Tanzania

General Information Banking
Business Etiquette Tips Embassy Locations and Registration
Employment-Legal Requirements Entry and Exit Requirements
Intellectual Property Legal and Registration of a Business Entity
Safety and Crime Taxes

General Information

TanzaniaTanzania possesses many exciting treasures, such as mountain climbing to the top of Mount Kilimanjaro, big-game fishing or visiting with wildlife in one of several national parks, scuba diving along the beautiful island of Zanzibar, or discovering the sights of the Serengeti. 

Tanzania has been instrumental in brokering peace deals and commercial agreements with its neighboring countries, namely the Burundi conflict and the Lusaka agreement with the Democratic Republic of the Congo. A politically stable but financially struggling country, Tanzania is working to improve the growth of its tourist industry and attraction to foreign investors and businesses. The country has the support of the international community as it endeavors to break free from economic dependence upon foreign aid for its success. With its wealth of natural resources, it is well positioned for economic growth, provided it can improve its infrastructure, streamline governmental reform, and eliminate corruption at all levels.

There may be political unrest and/or targeted crime against visitors to the country.  Travelers should check with the U.S. State Department Web site for current travel safety information.

Major Cities
 Capital: Dar es Salaam (executive), Dodoma (legislative).
Major cities: Arusha, Mwanza, Mbeya, Mtwara, and Stonetown in Zanzibar.
Official Currency
Tanzanian shilling (TZS).
Time Zone UTC+3 (8 hours ahead of Washington, D.C. during Standard Time).
Language Kiswahili (official), English (official, primary language of commerce, administration, and higher education), Arabic (widely spoken in Zanzibar), and many local languages.

 
Legal System and Government

Type of legal system: The Tanzanian legal system is based on English common law. Judicial review of legislative acts is limited to matters of interpretation. It has not accepted compulsory International Court of Justice (ICJ) jurisdiction.

Form of Government

Republic

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Banking

Available Banking Services

ATMs
Online banking
Banking in English
Overdraft protection

Bank Holidays

New Year's Day
Zanzibar Revolution Day  
Good Friday and The Prophet's Birthday 
Easter Monday  
Sheikh Abeid Amani Karume Day  
Union Day 
Labor Day 
Maonyesho ya Saba Saba
Wakulima ya Nane Nane  
Iddi el Fitry Holiday (End of Ramadan) 
Julius Nyerere Day 
Independence Day 
Iddi El Haji (Feast of the Sacrifice)
Christmas Day
Boxing Day  

U.S. and Other Major Banks in Country

(Note: Address and contact information subject to change.)

Standard Chartered
Principal Office
1st Floor, International House
Branch-Dar es Salaam - International House Branch
Corner Shaaban Robert & Garden Avenue
Dar es Salaam, Tanzania
Phone:  255 (22) 2122160
Fax:  255 (22) 2113770
Web:  http://www.standardchartered.com/tz/en/

Citi
Peugeot House
36 Upanga Road
P.O. Box 71625
Dar es Salaam, Tanzania
Phone: (255) 22-211-7575
Fax: (255) 22-211-7576
Web: http://www.citigroup.com/citi/about/countrypresence/tanzania.html

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Business Etiquette Tips

Business Attire

Conservative dress is expected for both men and women in Tanzania, which generally means a conservative business suit. 

Business Negotiations

A successful business relationship will depend in part on taking the time to establish a good working rapport with your counterparts. Tanzanians are not insulted by negotiations regarding price, and they will often engage in such actions. 

Proper Greetings

Greetings generally consist of shaking hands between male colleagues, but some women do not shake hands, so it is best to wait for a woman to extend her hand. 

Scheduling Appointments

Appointments should be scheduled approximately two weeks in advance and reconfirmed prior to the date. Punctuality is appreciated, and your counterpart will make the effort to arrive on time as well. But do not be surprised if you are kept waiting.

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Embassy Locations and Registration

Americans living or traveling in Tanzania are encouraged to register with the nearest U.S. embassy or consulate through the State Department's travel registration Web site so that they can obtain updated information on travel and security within Tanzania. Americans without Internet access may register directly with the nearest U.S. embassy or consulate. By registering, American citizens make it easier for the embassy or consulate to contact them in case of emergency.

(Note: Address and contact information subject to change.)

U.S. Embassy in Tanzania
686 Old Bagamoyo Road
Msasani, Tanzania
Phone: (255) 22-266-8001
Fax: (255) 22-266-8238
Web:   http://tanzania.usembassy.gov/

United Republic of Tanzania in D.C.
1232 22nd Street, NW
Washington, D.C. 20008
Phone:  (202) 884-1080, (202) 939-6125/7
Fax: (202) 797-7408
Web: http://www.tanzaniaembassy-us.org

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Employment-Legal Requirements

An employer can make an employment agreement with an employee either orally or in writing. All of the details of a job, however, are to be provided in writing to all employees. This statement should, at a minimum, include the hours, pay, any benefits, job description, and duties, as well as starting date, location the work is to be performed at, and other specifics that may apply. 

Terminating Employees

Generally speaking, if an employee has completed 12 months of service they are entitled to seven days severance per each year employed. Except in cases where an employee is terminated with cause, a minimum notice period of 28 days is required for all monthly employees. All terminations are to be given in writing, and they should include the reason for termination. 

Notice of termination cannot be given while the employee is on leave, and it cannot run concurrently with a period of leave. In lieu of notice, an employer may pay the employee the salary he would have received if the employee had worked during the notice period.

Annual Vacation Leave 28 days paid leave (after 12 months)
Sick Leave Up to 126 days - 63 days at 100 percent pay; 63 days (after 36 months) at 50 percent pay (must present a medical certificate)
Maternity Leave* 84 days paid maternity leave or 100 days if more than one child is born at the same time
Paternity Leave 3 days paid leave
Miscellaneous Leave 4 days paid leave (family illness, death of family member)

* An employee is entitled to an additional 84 days paid maternity leave within the leave cycle if the child dies within a year of birth.

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Entry and Exit Requirements

A passport and visa are required for travel to Tanzania.  U.S. citizens with valid passports may obtain a visa either before arriving in Tanzania or at any port of entry staffed by immigration officials. Tanzanian law is very strict on visa categories. A recurring problem encountered by Americans is that volunteer activity is prohibited on a tourist visa. Americans who are traveling to Tanzania for short- or long-term volunteer projects should review their status with the sponsoring organization before entering the country.

Any foreigner planning to stay in Tanzania for longer than three months should register under the Immigration Registration Act. Upon registration, the individual will be issued a Resident Permit stating name, address, and other particulars. Any foreigner who intends to work or invest in Tanzania requires a resident permit issued by the Immigration Office of the Ministry of Home Affairs.

Dependent passes: Each member of a work permit holder's family requires a dependent pass, which is stamped in the passport. Any dependent seeking work must obtain a separate work permit.

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Intellectual Property 

Patents are granted by the government through an agency known as Business Registration and Licensing Agency (BRELA). This office, in collaboration with the African Regional Intellectual Property Organization and World Intellectual Property Organization (WIPO), deals with the protection of patents at national, regional, and international levels.

Nature of Rights and Terms

Patents

A patent is protected for 20 years from the date it is granted, after which time it belongs in the public domain and is free to be used by anyone interested. This 20-year term includes an initial 10 years that is renewable for two additional five-year terms upon application to the registrar by the patentee.

Trademarks

Trademarks are initially protected for seven years, after which time it can be renewed for an additional 14-year period. A trade or service mark is a distinctive sign, be it a name, signature, drawing, or anything that is used to distinguish similar goods or services of various manufacturers or those rendering such services.

Enforcement

Tanzania is a member of ARIPO (African Regional Intellectual Property Organization), the regional patent filing system in Africa. ARIPO allows applicants to designate any or all of the 16 member states where protection is required through completion of one application and, upon approval, provides uniform protection for all states selected. The total of the fees owed is determined by the number of member states selected. The standard periods of protection are 20 years for patents; 15 years for industrial designs; an indefinite period of time for marks (trade or service); and 10 years for utility models.

Infringers of registered trade or service marks face legal action and financial penalties that can bankrupt an individual. The best advice to the manufacturing and the trading community is to register their trade and service marks in order to avoid unknowingly using someone else's mark. In Tanzania, the first to register a mark is considered the owner of it.

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Legal and Registration of a Business Entity

All companies are required to be registered in Dar Es Salaam. The principal forms of business organization are sole proprietor, partnership, joint venture, and incorporated company, or a registered branch of an overseas company.

Registration Formalities (Including Timing)

The World Bank estimates approximately four weeks and 9 separate steps to establish a private limited liability presence in Tanzania.  For more details on establishing an official presence, visit the World Bank's Web site or the Tanzania Investment Center that essentially offers "one-stop shopping" for business set-up needs. 

The steps as recommended by the World Bank are listed here in concise order:

  1. Apply for clearance of the proposed company name at the Business Registration and Licensing Authority "BRELA".
  2. Obtain a notarized declaration of compliance.
  3. Apply for incorporation of a company and obtain certificate of incorporation.
  4. Apply for taxpayer identification number (TIN) with the Tanzania Revenue Authority..
  5. Obtain taxpayer identification number (TIN).
  6. Apply for business license from the regional trade officer (depending on the nature of business).
  7. Apply for VAT certificate with the Tanzania Revenue Authority..
  8. Register for the workmen's compensation insurance at the National Insurance Corporation or other alternative insurance policy.
  9. Obtain registration number at the National Social Security Fund (NSSF).

(Source:  The World Bank, Doing Business - Tanzania)

Below is an additional listing of resources to assist in establishing an office.

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Safety and Crime

All travelers near the borders of Rwanda and Burundi should exercise caution and maintain a high level of security vigilance as violent and terrorist actions occur on a regular basis. It is also recommended that individuals should avoid political rallies and public gatherings.  As in major American cities, street crime can be a serious problem in Tanzania, and visitors should be alert and cautious. But the number of highly dangerous attacks is small, and the majority of American residents and tourists enjoy Tanzania in peace. Travelers are always urged to practice common-sense security and remain vigilant of their surroundings. If a situation does not seem right, travelers should follow their instincts and leave the scene.

Special note: Travelers are urged to use bottled water for drinking and food preparation as tap water is considered unsafe. Cholera is prevalent in many areas of Tanzania, and several strains of malaria are common. Travelers are strongly advised to carry malaria suppressants with them. Visitors should consult their physicians before traveling to learn about prophylaxis and the possible side effects of various available medications. Medical facilities are limited and medicines are sometimes unavailable, even in Dar es Salaam.

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Taxes 

Currently no tax treaty has been concluded between Tanzania and the United States.  Prior to hiring foreign nationals, resident employers are required to demonstrate that a Tanzanian national is not able to fill the position, and employees must first obtain a work permit. The Tanzanian tax year corresponds to the calendar year and ends on December 31st.

Individual and Employee Taxation

Determining Tax Residence

An individual is considered resident for tax purposes if they have permanent home in Tanzania and were present at any time in the tax year, present in Tanzania for 183 days or more in the tax year, present in that tax year and in each of the two preceding tax years for a total of more than 122 days per year, or if they are an employee or an official of the Government of Tanzania regardless of their residence during the tax year.

All residents are taxed on their worldwide income.  A complete listing of the progressive individual income tax for all income levels can be found on the Tax Rates Web site for Tanzania.

Nontax Resident Employees

Any individual present in Tanzania for less than 183 days is automatically termed nonresident and taxed only upon Tanzanian-sourced income.  Another  category, known as a short-term resident (defined as a temporary resident who has spent less than two years of their entire life in the country and with no intent on staying longer) is also only taxed on income sourced in Tanzania. A fixed tax rate applies to all nonresidents against all employment and other forms of income sourced in Tanzania. Income tax for residents and nonresidents is paid through a pay-as-you-earn (PAYE) system in Tanzania.

Corporate and Employer Tax Obligations

Corporate Tax Rate

Local branches of foreign companies are subject to the company rate of tax. In addition, withholding tax is also payable on all after-tax profits. Because there is no tax treaty between with Tanzania and the United States, there is no exemption from this withholding.

A corporate tax rate may apply. National social security tax, which is shared equally between employers and employees, may also apply.

Tax Residency for a Business

A company or office is deemed resident if it incorporated under the Tanzanian Company Act or maintains a headquarters location within the country. If an office is deemed resident, it will be taxed on its worldwide income. Nonresident offices are taxed only on income sourced in Tanzania. 

Resident companies are also taxed on the undistributed income of controlled foreign corporations and controlled foreign trusts. A "controlled foreign trust" or "controlled foreign corporation" means a nonresident trust or corporation in which a resident person has an interest, whether directly or indirectly, through one or more interposed nonresident entities, and where the person is "associated" (i.e., connected) with the trust or corporation.

For more specific information on the VAT, corporate income and withholding tax, and resident and non-resident individual taxes, please visit the Tax Rates Web site for Tanzania.

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Online Resources Used for This Template

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