Uganda Market Entry

Uganda Market Entry

Subchapters:

  • Market entry
  • Forms and conditions of operation on the market
  • Marketing and Communications
  • Issues of intellectual property protection
  • Public procurement market
  • Payment terms, payment ethics and resolution of commercial disputes
  • Visas, fees, specific conditions of travel to the territory
  • Employment of citizens from the Czech Republic
  • Fairs and events

Market entry

The basic regulation governing import and export conditions in Uganda is a regional law passed by the East African Legislative Assembly, the East African Community Customs Management Act, 2004 (EACCMA) i.e. the East African Community Customs Tariff of 2004. In addition, Uganda enacted the Excise Duty Act of 2014, which also has an impact on the import of goods. Check smber for agriculture and fishing facts of Uganda.

The Uganda Revenue Authority (URA) is mandated to collect taxes, including customs duties, and oversee and implement tax laws in Uganda. Uganda’s average MFN tariff is 13%. Agricultural products face more barriers (20%) compared to non-agricultural products (12%). As a member of the EAC, Uganda also participated in the negotiations on the Comprehensive Regional Economic Partnership Agreement with the EU.

The Uganda National Bureau Of Standards is responsible for standards and quality control and for ensuring their application. Technical regulations are developed by several ministries. According to the WTO Trade Policy Review, 530 Ugandan standards have been harmonized with EAC standards. Uganda does not apply exchange controls. The local currency is freely convertible. Any payment made in foreign currency to or from Uganda between residents and non-residents or between non-residents must be made through a commercial bank. Every private company must have a registered office in Uganda to which all communications and notices can be addressed and which is the address for service of court notices.

Companies are registered by the Uganda Registration Services Bureau (URSB), registration takes approximately one day to complete once the required documents are submitted. A company is deemed to be resident in Uganda if it is incorporated under Ugandan law; or has its place of effective management in Uganda. In terms of transfer pricing rules, transactions between related companies must be concluded at arm’s length. If one of the companies directly or indirectly participates in management, control or has a capital share in the other company, or a third party directly or indirectly participates in management, control or has a capital share in both companies, these companies are considered related.

Forms and conditions of operation on the market

Foreign companies intending to do business in Uganda must apply for an investment license issued under the UIA (Uganda Investment Authority) Investment Companies Act. Investments in the power generation, mining, banking, aviation, pharmaceutical, education, healthcare, telecommunications, and oil and gas industries must obtain a “secondary license” from the relevant ministry/agency that regulates the industry before applying for investment licenses.

Businesses operating in Uganda must also hold a valid business license issued by the relevant Municipal Licensing Authority (KCCA in Kampala). A business license must be obtained for each branch / business of the entity. If a Czech natural or legal person is interested in establishing an office, representation or joint venture in Uganda, it is recommended to contact the state agency, UIA (Uganda Investment Authority), which is able to communicate the current conditions for the implementation of the investment plan.

Types of entities that are available for foreign investment:

– Exclusive ownership;

– partnership;

– public trading company (joint-stock company)

– limited liability company;

– joint venture;

– public-private enterprise;

– a registered branch of a foreign company

The following benefits are available for foreign investors:

– incentives supporting agricultural activities;

– tax holidays provided to investors in industrial parks or economic zones depending on the amount of invested capital;

– incentives available under the EAC, including duty drawback schemes

Marketing and communication

Marketing requirements are usually negotiated with the relevant local representative, who often asks for financial support to introduce a certain product to the market. The promotion aspect does not differ from the form common in developed countries and is often underestimated by Czech exporters. On-site promotion cannot be carried out without English brochures and technical descriptions. For consumer goods, but also for some equipment, promotion in the media, especially in the press, is usual.

From the field of digital promotion, it is advisable to have your FB page. A number of Ugandan companies use FB exclusively for their promotion and do not even have their own website.

Issues of intellectual property protection

Like many developing countries, Uganda is an active member of the WTO. However, the protection of intellectual property is still minimal at the legislative level, and its practical application is even worse. Anglo-Saxon show-business suppliers are primarily at risk, but the threat is limited by the very limited purchasing power of the population, for whom even clean data carriers and playback devices are no longer available. Another group in which Czech companies could appear to a limited extent are software manufacturers. However, copying mainly concerns consumer and entertainment software. The theft of technological software applications as well as circumvention of patent rights, which could threaten Czech companies the most, point to the country’s low technical culture.

The following international agreements have legal force:

  • African Regional Intellectual Property Organization (Banjul Protocol)
  • Agreement on Trade-Related Aspects of Intellectual Property Rights
  • Paris Convention for the Protection of Industrial Property
  • Nairobi Treaty
  • World Intellectual Property Organization
  • World Trade Organization

Although Uganda is a member of the Paris Convention, it is not a signatory to the Madrid Protocol. Therefore, there is no provision in Ugandan law regarding international trademark arrangements. Therefore, it is not always possible to claim the priority of the convention. However, the registry accepts priority in practice, although the effectiveness and validity of the priority claim is unclear.

Public procurement market

Public contracts are generally awarded in the form of tenders. The first step, especially in the case of tenders for construction work or consultancy activities, is the pre-qualification and registration of interested parties, who, if they are evaluated as suitable for the given purpose, are then approached directly by sending tender conditions. Tenders are published in the daily press. However, the deadlines for submitting bids tend to be very short, so only those companies that are physically present at the location or that have their representatives have a real hope of success.

The formal system and legal framework within tenders is set by the (PUBLIC PROCUREMENT AND DISPOSAL OF PUBLIC ASSETS) Act PPDA 2003 and regulations supplementing the PPDA. The Public Procurement and Administration of Public Assets Act (PPDA) 2003 established the Public Procurement and Administration of Public Assets Authority (PPDA) as the main regulatory body for public procurement and the administration of public assets in Uganda.

Amendments to the Act on PPDA brought changes based on which the role of PPDA in the performance of its regulatory mandate was strengthened.

Contact at PPDA:

PPDA Head Office, UEDCL Towers Plot 39 Nakasero Road POBox 3925, Kampala Uganda, Tel: +256-414-311100, Email: [email protected]

In the case of tenders that are financed by some banks or agencies of which the Czech Republic is not a member (e.g. African Development Bank), it is necessary for the Czech supplier to use a company based in a country that is a member country of the given bank or agency for its offer.

Payment terms, payment ethics and resolution of commercial disputes

The Ugandan legal system is primarily based on statute law supplemented by common law, customary law and aspects of Islamic law. The Jurisprudence Act prescribes the laws in force in Uganda as written law, and where not covered by written law, the common law and doctrines of equity, or established and current custom, shall apply. Where no express rule is applicable, the High Court may act in accordance with the principle of justice and good conscience. In the event of a dispute between a foreign investor and the government in relation to a registered investor, efforts shall be made to resolve the dispute through amicable settlement negotiations.

If the dispute is not settled through negotiations, it may be submitted to arbitration. Uganda has adopted the New York Convention and the ICSID Convention. Thus, the Uganda Foreign Investment Act 2019 provides a procedure for the settlement of investment disputes through the following four channels:

– direct negotiations on amicable settlement in accordance with the Act on Arbitration and Conciliation

– ICSID Convention, under bilateral or multilateral investor protection agreements where both Uganda and the government from which the company originates are signatories

– a complaint to the High Court, or · other internationally recognized dispute resolution procedures

– The Law on Arbitration and Conciliation allows the use of international arbitration conventions that can be applied to domestic and international commercial disputes

Alternatively, disputes can also be resolved through the court system. In the case of new business contacts, an irrevocable documentary letter of credit, opened at a reputable bank, is used. It is not uncommon for smaller orders to be paid in advance for new customers.

Visas, fees, specific conditions for traveling to the territory

Requirement for entering the country for holders of all types of CR passports – a valid entry or transit visa.

Holders of Czech passports can apply for a visa 1) via the Internet, on the website managed by the Ugandan Ministry of the Interior https://www.visas.immigration.go.ug; this option is highly preferred by the Ugandan authorities; 2) at the Embassy of Uganda in Berlin – detailed visa information is on the website of the embassy

The administrative fees for applying for Ugandan visas are as follows: Diplomatic visa (for holders of diplomatic and official passports) – fee-free Regular tourist visa, transit visa USD 50 Multiple entry visa for 6 or 12 months USD 100 Multiple entry visa for 24 months USD 150 see the article on the website of the Ugandan Embassy in Berlin https://berlin.mofa.go.ug/data-dnews-144-WARNING-AGAINST-FRAUDULENT-ELECTRONIC-VISA-(e-Visa)-APPLICATION-PORTALS.html

The Embassy of Uganda in Berlin warns against fraudulent sites offering to process Ugandan visas. According to the article, these sites try to appear official, but their real purpose is to confuse applicants and fraudulently extract a high fee from them. The distinguishing mark is that the fraudulent sites do not have the official logo of the Uganda Directorate of Citizenship and Immigration Control with the Ugandan coat of arms.

Therefore, applying for a Ugandan online visa must always be done exclusively from https://www.visas.immigration.go.ug/

It is generally recommended to obtain a visa online before traveling to Uganda, as it ensures relatively quick clearance at the border. Applying for a visa at the airport or land border crossing is often associated with a long wait.

A normal tourist visa does not allow you to perform gainful activities on the territory of Uganda.

We recommend that you check the current conditions of entry into the country at the Ugandan embassy accredited to the Czech Republic before your trip. Contact: Embassy of the Republic of Uganda Email: [email protected] or [email protected] website: https://berlin.mofa.go.ug/

With regard to frequent questions from the public, we emphasize that the Embassy of the Czech Republic in Nairobi does not take part in the process of issuing Ugandan visas. We recommend addressing any questions to the Ugandan Embassy in Berlin.

Employment of citizens from the Czech Republic

Foreign workers need a special pass or work permit for employment in Uganda. A special card is a short-term work permit granted to foreign employees whose employment period does not exceed a cumulative period of five months, given that work permits are granted to foreign employees whose employment is valid for six months to three years. As a prerequisite to obtaining a work permit for a foreign employee, a company must go through a profiling process and obtain a code number from the Directorate of Citizenship and Immigration Control (DCIC). The company can then apply for the relevant work permit online using the code number issued by the DCIC.

The number of work permits available to the company is not limited in any way. In practice, DCIC approves applications for work permits if the employer provides the required documentation and pays the prescribed fees for the relevant work permits and successfully demonstrates that the employees will contribute their skills and knowledge to the success of the company’s business, and that it is not readily available to obtain the required skills from local Ugandan employees. The DCIC also sets out different specific requirements for different employment sectors.

In terms of Ugandan labor regulations, an employee may be temporarily assigned to Uganda. In this case, there is no legal requirement for local or foreign employees to be employed by a local entity. However, from the point of view of Ugandan immigration legislation, employment with a local employer is a prerequisite for applying for a work permit.

Fixed-term employment contracts that are defined by time or purpose are permitted within the meaning of the Employment Act.

It is not required that remuneration for work be paid in local currency.

Every employer employing five or more employees must register with the NSSF within 21 days of becoming required to register as a contributing employer. In addition, each employee must have their own NSSF social security number to which contributions are made.

Most Ugandan health facilities can only provide basic medical services, and buildings often lack basic necessities such as running water and electricity. Health facilities often do not have enough staff to run the center. In addition, more complex treatment and diagnostic methods such as MRI and CAT scans are not available. More serious illnesses such as cancer, stroke and heart disease can be difficult to treat in the country. General surgery is available, but with a shortage of doctors, waiting times can be weeks to months. Foreigners working in Uganda should purchase international health insurance before arriving in Uganda. There are also private hospitals in the country that provide more complex services to a limited extent. Furthermore, it is strongly recommended that foreigners have such insurance, which will cover the costs of emergency evacuation and transport to neighboring countries or to Europe. In the event of a serious injury, the cost of transportation to the nearest medical center outside of Uganda can cost tens of thousands of USD.

Fairs and events

Uganda International Trade Fair – 3 – 10 October 2022 – Uganda Manufacturers Association – Uganda International Trade Fair (uma.or.ug)

Larger regional fairs are held in Kenya and one needs to check carefully whether the “international” fairs are really of more than local importance.

Uganda Market Entry