Navigating New Horizons: How Tanzania's New Business Order Impacts Foreign Investors and Real Estate
Please Note: This article is based on the provided legal update and aims to inform. However, The Property Hub is not a real estate agency nor a legal firm, we openly aim to share information across these various stakeholders. We strongly advise all readers, especially non-citizens, to seek independent legal counsel from qualified professionals for specific advice regarding their individual circumstances and compliance with this new Order. If you’re seeking legal counsel or consult, our team is happy to connect you.
Yesterday, a government order. T, Provisionally titled “ The Business Licensing (Prohibition of Business Activities for Non-Citizens) Order, 2025.” (This Order), through Government Notice No. GN 487A was enacted. The order represents immediate implications for various business operations in Tanzania. This isn't just another legal update; it's a significant shift. For foreign investors eyeing the thriving Tanzania real estate market, this new Order carries substantial weight. It impacts not just how you might consider starting a business in Tanzania, but also, critically, previous strategies around residency and property investment. We've been analyzing its effects, and we want to share what this means for you.
Understanding the "Prohibition of Business Activities for Non-Citizens" Order, 2025
Published on July 28, 2025, as Government Notice No. GN 487A, this Order is a clear signal. Its primary purpose, as stated by Novus Law & Advisory Group, is to "strengthen and promote local content around some business activities and further allow/extend and ensure that local Tanzanians who are lawfully capable and able, can invest in and operate local businesses within the country." This means a definitive list of business activities are now off-limits for non-citizens in Tanzania.
Why This Order Matters to You:
Previously, some non-citizens might have considered establishing a broad-based business in Tanzania, even in sectors typically accessible to locals, as a pathway to residency, facilitating other plans like property investment. This new Order fundamentally changes that landscape. Investors looking to start a business in Tanzania are now "reminded to ensure that they have carried out the necessary measures and research in their investment and are fully prepared to substantially bring value to the economy through more niche businesses." The era of using general business incorporation as an indirect route to residency for broader aspirations within the Tanzania real estate market has certainly tightened.
Prohibited Activities: What Foreigners Can No Longer Do
The Order introduces a specific list of activities prohibited for non-citizens. This list is crucial for anyone considering business development or property investment linked to a new venture. Here are some key examples directly from the Order:
Wholesale and Retail Trade: The sale of goods on a wholesale and retail basis is now prohibited, with exclusions for supermarkets, specialised product outlets, and wholesale centers for local producers.
Mobile Money Transfers.
Repair of mobile phones and electronic devices.
Salon Business: Prohibited unless conducted within a hotel or for tourism purposes.
Home, office and environmental cleanliness.
Small-scale mining.
Postal activities and parcel delivery within the country.
Tour guiding within the country.
Establishment and operation of radio and television.
Operation of museums or curio shops.
Brokerage or agency in businesses and real estate. This is particularly noteworthy for those in our sector!
Clearing and forwarding services.
On-farm crop purchasing operations.
Ownership or operation of gambling machines or devices: Except within casino premises.
Ownership and operation of micro and small industries.
The Order also broadly prohibits other activities like unlicensed financial services, unapproved pharmaceuticals, high-emission industrial operations, unsanctioned data brokering, counterfeit goods, unregulated private security, and multi-level marketing schemes lacking genuine product value.
Serious Penalties for Non-Compliance
The implications for non-compliance are severe. Non-citizens found operating in contravention of these provisions face significant penalties. These include fines of up to Ten Million Shillings (TZS 10,000,000/-), potential six months imprisonment, and crucially, revocation of their visas and residence permits. Local Tanzanians aiding non-citizens in operating prohibited businesses also face fines of up to Five Million Shillings (TZS 5,000,000/-) and up to three months imprisonment. Businesses currently engaged in prohibited activities may be allowed to operate until their current license expires, followed by suspension.
What This Means for Your Real Estate Investment in Tanzania
This new Order, "The Business Licensing (Prohibition of Business Activities for Non-Citizens) Order, 2025," has direct relevance for anyone considering property investment or real estate ventures, especially if your strategy involved a related business setup:
Residency Pathways: If your pathway to residency was tied to operating one of these newly prohibited businesses, that route is now closed. This means your focus for long-term stay will need to shift to other compliant investment categories, which often include substantial property investment or specific high-value sectors.
Direct Real Estate Brokerage: The explicit prohibition of "Brokerage or agency in businesses and real estate" for non-citizens is a direct impact on our industry. This reinforces the need for clear understanding of local licensing and partnership requirements for foreign entities in the property market in Tanzania.
New Investment Focus: This Order pushes foreign investors towards more "niche businesses" that "substantially bring value to the economy". This might include large-scale tourism developments, specialized manufacturing, or high-tech ventures, which often naturally align with significant property investment in commercial or residential real estate to support those operations.
Due Diligence is Paramount: For any non-citizen looking to invest in Tanzania, thorough due diligence is more critical than ever. This includes a comprehensive review of any proposed business model against this new Order to ensure compliance and avoid severe penalties.
Navigating the Future of Business Development and Property Investment
The Tanzania real estate market remains incredibly attractive for property investment. However, the landscape for starting a business in Tanzania as a non-citizen has evolved. Proactive measures are essential to mitigate risks.
We at The Property Hub understand that regulatory changes can seem daunting, while we specialize in connecting you with premier real estate opportunities, our legal partners are here to help you secure expert legal advice regarding this Order. The Order emphasizes the need for an "immediate Compliance Assessment" for existing businesses and "strategic advice on identifying and securing the necessary licences and permits for new, compliant ventures".
FAQs: New Business Order and Your Tanzania Real Estate Investment
Q: Does this Order prevent foreigners from buying property in Tanzania?
No, this Order primarily concerns business activities. Foreigners can still engage in property investment in Tanzania through various established methods like leasehold, particularly in designated investment areas. However, it affects how non-citizens can operate certain businesses that might have previously facilitated residency.
Q: I am a non-citizen and currently operate a prohibited business. What should I do?
The legal update states that you "may be allowed to carry on such business until expiration of such licence and further suspension of the licence." However, it mandates "immediate compliance" and recommends "proactive measures" including seeking legal advice on lawful winding down or exploring alternative ventures.
It is critical to seek immediate legal counsel. Get in contact with us to connect you with expert counsel in the matter.
Q: Does this mean it's harder to get residency in Tanzania for investors?
While the Order doesn't directly change residency laws, it closes a pathway for residency that might have been sought through operating certain types of businesses. It reinforces that foreign investment for residency should be in high-value, non-prohibited sectors that substantially contribute to the economy.
Q: How does this affect foreign ownership in the real estate sector directly?
The Order explicitly prohibits non-citizens from "Brokerage or agency in businesses and real estate." This clarifies that direct real estate brokerage or agency services are now reserved for citizens. It does not, however, prohibit foreigners from owning Tanzania real estate for personal use or investment.
Q: Where can I find the official list of prohibited activities?
The legal update provides an extract of the "Schedule" listing the "BUSINESS ACTIVITIES PROHIBITED FOR NON-CITIZENS." For the full official Government Notice, you would refer to GN 487A published on July 28, 2025.
The Tanzania real estate market continues to offer incredible opportunities for property investment. Understanding the evolving regulatory landscape is key to success. For specific legal advice regarding the new Business Licensing Order, we strongly recommend reaching out to a qualified legal counsel, contact us at The Property Hub to connect you with expert guidance on navigating your property investment journey.
