1. Introduction.

On 1^st July 2025, the East African Community Competition Authority (“EAC Authority”) announced that, effective 1^st November 2025, it will commence the receipt and assessment of notifications for mergers and acquisitions with a cross-border dimension within the East African Community (“EAC”) region. This development represents a pivotal milestone in the evolution of regional competition law within East Africa and is anticipated to significantly influence cross-border transactional activity.

2. Composition of the EAC and Existing Competition Law Landscape.

The EAC currently comprises eight Partner States: Burundi, the Democratic Republic of Congo (DRC), Kenya, Rwanda, Somalia, South Sudan, Tanzania, and Uganda. All Partner States, with the exception of Tanzania, are also members of the Common Market for Eastern and Southern Africa (“COMESA”), which maintains its own regional competition law framework. Tanzania, meanwhile, is a member of the Southern African Development Community (“SADC”). Accordingly, competition law in the EAC region is presently governed through a combination of national regimes and regional frameworks, including those of COMESA and SADC.

3. Regulatory Implications.

The operationalization of the EAC competition regime introduces an additional layer of regulatory oversight for transactions involving businesses operating within the region. While regional integration remains a central objective of the EAC, the concurrent application of multiple regimes raises concerns around potential jurisdictional overlap and regulatory uncertainty. The manner in which such conflicts—particularly between national authorities, the COMESA Competition Commission, and the EAC Authority—will be resolved remains to be clarified.

4. Legislative Background.

The legal foundation for the EAC competition regime was established by the EAC Competition Act, 2006, which sought to create a harmonized competition framework across Partner States. However, the EAC Authority remained largely dormant until recent developments. In 2024, an amendment Bill was passed introducing substantive changes to the 2006 Act. Thereafter, in mid-2025, a series of regulations, rules, and guidelines were promulgated to facilitate the implementation of the competition framework.

5. Jurisdiction and Scope of Application.

From 1 November 2025, the EAC Authority is expected to exercise exclusive jurisdiction over mergers and acquisitions with a cross-border effect within the EAC region—although the precise delineation of jurisdiction vis-à-vis national and COMESA frameworks remains uncertain.

Under the EAC framework, mandatory notification to the Authority will be required where the following thresholds are met:

• The combined turnover or asset value of the merging parties within the EAC is at least US$ 35 million; and
• At least two parties involved in the transaction each have turnover or assets amounting to at least US$ 20 million within the EAC;

Unless each party to the transaction derives at least two-thirds of its aggregate turnover or assets from one single EAC Partner State.

Importantly, the EAC regime is suspensory in nature. This means that transactions meeting the above thresholds must not be implemented prior to receiving clearance from the EAC Authority.

6. Filing Fees.

Merger filing fees have been prescribed by the Authority in the range of US$ 45,000 to US$ 100,000, depending on the combined asset or turnover value of the parties involved.

7. Implications for Market Participants

Businesses and investors engaged in transactions within the EAC will need to consider the expanded regulatory landscape and undertake a thorough competition law analysis at the early stages of deal planning. The proliferation of national and regional regimes—such as those in Kenya, Tanzania (including the semi-autonomous regime in Zanzibar), Uganda, Rwanda, and the DRC—necessitates a coordinated and jurisdiction-specific approach to competition filings.

8. Transitional Provisions and Outstanding Questions

The EAC Authority has indicated that any cross-border merger proceedings initiated or pending before a national competition authority or other relevant body in a Partner State prior to the issuance of the Gazette Notice (dated 1^st July 2025) will continue to be handled by those respective authorities. However, ambiguity remains regarding the treatment of transactions initiated between 1^st July 2025 and 1^st November 2025—the interim period before the Authority formally begins to receive applications.

9. Conclusion and Next Steps

The activation of the EAC Competition Authority marks a significant evolution in the region’s regulatory environment. Market participants should closely monitor further developments, particularly guidance on jurisdictional overlaps and transitional arrangements. We are currently undertaking a detailed analysis of the regulations and intend to publish a comprehensive client briefing in due course. In the meantime, stakeholders are encouraged to seek tailored legal advice in respect of any ongoing or proposed transactions that may trigger regulatory scrutiny under the new EAC regime.

Further Information:

This editorial is intended to give you a general overview of the Law. If you would like further information and clarification on any issue raised in this editorial, please contact.

Patrick Sanga
Partner
E: p.sanga@vemmaattorneys.co.tz

Haika-Belinda John Macha
Partner
E: hb.macha@vemmaattorneys.co.tz
M: +255 717 307 999

Mergers and Acquisitions (M&A) have become increasingly common in Tanzania as companies seek to expand their market presence, increase resources, and secure capital. These transactions can revitalize businesses, making them more efficient and competitive.

This article provides a general overview of the legal analysis and procedures governing mergers and acquisitions in Tanzania.

LEGAL ANALYSIS

Mergers and acquisitions in Tanzania are primarily regulated by the following laws:

1. The Fair Competition Act No. 8 of 2003 (“the Competition Act”);
2. The Competition Rules of 2018 (“the Competition Rules”); and
3. The Fair Competition (Threshold for Notification of a Merger) Order, 2006, as amended by the Fair Competition (Threshold for Notification of a Merger) (Amendment) Order, 2017 (the Competition Threshold Order).

It is important to note that competition law in Tanzania operates alongside sector-specific regulatory frameworks.

REGULATORY AUTHORITY

The Fair Competition Commission (FCC) is the primary regulatory body responsible for overseeing mergers and acquisitions in Tanzania. It was established under Section 62(1) of the Competition Act and is tasked with ensuring compliance with competition laws and protecting market integrity.

UNDERSTANDING MERGERS AND ACQUISITIONS

Definition of Key Terms

Under the Fair Competition Act, a merger is defined as the acquisition of shares, a business, or other assets—whether within or outside Tanzania—that results in a change of control over a business or its assets in Tanzania.

An acquisition, in relation to shares or assets, refers to obtaining any legal or equitable interest in those shares or assets, either individually or jointly. However, acquisitions made solely through a charge (e.g., as security for a loan) are excluded from this definition. Notably, the law considers an acquisition as a form of merger.

CHANGE OF CONTROL

A key element of a merger is the change of control. Although the Competition Act does not provide a specific definition, Tanzanian case law has clarified that change of control involves:

• Material influence: The ability of the acquiring firm to significantly affect the business policy and operations of the target company.
• Decisive influence: The power to determine the strategic direction of the company, which may arise through ownership of assets, shares, or voting rights.

MERGER NOTIFICATION REQUIREMENTS

Threshold for Notification

Mergers must be notified to the FCC if they meet the financial threshold outlined in Section 11(2) of the Competition Act. The current threshold, as specified by the Competition Threshold Order, is Tanzanian Shillings Three Billion Five Hundred Million (TZS 3,500,000,000).

The threshold calculation is based on the combined market value of the assets or turnover of the merging entities. This means that even acquisitions involving non-controlling minority shares require notification if the threshold is met.

Notification Procedure

The notification process is governed by the Fair Competition Act and Competition Rules and involves the following steps:

1. Filing a Notification: Submit a formal notification of the proposed merger to the FCC.
2. Review of Filing: Within 5 days, the FCC will confirm whether the filing is complete or incomplete.
3. Initial Assessment: If the filing is complete, the FCC has 14 days to determine whether the merger requires further examination. If no further review is needed, the merger is deemed approved.
4. In-Depth Investigation: If further examination is required, the FCC may prohibit the transaction for up to 90 days, extendable by an additional 30 days.
5. Final Decision: Upon completing its investigation, the FCC may:

• Approve the merger;
• Approve with conditions; or
• Prohibit the merger.

Prohibition of a Merger

A merger may be prohibited if it creates or strengthens a position of dominance in the market, as outlined in Section 11(1) of the Fair Competition Act.

A position of dominance is defined as the ability of a company to:

• Profitably and significantly restrain or reduce competition for a substantial period; and
• Hold more than 35% of the relevant market share.

Filing Fees

The fees for filing a merger notification are based on the combined annual turnover or asset value of the merging parties, using the most recent audited financial statements. The fees range from Tanzanian Shillings Twenty-Five Million (TZS 25,000,000) to Tanzanian Shillings One Hundred Million (TZS 100,000,000), depending on the size of the transaction.

PENALTIES FOR NON-COMPLIANCE

Failure to comply with the Competition Act can result in severe penalties. The FCC may impose a fine of between 5% and 10% of the annual turnover derived from Mainland Tanzania.

If the offending party is a corporate entity, its directors, managers, or officers may also be held personally liable unless they can prove they were unaware of the violation or took all reasonable measures to prevent it.

CONCLUSION

Tanzania’s legal framework for mergers and acquisitions is comprehensive and mandates strict compliance with notification and approval procedures. Companies considering a merger or acquisition must ensure they meet the legal requirements to avoid substantial fines and legal repercussions. Adhering to the Fair Competition Act and related regulations is essential for a smooth and legally sound transaction.

Further Information:

This editorial is intended to give you a general overview of the Law. If you would like further information and clarification on any issue raised in this editorial, please contact.

Patrick Sanga
Partner
E: p.sanga@vemmaattorneys.co.tz

Bernard Nkwabi
Senior Associate
E: b.nkwabi@vemmaattorneys.co.tz

INTRODUCTION TO THE REGULATIONS

The Capital Markets and Securities Authority (CMSA) of Tanzania, in collaboration with various stakeholders has developed the Draft Capital Markets and Securities (Private Equity and Venture Capital) Regulations, 2024. These regulations aim to provide a structured framework for the establishment and operation of private equity and venture capital businesses in Tanzania, the regulations will oversee Private Equity Funds (“PEFs”) and Venture Capital Funds (“VCFs”) within the financial sector in Tanzania.

OBJECTIVES

Subject to Regulation 3 of the Draft Capital Markets and Securities (Private Equity and Venture Capital) Regulations, 2024 (the “Draft Regulations”), the primary objectives of these regulations include the guidance for Establishment and Operation, providing clear guidelines for the establishment and operation of private equity and venture capital businesses. The Regulations aim to Regulate Venture Capital Business, regulating venture capital businesses including equity and debt securities.

Further the draft Regulations aims to protect the Investors by ensuring public awareness about venture capital businesses.

Also the draft Regulations aims at promoting financial inclusion by diversifying financial products and enhancing market liquidity, further the draft Regulations foster to promote and encourage innovations in capital markets through innovative business models, the same will strengthen the ecosystem for startups and small to medium-sized enterprises to drive economic growth.

KEY PROVISIONS

According to Regulation 6 of the Draft Regulations, any person who wishes to operate as PEF or VCF must obtain a Fund Management Licence (the “Licence”) from the CMSA. The Licence shall be provided to the applicant with eligibility of the required minimum paid-up capital, one-third of independent directors, and focus on small and medium-sized businesses.

The application for a licence certificate to the CMSA should be made in a prescribed form provided in the First Schedule to the Draft Regulations.

LICENCE REVOCATION AND SUSPENSION

The Licence can be canceled or suspended under regulation13 of the Draft Regulations by the CMSA if, among others, the directors, or employees have not performed their duties honestly and fairly in the opinion of the CMSA and contravene or fail to comply with any condition of the Licence.

REQUIREMENT FOR APPROVAL

Regulations 14, 15, 16, 17, 23, 24, and 27 of the Draft Regulations, require PEFs and VCFs, through their fund managers, to apply for an approval from the CMSA prior to the raising or collection of funds from investors. The application must be submitted using the form indicated in the Second Schedule to the Draft Regulations. Before issuing the approval letter, the CMSA will assess the fund pools’ eligibility, to ensure that they protect investor interests, in accordance with the applicable regulations.

AN OVERVIEW OF PEF AND VCF

The Draft Regulations provide a clear description of PEFs, defining them as investment vehicles that pool capital from sophisticated investors to invest in private companies, to generate returns from their growth. Their primary purpose is to collect capital from investors, such as, banks, insurance companies, or corporate bodies, and invest it in private companies, either by acquiring shares or providing debt financing.

On the other hand, VCFs are defined under the Draft Regulations as investment funds that manage the money of investors who seek equity stakes in startup and small to medium-sized enterprises with strong growth potential and characterized with high risk or high-return opportunities.

The difference between PEF and VCFs is that the former pools capital from sophisticated investors to invest in private companies, while the latter focus specifically on start-up companies, primarily by investing in or acquiring stakes in these businesses, often becoming shareholders by purchasing equity.

PROTECTION OF INVESTORS’ (INVESTMENTS ALLOCATION IN PEFS AND VCFS)

Subject to Regulations 20 and 26 of the Draft Regulations, the regulations  limit the usage of pooled funds for PEFs and VCFs. One significant limitation is that PEFs can only engage in large, emerging unlisted enterprises, with interests in a single unlisted company capped at 75% of the fund. Meanwhile, VCFs can only invest up to 25% in a single unlisted firm, with investments limited to small and medium-sized businesses.

PENALTIES FOR NON-COMPLIANCE

Subject to Regulation 41 (1) (a) (b) (c) (d) and (e), the CMSE, as the regulating authority may reprimand, suspend or de-register venture capital company or private equity company where; the registered venture capital company or registered private equity company ceases to meet the requirements for registration or fails to comply with the Act, any reports or other information filed by the registered venture capital or registered private equity company or fund manager are found to contain false or misleading information, or the registered venture capital or registered private equity company fails to take such corrective action in respect of a breach as indicated by Authority within the time prescribed, or the Authority becomes aware of any facts or circumstances, which in the opinion of the Authority, warrant deregistration of the registered venture capital or private equity company in the public interest; and if the board of directors of the registered venture capital company or registered private equity company requests in writing that the venture capital company or private equity company be deregistered.

CONCLUSION

The Draft Capital Markets and Securities (Private Equity and Venture Capital) Regulations, 2024, represent a significant step towards fostering innovation, attracting capital, and promoting financial inclusion in Tanzania. By providing a clear regulatory framework, these regulations are poised to enhance the country’s economic growth and development. This will be done through clear guidelines for the establishment, operation, management of funds, and fostering of conducive environment for investment in both established businesses and emerging startups.

Further Information:

This editorial is intended to give you a general overview of the Law. If you would like further information and clarification on any issue raised in this editorial, please contact.

Patrick Sanga
Partner
E: p.sanga@vemmaattorneys.co.tz

Bernard Nkwabi
Senior Associate
E: b.nkwabi@vemmaattorneys.co.tz

The Arusha Protocol for the Protection of New Varieties of Plants officially came into force on November 24, 2024, nearly 10 years after its adoption in Arusha, Tanzania, in July 2015. This Protocol creates a harmonized system for the protection of plant variety rights (PVRs) across the member states of the African Regional Intellectual Property Organization (ARIPO). It allows applicants to apply for protection through ARIPO, ensuring uniform protection in the contracting states that participate.

Under the Protocol, PVR protection is granted for 25 years for trees and vines and 20 years for all other plant varieties.

The system closely follows the 1991 Act of the International Convention for the Protection of New Varieties of Plants (UPOV 1991), which has faced both support and criticism worldwide. Critics argue that the Protocol will mostly benefit multinational seed companies, potentially threatening local farmers’ rights, particularly their ability to save, replant, and exchange seeds. However, the Protocol allows for a limited exception where farmers can save and replant certain agricultural and vegetable varieties, but they must pay remuneration to the PVR holder.[1]

Supporters of the Protocol argue that it could lead to the development of more sustainable and climate-resilient plant varieties, improve farmers’ access to better seeds, and ultimately enhance food security and stimulate economic growth across the continent.

The Protocol also provides a safety net. According to Article 4(1), PVR protection will have uniform effect in all contracting states unless a state refuses the grant within six months of receiving the application, provided the state offers specific grounds for refusal.

So far, only Four (4) of ARIPO 22 member states—Cape Verde, Ghana, Rwanda, and São Tomé and Príncipe, have ratified the Protocol. Given the ongoing debate surrounding the Protocol’s potential impact, it will be interesting to see whether more ARIPO member states choose to adopt it in the future. The success of the Protocol will depend on balancing the interests of multinational companies and local farmers, as well as ensuring the protection of Africa’s agricultural diversity.

Further Information:

This editorial is intended to give you a general overview of the Law. If you would like further information and clarification on any issue raised in this editorial, please contact.

Haika-Belinda John Macha
Partner
E: hb.macha@vemmaattorneys.co.tz
M: +255 717 307 999

Haika Allen Mrango
Associate
E: h.mrango@vemmaattorneys.co.tz
M: +255 746 716 191