Issuance of licences on ‘free of charge and for life’ in Tanzania has caused impracticable to keep on track businesses that remain operational, given that businesses are not required to get annual licence renewals.
According to the Business Climate Index (BCI), launched in Dar es Salaam at the weekend, although the move has enabled more businesses to start up, however, the practice has created a negative impact on the growth of business in the country.
Therefore, the BCI which was conducted by the East African Business Council (EABC), suggests that a feasible solution would be to consider it mandatory to make annual non-payable returns to enable the monitoring of business growth.
The study further discloses that although many business practitioners are aware of the requirements on business registration in Tanzania, as well as in other East African countries, however, there has been a sizeable percentage of operators that experience problems in getting to know about new business registration and licencing requirements and procedures.
The move implies that there are limitations in cross border movement of businesses as provided for by the Common Market Protocol, which result in late deliveries in the process of sorting out non-conformance issues.
The Common Market is aimed at availing greater opportunities for trade in goods and services as well as providing opportunities for greater capital mobilisation to boost investment in the region, it says.
According to the survey, it takes five steps to get a new business registered either at the national level or in any of the EA countries, whereas getting a business licence takes up to a month.
Nevertheless, Tanzania ranks number two after Rwanda based on perceptions by both responsible institutions in charge of registration and licencing position on ease and efficiency of business registration and licencing procedures and administrative requirements
The study further notes that, Tanzania therefore needs to focus its attention on addressing the identified bottlenecks by implementing solutions proposed which include harmonisation, better treatment of EA citizens, training of government officials, better information dissemination, and improvement of paperwork related to business registration and licencing.
EABC is the apex body of business associations of the private sector and corporate entities from the five East African countries. It was established in 1997 to foster the interests of the private sector in the integration process of the East African Community.
Originally comprising members from Kenya, Tanzania and Uganda, its membership was expanded to include private sector from Burundi and Rwanda after 2007.
Currently, EABC has 54 associations and 102 corporate members. Amongst the associations are all the national private sector apex bodies; four manufacturers’ associations; five chambers of commerce, three employers’ associations; two women associations, two bankers’ associations and the Confederation of Informal Sector Associations of East Africa.
Given that the secretariat is based in Arusha, EABC’s structure includes National Focal Points (NFPs) - who are all currently the national private sector apex bodies.