The Bill was re-tabled in the 11th Parliament and considered again by the Finance Committee. In a report presented to Parliament, Keffa Kiwanuka, the Committee Chairperson recommended to MPs that the oil, gas, and petroleum sector should be excluded from the implementation of the law since it is unique.
has approved the National Local Content Bill, 2022. The private member's Bill by Kassanda North
MP, Patrick Nsamba Oshabe was passed on Tuesday.
The Bill was first tabled before Parliament in January 2019 during the Tenth
Parliament, processed, and eventually passed. Its objective was to impose local
content obligations on persons or entities using public money or utilizing
Uganda’s natural resources or carrying out activities requiring a licensee; to prioritize
Ugandan citizens, Ugandan and resident companies in public procurement.
Nsamba then said that the Bill is aimed at increasing the consumption of local
products and increasing the participation of local firms in domestic trade. He
added that the lack of protection of local manufacturers and the non-imposition
of obligations on foreign investors to use Ugandan labor and the
non-implementation of the Buy Uganda Build Uganda policy, exposed Ugandan
manufacturers to unfair competition.
However, President Yoweri Museveni declined to assent to it and returned it to
parliament on 18th August 2020, citing provisions that would put Uganda on a
parallel course with the international community.
President Museveni among others cited section 4 of the Bill that tasked a local
content entity to give preference to goods that are manufactured in Uganda as
well as services that are provided by Ugandan entities.
"The Bill is in conflict with the East African Monetary Union. Under
Article 13 of the Customs Union Protocol, the EAC partner states agreed to
remove all existing non-tariff barriers to trade and not to impose any new
ones," said Museveni in his letter to the Speaker.
The President also expressed reservations about enacting a Local Content
Department under the Minister for Finance, in a bid to implement the law.
"It is not feasible for one department to approve local content
plans from bidders, for each individual procurement for the whole
country," the President further stated in his letter.
The Bill was re-tabled in the 11th Parliament and considered again
by the Finance Committee. In a report presented to Parliament, Keffa Kiwanuka,
the Committee Chairperson recommended to MPs that the oil, gas, and petroleum
sector should be excluded from the implementation of the law since it is unique.
He said that this particular sector is characterized by long years of
capital expenditure without realizing a profit, cost monitoring activities, and
budget activities which require a stable legal regime to ensure consistency,
predictability, and stability.
also told parliament that the government had already incorporated provisions of
local content in the different laws concerning the oil, gas, and petroleum sector.
Parliament adopted the committee recommendation after the Minister of State for
Finance, Henry Musasizi, and Speaker Anita Among emphasized that the law should
not contradict the already existing laws.
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Parliament also agreed to designate the functions of the department responsible
for local content as the department for Procurement Policy and Management under
the Ministry of Finance, Planning and Economic Development.
The role of developing and applying local content plans is to be left to
the various Procurement and Disposal Units under Ministries, Departments, and
Agencies to ensure that efficiency in the procurement process is not
MPs also agreed that government integrates the development of
cooperatives in its local content promotion strategy and BUBU Policy.
that the law will go a long way in ensuring Ugandan products are consumed
and the involvement of local firms. Nsamba says that the country loses a lot of
money that is repatriated by foreign investors and companies which are
dominating the development contracts.