from any other country; held in retail service or filling stations; and held in consumer storage locations. Where changes occur in the levels of minimum stocks for any licensee of petroleum products by the amendment of any regulations made by virtue of subsection (2) , those changes shall only apply to new licences or the renewal of existing licences. The level of minimum working stock for new licensees shall be determined at the start of operations, based on the information furnished with...

Section National Petroleum Information System Section There is established an Information System to be known as the National Petroleum Information System. The Information System shall be organised and maintained by the Commissioner . The Information System shall consist of an integrated and centralised database and information system covering all petroleum supply operations and installations, the principal market activities and statistics of Uganda as well as international reference data. For the purposes of this section, all licensees shall submit to the Commissioner periodic reports and other information as prescribed by regulations. The Commissioner shall publish the data contained in the Information System in aggregate form with the exception of information which has been qualified as confidential by the licensee in order to protect proprietary market data or for any other reasons as determined by the Commissioner .

Section Central registry of petroleum operations Section The Commissioner shall establish and maintain a central petroleum registry for the purpose of monitoring the supply chain . The central petroleum registry shall form part of the Information System and shall include a record of all applications, grants, variations, assignments, other transfers, suspensions and revocations of permits and licences and all relevant information about the holders and their operations and installations.

Section Supply chain of petroleum products Section For the purposes of subsection (3) , the exceptional circumstances are— Subject to subsection (2) , any person, whether Ugandan or foreign, may participate in all or any activities of the supply chain, in accordance with this Act and any other applicable laws. The importation and supply of petroleum products destined for the Ugandan market to the licensed oil marketing companies shall be undertaken by the Uganda National Oil Company Limited. Notwithstanding subsection (2) , the Minister may, by statutory instrument, with the approval of Cabinet, under exceptional circumstances, nominate such other person, to import and supply all or a portion of petroleum products listed in Schedule 3 to this Act. where the Uganda National Oil Company Limited fails to import and supply petroleum products in any given month; or where the Uganda National Oil Company Limited becomes insolvent. The licensed oil marketing companies shall purchase all their petroleum products requirements from the Uganda National Oil Company or such other person nominated by the Minister under subsection (3) .

Section Prohibition of activities against fair competition Section Participants in the supply chain shall not form cartels or attempt to control prices or create artificial shortages of products or services, or engage in any other restrictive trade practices or any other acts or omissions which are contrary to the principles of fair competition or are intended to impede the functioning of the free market for petroleum products in Uganda. Except as otherwise provided by regulations, participants in the supply chain shall sell their products and offer their services to all interested persons without undue delay and without any form of deliberate discrimination by means of quality, quantity or price or other conditions and restrictions which cannot be justified under legitimate commercial or operational grounds. Except where a petroleum supply emergency has been declared under section 32 , the prices for petroleum products throughout the supply chain shall be governed solely by the rules of supply and demand in a free and competitive market. The Commissioner shall monitor the conditions of the market and the trade practices of the participants in the supply chain . The reference price...

Section Negotiated access to unused capacities of third party facilities Section For the purpose of promoting the creation of a competitive petroleum product market for participants in the supply chain , there are established the following conditions for the access to essential components of the infrastructure of the supply chain , such as depots, pipelines and other facilities— that a licensee who owns or operates a facility which has unused capacity, may negotiate in good faith with any qualified person interested in the use of that capacity, in order to establish the tariff and other reasonable terms and conditions for using the facility; and that the interested person must be a person who holds or has applied for the licence required for the operation in question and provides proof of his or her capacity to pay the tariff and fulfil other reasonable financial and technical conditions as agreed upon with the owner or operator or both, of the facility.

Section Adoption and adaptation of international standards and specifications Section The Commissioner shall develop and implement or cause the implementation of a programme of gradual adoption and adaptation of the prevailing international standards, technical specifications and codes of practice in relation to the petroleum supply industry in cooperation with the Uganda National Bureau of Standards and the Committee . The standards, specifications and codes of practice as established by the standards developing organisations which are recognised by the international petroleum industry in matters of quality, industrial safety and environmental protection, shall be adopted by the Uganda National Bureau of Standards by reference and declared as national standards in accordance with section 16 of the Uganda National Bureau of Standards Act , after being adapted as necessary, taking into account the socioeconomic realities of the petroleum products market of Uganda. Where relevant international standards, specifications or codes of practice have not been formally adopted according to subsection (2) , the Minister may, after consultation with the Committee and the Uganda National Burea...

Section Environmental impact assessments Section The Commissioner shall act as the “lead agency” within the meaning of the National Environment Act, in the process of conducting environmental impact assessments and audits and implement other requirements for environmental protection in the supply chain , in accordance with the applicable laws. The Commissioner shall prepare a classification of petroleum operations and projects and, in consultation with the National Environment Management Authority, prepare guidelines for environmental impact assessments and audits, but where appropriate, may continue with the guidelines for the time being in force. The Commissioner shall periodically inform the Committee and seek its opinion about the preparation of, or changes in, the classifications and guidelines referred to in subsection (2) . Where environmental impact assessments or audits are performed or required or other conditions are to be met by the holder of a permit or licence in accordance with the laws applicable to public health, public safety and the environment, the Commissioner shall coordinate with the National Environment Management Authority and other appropriate authorities...

Section Emergency petroleum supply plan Section In order to respond to interruptions in, or serious distortions of, the petroleum supply occasioned by accidents, political disturbances, natural disasters or similar events or by the negligence of any person , the Commissioner shall, in cooperation with other Government departments and agencies, the Committee and participants in the supply chain , prepare an emergency petroleum supply plan . The Commissioner shall submit the plan prepared under subsection (1) to the Minister for approval. Where the Minister is satisfied that any of the events described in subsection (1) has occurred, the Minister may, by statutory order, declare that a petroleum supply emergency has occurred. Where the Minister has made a declaration under subsection (3) the Commissioner may, with the approval of the Minister, temporarily intervene in the supply chain and implement such measures as are provided for in the emergency petroleum supply plan. Regulations shall prescribe the method of preparation, the contents and mode of implementation of the emergency petroleum supply plan .

Section Offences and penalties Section Any person who— refuses, delays or fails to produce any document or other information required to be submitted to any authority under this Act relating to petroleum supply operations and installations or which he or she is required to produce under this Act; knowingly or without reasonable grounds for believing it to be true, furnishes any document or information which is false or misleading in any material particular, whether upon demand or otherwise; endangers the functioning of the free market or the competitive supply system in contravention of section 28 ; resists, hinders or obstructs the Commissioner , or any person authorised by the Commissioner to enter or inspect any premises or area or to stop and search any vehicle or vessel or to examine any books, accounts or other records, or to otherwise discharge his or her functions and rights under this Act; publishes or otherwise discloses any information which is considered confidential under section 18(2) , 25(5) or under regulations made under this Act; or refuses, delays or fails to comply by willful misconduct or by negligence with any order , prohibition, direction, demand, requiremen...

Section Offences by directors, agents, employees, etc. Section Where a person charged with any offence under this Act is a body corporate, every person who, at the time of the offence is committed, was a director, manager, secretary or similar officer or agent of that body corporate, may be charged jointly or severally in the same proceedings with the body corporate and is liable, on conviction, to the penalty prescribed for the offence. A partner in any unincorporated enterprise, firm or joint venture shall be jointly and severally liable for the acts or omissions of any other partner insofar as the acts concern the enterprise, firm or joint venture. Notwithstanding subsections (1) and (2) , a director, manager, secretary or similar officer or partner or agent is not liable under those subsections if he or she proves to the satisfaction of court that the act in question was committed without his or her knowledge, consent or connivance, and that he or she took all necessary steps to prevent the commission of that act, having regard to all the circumstances. An employer who employs in or for his or her operation or place of business any agent, clerk, servant or other person , is ans...

Section Initiation of actions by consumers Section Any holder of a permit or licence , any consumer of petroleum product or any recognised consumer organisation may initiate civil proceedings before a court of competent jurisdiction or subject to the powers of the Director of Public Prosecutions, file a criminal complaint, as the case may be, against any holder of a permit or licence for any offence under this Act, if he or she has previously filed a complaint with the Commissioner and feels aggrieved by any act or omission of the Commissioner in response to the complaint.

Section Non-binding mediation by Committee Section The Committee may— Any dispute between the holders of permits or licences, or between such holders and the Commissioner concerning the implementation of this Act or regulations made under this Act may be submitted by the parties involved to the Committee for non-binding mediation. request the parties to appear before it; request for any information, documents or testimony by witnesses or experts which it considers necessary; and conduct other investigations. The Committee shall submit a written opinion about the dispute to the parties involved within sixty days from the receipt of the request for mediation, unless the period is extended by the Committee by written notice to the parties. The mediation proceedings of the Committee shall not be held in public and the opinions submitted shall not be published, unless otherwise agreed upon between the parties with the consent of the Committee . The Committee shall establish, by resolution, a general procedure for the mediation process according to applicable laws and prevailing practice for private mediation in Uganda. The Committee shall, with the approval of the Minister , prescribe f...

Section Administrative review by Minister Section Any person aggrieved by any decision of the Commissioner or of any officer authorised by the Commissioner , may within twenty-one days after being notified of the decision, request, in writing, an administrative review of the decision by the Minister . The Minister may, within forty-five days after receipt of a request for administrative review under this section, confirm, set aside or vary the decision complained of. The Minister shall give reasons, in writing, for his or her decision on a review under this section.

Section Application to High Court for judicial review Section Any person aggrieved by— the rejection by the Minister of a request for administrative review under section 39 ; any direction or order by the Minister under this Act; or any other act or omission by the Minister under this Act, may, within thirty days after receipt of notification of the act or omission complained of, or, if the Minister fails to decide on an administrative review, within thirty days after the expiration of the period prescribed in section 39(2) , apply to the High Court for judicial review. On an application to the High Court under this section, the High Court may make such orders as it may consider just.

Section Protection of members of Committee, public servants and others Section A member of the Committee and a public officer or other person acting by the direction of the Committee or the Minister shall not be personally liable for anything done or omitted to be done in good faith in the performance of functions vested in that person by the Committee or the Minister or by or under this Act.

Section Regulations Section The Minister may make regulations establishing a petroleum fee to enable the Government to maintain the national strategic stocks under section 33 and the regulations shall provide for— Regulations made under this Act may, without prejudice to subsection (1) — prescribe, in respect of any contravention of the regulations— The Minister may, by statutory instrument, after consultation with the Committee , make regulations for giving full effect to the provisions of this Act. The Minister shall, in particular, make regulations under subsection (1) , to provide for anything required or authorised by this Act to be prescribed by regulations. the petroleum fee to be charged on such petroleum products as shall be prescribed in the regulations; the amount of the fee to be prescribed by the Minister in consultation with the Minister responsible for finance but the fee shall not be more than 0.0005 currency points per litre; and the fee to be collected monthly by the Commissioner to be paid into the Consolidated Fund. provide for forms and fees or charges to be made under this Act; and a penalty not exceeding forty-eight currency points or imprisonment for a term...

Section Power to amend Schedules Section The Minister may, by statutory instrument, with the approval of Cabinet, amend Schedule 1 to this Act. The Minister may, by statutory instrument, amend Schedule 2 to this Act.

Section Certain acts not to apply to petroleum products Section The provisions of Part IV of this Act concerning permits and licences shall be taken to have replaced the provisions of the following Acts so far as petroleum products are concerned— the External Trade Act; and the Trade (Licensing) Act .