Tanzania's Minister of Minerals, Anthony Mavunde, has directed the Mining Commission to investigate the legitimacy of shares owned by Tanzanians in foreign companies providing mining services. The probe will be conducted in collaboration with relevant authorities, including the Business Registration and Licensing Agency (BRELA) and the Tanzania Revenue Authority (TRA). This move aims to ensure compliance with the country's mining laws.
According to Minister Mavunde, Section 133 and Section 135 of the Mining Act provide mandatory requirements for every license holder to ensure the use of Tanzanian products and services. If a service is not available in Tanzania, the license holder must ensure that a foreign entity entering into an agreement with a Tanzanian has a minimum of 20% shareholding. This requirement is intended to enable Tanzanians to participate directly in the mining sector's value chain.
The minister expressed concern that despite the existence of this regulation, some individuals have resorted to falsifying ownership of shares in service-providing companies within the mining industry. Preliminary reports have revealed that some investors have forged documents or nominally allocated 20% shareholding to Tanzanians, contravening the law. The government aims to eliminate such malpractices to maintain the integrity of the sector.
Minister Mavunde emphasized that the government's objective is to ensure Tanzanians benefit from the mining sector through various business opportunities and services. He stressed the need for transparency and compliance with regulations to maintain public trust in the sector. The minister's directive is part of the government's efforts to reform the mining industry and ensure that Tanzanians reap the benefits of their natural resources.
Geita Regional Commissioner, Alexander Mnyeti, supported the minister's directive, highlighting the need for swift action to address the issue of Tanzanians involved in falsifying share ownership. Mnyeti noted that such malpractices deny Tanzanians opportunities to participate in the sector. The government has urged stakeholders to cooperate with the investigation and ensure compliance with the regulations.
The Mining Commission will work closely with relevant agencies to verify the ownership of shares in mining companies. The investigation will focus on ensuring that foreign companies operating in Tanzania comply with the 20% shareholding requirement for Tanzanian shareholders. This move is expected to increase transparency and accountability in the mining sector.
The probe is part of the government's efforts to maximize benefits from the mining sector for Tanzanians. The sector is a significant contributor to the country's economy, and the government aims to ensure that its resources are harnessed sustainably and equitably. The investigation's outcome is expected to inform policy decisions and regulatory reforms in the sector.
Key points
- The Tanzanian government has ordered an investigation into the ownership of mining companies to ensure compliance with regulations requiring Tanzanian shareholders.
