ACQUISITION OF LAND BY FOREIGNERS FOR INVESTMENT IN TANZANIA:

LEGAL COMPLIANCE PROCEDURES

A Lucid Guidance and Thought Investment into the Existing Legal Regime

By

Mang’ee Laurent P.*

Abstract

The United Republic of Tanzania emerged has a frontrunner in attracting foreign direct investment
(FDI) within Africa, which has led to the influx of capital into the country, and helped the country
to receive billions worth of dollars of investment inflows. As investment stands out as a crucial
contributor to national income, Tanzania’s appeal to foreign investors, be they individuals and
corporations, seeking to invest across diverse sectors, necessitates a structured approach towards
land acquisition to initiate their investment projects. This article, delve into the legal compliance
steps mandated by Tanzanian law for foreigners aiming to acquire land for investment purposes.
Understanding and adhering to these legal compliance stipulations and procedures is paramount
for prospective investors to navigate the terrain effectively and ensure compliance with the law.

Keywords; Land, Acquisition, Foreigner, Village Land, General Land, Reserved Land, and
Investment.

1.0 Introduction

Land1 being one of the natural resources and an essential asset for investment and business
activities is not an individually vested property under Tanzanian laws. Rather, it is a public
property entrusted in the hands of the president as a trustee on behalf of the citizens of the
United Republic of Tanzania under Section 4(1) of the Land Act.2

As a general rule, in our jurisdiction a foreigner be it an individual or corporation is restricted

from owning or being allocated land, this is pursuant to Section 203 which provides that a
non-citizen shall not be allocated or granted land unless it is for investment purposes under

* LL.B, University of Dodoma (UDOM), Advocate Candidate at the Law School of Tanzania, Legal Officer
at Lyson Law Group.
1
Land is defined under Section 2 of the Land Act to include the surface of the earth and the earth below the
surface and all substances other than minerals and petroleum forming part of or below the surface, things
naturally growing on the land, buildings and other structures permanently affixed to or under land covered by
water.
2
[CAP 113 R.E 2019].
3
The Land Act [CAP 113 RE. 2019].

1|Page
the Tanzania Investment Act4 also Section 20(4)5 it provides that a body corporate whose
majority shareholders or owners are non-citizens shall be deemed to be non-citizens or foreign
companies. Wherefore, it is crystal clear that foreigner/foreign companies are restricted to be
allocated or granted land unless is for investment purposes in accordance with the law
meaning that they cannot own land but they can obtain a derivative right for purposes of
investment. This is done in order to promote investment in our country in different economic
spheres.

Being restricted to own or be allocated land in Tanzania does not mean that they cannot use,
the law has set the legal compliances and procedures to be followed for the foreigner to acquire
land for investment purposes where this is a central theme of this article.

2.0 Categories of Land in Tanzania

2.1 General Land

General Land is all public land which is not declared to be reserved land or village land as
explained under Section 2 of the Land Act6. This land is under the management of the
Commissioner for Lands. The right of occupancy may be granted to any citizen (individual
or corporate) upon application for any designated use. A foreign investor may be granted the
derivative right of occupancy for investment purpose through the Tanzania Investment Center
(TIC). The general land is considered to be 2% of the land.

2.2 Village Land

Village land is the land which has been declared to be village land under Section 7 of the
Village Land Act7 and it consists of the land within the boundaries of a village. The
administration and management of the village land is vested in the hands of Village Council,
and the Village Assembly. Under the village land a person is granted a Customary Right of
Occupancy to occupiers. The Village land is considered to be 70% of the land.

4
No 10 of 2022.
5
Land Act [CAP. 113 R.E 2019].
6
[CAP. 113 R.E 2019].
7
[Cap.114 R.E 2019]

2|Page
A foreign investor may acquire village land for investment by buying a piece of land from the
villagers or the Village Council. However, such land should be transferred from being village
land to general land in accordance with Section 4(1) of the Village Land Act. Thereafter, the
process of registration will be done through TIC and will issue a derivative title to an investor.

2.3 Reserved Land

Reserved land is that land reserved, designated, or set aside under the provisions of the;
Forests Act, National Parks Act, Ngorongoro Conservation Area Act, Wildlife Conservation
Act, Marine Parks and Reserves Act, Town and Country Planning Act, Highway Act, Public
Recreation Grounds Act, Land Acquisition Act, as provided under Section 6(1)(a).8 The
reserved land is mainly for purpose of conservation, national parks, marine parks, urban
planning, road reserve, public recreation grounds, hazardous land and land reserved for public
utilities. Reserved Land is considered to be 28% of the land which is made up of forests,
national parks and game reserves. Reserved land is governed by a number of specific laws but
the commissioner for lands has ultimate powers in management and administration.

3.0 The Legal Framework Governing Acquisition of Land by Foreigners in Tanzania

3.1 The Land Act [CAP 113 R.E 2019]

This Act provides for the basic law in relation to land other than the village land, the
management and administration of land (institutional framework), settlement of disputes and
related matters meaning that this Act is concerned with the general land where granted right
of occupancy (GRO) is granted. It provides for the land acquisition rules and procedures
under Section 22 and 25 of the Act, the Act provides the general conditions of a right of
occupancy and also provides for the general rule that, a foreigner being an individual or
foreign company cannot own or be allocated land in our country except for investment
purposes upon approval of the commissioner for land and the investment center of Tanzania.
Therefore, this Act is concerned with the administration of the general land in Tanzania
including acquisition, holding, use and disposition.

8
The Land Act [CAP 113 RE. 2019].

3|Page
3.2 The Village Land Act [CAP 114 R.E 2019]

This Act provides for the management and administration of village land, it establishes the
authority which oversee the proper administration of the village land, it provides for
procedures on how the village land can be acquired and disposed. Good enough under Section
49 the Act narrate the legal compliances and procedures for transfer of village land to general
land or reserved land and vice versa. So, this Act create a good environment for an investor
who wishes to invest his project in a land which is a village land, where it has to be transferred
first from the village land to general land and thereafter the land will be designated for
investment purpose.

3.3 The Investment Act, No. 10 of 2022.

This Act make provisions for investment in Tanzania, it provides for favorable conditions for
investors, institutional framework for co-ordination, protection, attraction, promotion and
facilitation of investment and how investment project can be registered. This Act provides
provide for procedures on how to obtain a certificate of incentive under Section 19(1) for both
fiscal and non-fiscal incentive for investment purposes in Tanzania and also it provides for
validity, cancellation and extension of certificate of incentive under Section 20 of the Act.

4.0 Institutional Framework

4.1 Tanzania Investment Center (TIC)

The Tanzania Investment Act10 establishes the Tanzania Investment Centre (TIC) under
Section 4(1) and it is established to be an agency of the government under the supervision of
the minister responsible for investment, the primary function of TIC is to carry out and co-
ordinate investment branding in the country and investment promotion activities. It is the
authority mandated to issue certificate of incentive upon application under Section 19 of the
Investment Act also it is an entity over which the land designated for investment purposes is
registered under its name. It has mandate to issue derivative rights to investors who meet the
requirements provided under the law. Under the TIC, a foreigner can be allocated land
designated for investment purposes and which is already listed, or can look for desirable land

9
The Village Land Act [CAP. 114 R.E 2019].
10
No. 10 of 2022.

4|Page
owned by a Tanzanian national, and after agreeing on the acquisition of such land with the
owner, the owner will surrender the existing certificate of title to the commissioner for lands
whereby it will be re-issued again as a land designated for investment purposes under the
name of Tanzania Investment Center and thereafter derivative rights issued to the investor
(foreign entity/company).

4.2 Commissioner for Lands

Commissioner for lands is the principal administrative and professional officer of, and adviser
to the government on all matters connected with administration of land and is responsible to
the minister for administration of the Land Act and matters contained in it as provided under
Section 10(1).11 The Commissioner for Lands is the one who is responsible to designate land
for investment purposes to Tanzania Investment Center (TIC), is also among of the important
catalyst in acquisition of land for investment purpose in Tanzania because his approval to
designate is very crucial.

5.0 Legal Compliances and Procedures to Acquire General Land

As noted, earlier foreigner they can acquire land for investment purposes through a derivative
right granted by Tanzania Investment Centre in accordance with the law.12 Wherefore the
following are the legal compliances and procedures to be followed and/or complied with for
a foreigner to acquire land for investment purposes in Tanzania;

1. Foreign investor has to identify/allocate land that suits purpose of investment, so he

has a wide range of options when choosing land depending on their requirements.
However, if he has not spotted out any piece of land is advised through legal
representative (Advocate) to make inquiry to Tanzania Investment Centre specifying
area of interest and desire in a certain locality. The TIC will provide the list of available
land which are either owned by the government or individuals for the foreign investor
to choose which portion or piece of land suit his investment purposes.
2. Application for certificate of incentive to Tanzania Investment Centre (TIC)

11
Land Act [CAP.113 R.E 2019].
12
https://www.tanzaniainvest.com/construction/realestate/acquiring-land-in-mainland-tanzania Accessed
on 12 February 2024.

5|Page
 Once a foreigner investor has identified a portion of land, is required to apply for
certificate of incentive to TIC which is vested with power to issue certificates as per
Section 19(1) of the Investment Act,13 in order to qualify for and obtain certificate of
incentive minimum fixed investment cost for New, Rehabilitation and Expansion
Projects should be at least US $ 500,000 for projects which are wholly owned by
foreign investors.14 According to Section 19(2)(a) to (g)15 where an application is for
new investment, it shall contain;-
a. The name and address for the proposed business enterprise, its legal form, its
bankers, the name and address of each director or partner and the name, address,
nationality and shareholding of each shareholder;
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. Information on how the investment will be financed;
f. Evidence of sufficient capital available for investment; and
g. An undertaking that the project shall be implemented as indicated in the
projections of the project.
When the TIC is satisfied with the application for certificate of incentive it will
continue to grant to the applicant.
3. Application for certificate for the Right of Occupancy to the Commissioner for Lands,
this is the procedure which has to be followed after issuance of the Certificate of
Incentive by the TIC, where the applicant is supposed to apply for the right of
occupancy and he will attach the certificate of incentive. This application is done in
accordance with the provision of Section 25(1) (a) to (h)16 which require the application
to be submitted on a prescribed form and accompanied by a photograph, accompanied

13
No. 10 of 2022.
14
Available at; https://www.tic.go.tz/pages/certificate-of-incentives accessed on 12 February 2024.
15
The Investment Act No. 10 of 2022.
16
Land Act [CAP. 113 R.E 2019].

6|Page
 by the prescribed fee, signed by the applicant or a duly authorised representative or
agent of the applicant, sent or delivered to the Commissioner or an authorised officer,
contain or be accompanied by any information which may be prescribed or which the
Commissioner may in writing require the applicant to supply, accompanied by a
declaration in the prescribed form of all rights and interests in land in Tanzania which
the applicant has at the time of the application, where any law requires the consent of
any local authority or other body before an application for a right of occupancy may
be submitted to the Commissioner, accompanied by a document of consent, signed by
the duly authorized officer of that local authority or other body and if made by a non-
citizen or foreign company, accompanied by a Certificate of Approval granted by the
Tanzania Investment Centre under the Tanzania Investment Act and any other
documentation which may be prescribed by that Act or any other law.
4. The Commissioner for Lands will determine the application and if he is satisfied, he
will gazette the application by using a prescribed Land Form No. 1.17 If no any objection
raised the commissioner will designate land to TIC for investment purpose.
The investor is required to pay the total costs of preparing the certificate of occupancy
and facilitation fee to TIC.
5. Thereafter, the certificate of title will be registered by the Registrar of Titles in the name
of Tanzania Investment Center, because land designated for investment purposes has
to be in the name of the Tanzania Investment Center.
6. Lastly, TIC prepares derivative right and application for leasehold title and both
parties (TIC and Investor) will put hands therein, then TIC will submit it to the
registrar if titles for registration. At this point the derivative right will be granted to the
investor for investment purposes.

17
The Land (Forms) Regulation, 2001.

7|Page
 It should to be noted that, if a foreign investor spot land owned by individual, after agreeing on the
acquisition of such land with the owner, the owner has to submit (Surrender) the existing title deed
to the Ministry of Lands,18 whereby it will be re-issued as a land designated for investment purposes
under the name of TIC. Then an investor will be required to follow legal procedures in order to get
derivative right over such piece of land.

6.0 Legal Compliances and Procedures to Acquire Village Land

Furthermore, foreign investor may spot a village land in which its acquisition has different
or peculiar procedures and legal compliance from the general land. Narrated as follows;

a) First and foremost, an investor has to spot a village land which he desires to
acquire for investment purpose.
b) Application for certificate of incentive, in accordance with Section 19(1)19
c) The investor after spotting the land which he wants to acquire, is required to
apply for that land through the Tanzania Investment Center, stating the
location of the land and the nature of the project be undertaken.
d) The TIC will introduce an investor to the Village Council, thereafter the Village
Council and Village Assembly will be convened to the discuss the matter and
the minutes arising from the meeting will be submitted to the respective district
authority for deliberations.
e) If the district authority approves the deliberations of the Village Council and
Village Assembly will forward the matter to the ministry of lands.
f) The minister of lands will forward the matter to the president for his approval
in order to change the village land to general land pursuant to Section 4(1) of
the Village Land Act,20 because for the village land to be designated for
investment purpose must be transferred from village land to general land.
g) After the president’s approval, the Village Land Form No. 8 will be prepared
and gazette stating that after 60 days, the said land will be transferred from

18
See, procedures for surrender of the Right of Occupancy under Section 43 of the Land Act [CAP 113 R.E
2019].
19
The Investment Act No. 10 of 2022.
20
[CAP. 114 R.E 2029].

8|Page
 village land to general land. If no objection is raised such land will be
transferred to general land.
h) The commissioner for lands will prepare Land Form No. 121 for gazettement
and the copies will be served to the Tanzania Investment Center for signatures.
If no any objection the commissioner for lands will prepare a certificate of right
of occupancy and an investor is supposed to pay all relevant fees.
i) Registration of a certificate of right of occupancy by the registrar of titles, and
it will be issued in the name of TIC designated for investment purposes.
j) TIC will prepare and submit the derivative and application for leasehold title
to the registrar of titles for registration.
k) Lastly, upon registration the TIC will collect the dully registered derivative
right and leasehold title from the registrar of titles and will issue to an investor
for commencing his investment activities.

NOTE

In transferring a village land to general land the following must be observed;

• The village land must be surveyed in accordance with the Land Survey Act Cap. 324
and valued in accordance with the Valuation and Valuers Registration Act No. 7 of
2016 and the Regulations made thereunder.
• If the village land to be transferred is occupied by the villagers, there must be payment
of compensation in accordance with Article 24 of the Constitution of United Republic
of Tanzania, the Land Acquisition Act22 and other relevant laws.

7.0 Conclusion

The acquisition of land by foreigners for investment purpose in Tanzania represents a

significant aspect of the country’s economic landscape, carrying both opportunities and
consideration for its development trajectory. The influx of foreign investment holds the
potential to inject vital capital into the economy, foster job creation, facilitate infrastructure
development, and stimulate growth cross various sectors. Such investments can enhance the

21
The Land (Forms) Regulation, 2001.
22
[CAP. 118 R.E 2019].

9|Page
competitiveness of Tanzania’s economy, bolstering its position within the global market and
driving forward its progress towards sustainable development goals.

However, there is a challenge associated with the process which is the timing of issuance of
the title. Relevant approvals at the local government authorities, Ministry of Lands and the
TIC to the point of issuance of the title can take long time depending on the complexity of the
transaction. It is recommended that the relevant authorities should take it upon themselves
that the approval is made timely, efficient, transparent and fairly fast for the purposes of
encouraging foreign direct investment in our country.

10 | P a g e
 REFERENCE LIST

STATUTES

The Constitution of United Republic of Tanzania, 1977.

The Land Act [CAP 113 RE. 2019].

The Village Land Act [CAP 114 R.E 2019].

The Investment Act, No 10 of 2022.

The Land Acquisition Act [CAP. 118 R.E 2019].

The Land (Forms) Regulation, 2001.

ONLINE SOURCES

https://www.tic.go.tz/pages/certificate-of-incentives accessed on 12 February 2024.

https://www.tanzaniainvest.com/construction/realestate/acquiring-land-in-mainland-tanzania
Accessed on 12 February 2024.

https://www.tic.go.tz/pages/certificate-of-incentives Accessed on 12 February 2024.

11 | P a g e