By Aziza Sekro
On 28 July 2025, the Government of Tanzania published Government Notice No. 487A, introducing the Business Licensing (Prohibition of Business Activities for Non-Citizens) Order, 2025. This new law prohibits non-citizens from engaging in a wide range of business activities in Tanzania.
But what exactly does “non-citizen” mean and does the Order affect foreign-owned companies operating in the country?
Who Is a “Non-Citizen”?
The Order refers to the Tanzania Citizenship Act, which provides a definition of who is considered a Tanzanian citizen. According to the Act, a person is a citizen if they:
- Were born in Tanzania mainland or Zanzibar or to a Tanzanian parent (citizen by birth),
- Were born outside Tanzania to at least one Tanzanian parent (citizen by descent), or
- Acquired citizenship through naturalization.
The Act does not provide a separate definition for “non-citizen.” However, by implication, any individual who does not fall under the above categories is considered a non-citizen for purposes of this Order.
Does this Apply to Foreign-Owned Companies?
In legal terms, the word “person” can mean either a natural person (an individual human being) or a legal person (a company, corporation, or other legal entity recognized by law).
The Tanzania Citizenship Act and this Order use the term “non-citizen,” which refers only to natural persons (individual human beings). It does not extend the concept of citizenship or non-citizenship to legal persons such as companies.
If the Ministry of Industry and Trade intended this Order to apply to companies (legal persons) with foreign ownership, it would likely have used broader language such as “person” or explicitly referred to definitions found in other laws, including the Companies Act or Tax Laws, which clearly define companies, ownership, and control.
Because the Order specifically restricts “non-citizens” (natural persons), the legal interpretation is that it targets individual foreign nationals and does not directly apply to companies, even if owned or controlled by foreigners.
That said, in practice, licensing authorities sometimes treat companies with majority foreign ownership as foreign entities when issuing or renewing licenses, creating some practical uncertainty.
Until the Ministry issues further guidance, foreign-owned companies should carefully review their ownership structures and licenses to manage compliance risks.
Prohibited business activities
The Schedule to the Order lists 15 categories of business activities that non-citizens are prohibited from engaging in. These include:
- Wholesale and retail trade (except supermarkets, specialized product outlets, and wholesale centers for local producers)
- Repair of phones and electronic devices
- Salon businesses (unless they are operated in hotels or for tourism purposes)
- Cleaning services (home, office, and environment)
- Small-scale mining
- Parcel delivery and postal delivery
- Tour guiding
- Operating museums and curio shops
- Real estate agency and business brokerage
- Clearing and forwarding services
- On-farm crop purchasing
- Operating of gambling machines (except within casinos)
- Ownership and operation of micro and small industries.
Non-citizens holding valid licenses for these activities before the Order came into effect may continue operating until the license expires but will not be allowed to renew.
Sanctions for Non-Compliance
The Order introduces significant legal consequences for both non-citizens and Tanzanian citizens who violate its provisions. Any non-citizen who engages in the prohibited business activities listed in the Schedule commits an offence and, upon conviction, is subject to a fine of not less than TZS 10 million or imprisonment for a term not exceeding six months. In addition, such conviction may lead to the revocation of the individual’s visa and residence permit.
Tanzanian citizens are not exempt from liability. If a citizen assists or facilitates a non-citizen in carrying out any of the restricted business activities, they also commit an offence. Upon conviction, the citizen may face a fine of TZS 5 million or imprisonment for up to three months.
These sanctions underscore the government’s commitment to enforcing the localization of certain economic sectors and serve as a warning to individuals and businesses that may attempt to circumvent the law.
Final Thoughts
This new Order clearly signals the government’s focus on economic localization. However, the current lack of clarity on who exactly qualifies as a “non-citizen” creates significant compliance risks.
We expect further clarification to be issued, specifying whether the Order applies only to individual sole proprietors or also includes companies.
In the meantime, we are here to support you with legal interpretation, risk management, and liaising with relevant authorities to help ensure your business remains compliant.