When a foreign investor decides to enter an African market, the question is often presented as a straightforward one:

Is the investment permitted?

The legal reality is considerably more complicated. Investment admission sits at the intersection of economic policy, company law, immigration, land regulation, environmental law, taxation, national security and sector-specific regulation. An investor may be welcomed politically but still encounter a series of regulatory gates before it can lawfully operate.

Kenya, Uganda and Tanzania illustrate three different approaches to this problem.

None operates a single, comprehensive foreign-investment screening regime comparable to those found in some major capital-exporting economies. Instead, investment admission is distributed across investment legislation, investment promotion agencies, sectoral regulators, licensing regimes and, increasingly, digital one-stop systems.

This raises a deeper governance question:

Who actually decides whether an investment is suitable for the state, and according to what criteria?

Investment screening and promotion without a comprehensive screening regime

Kenya’s principal investment legislation remains the Investment Promotion Act 2004. The Act is fundamentally facilitative rather than restrictive. It establishes the Kenya Investment Authority (KenInvest) and provides for investment certificates for foreign investors. A foreign investor may apply for an investment certificate where the proposed investment meets the statutory requirements, including the applicable minimum investment threshold and the requirement that the investment and its activities be lawful and beneficial to Kenya.¹

The architecture is therefore not best understood as a classic foreign investment screening mechanism. It is better understood as an investment facilitation and registration system containing elements of regulatory filtering.

KenInvest’s role is particularly important. Its statutory functions include assisting investors to obtain licences and permits, facilitating access to incentives and providing information concerning investment opportunities.² The contemporary digital investment system similarly requires documentation that may include environmental impact assessment documentation, security clearance and health clearance depending upon the project.³

This matters because the investment certificate itself does not replace the regulatory approvals required under other Kenyan laws. An investor may therefore pass the investment-promotion gateway while still being required to satisfy separate requirements relating to environmental protection, land, planning, taxation, immigration, competition, public procurement or sector-specific licensing.

The distinction is important. Investment promotion is not equivalent to regulatory approval. Kenya’s framework consequently disperses screening across institutions rather than concentrating it in a single foreign-investment review authority. This can produce an advantage: specialised regulators retain their substantive mandates. But it can also create fragmentation. The investor experiences several regulatory decisions, while affected communities may experience the consequences of a single project.

That raises an important accountability problem:

Where does responsibility for the overall investment decision actually reside?

The problem becomes particularly significant for investments involving land, infrastructure, energy or natural resources, where the economic desirability of the investment may be assessed by one institution while its environmental and social consequences are assessed elsewhere.

A more explicit investment-licensing model

Uganda provides a somewhat different model.

The Investment Code Act 2019 gives the Uganda Investment Authority (UIA) a much more explicit role in the admission and monitoring of investment. The legislation establishes UIA as a one-stop centre responsible not only for promotion and facilitation but also for coordination, monitoring and evaluation.⁴

A foreign investor cannot simply commence investment activity without registration with the Authority.⁵ This creates a clearer statutory relationship between entry and regulatory supervision.

The Investment Code also imposes continuing obligations on registered investors. These include compliance with Ugandan law, implementation of the approved business proposal, maintenance of financial records, provision of information and permitting the Authority reasonable access to monitor the operation of the investment.⁶

The Ugandan framework therefore moves beyond the idea that the state merely asks whether an investor is financially capable of entering the market. It gives the state an ongoing supervisory relationship with the investment.

This is particularly significant because the Investment Code recognises investments involving “scarce resources”, including mining, petroleum, fishing, forestry and certain tourism activities.⁷ These sectors involve resources that cannot easily be treated as ordinary market commodities. Their exploitation implicates questions of intergenerational equity, land rights, environmental protection and public benefit.

The investment licence can therefore operate as more than an entry document. It can become part of a continuing regulatory relationship between the state and the investor.Yet this creates its own problem.The greater the discretionary authority given to the investment institution, the greater the need for transparent criteria governing its decisions.

The 2024 U.S. Investment Climate Statement notes that Uganda’s Investment Code provides for performance conditions attached to investment licences, including monitoring, employment or training of Ugandan citizens and use of Ugandan goods and services. It also notes uncertainty arising from the government’s ability to alter certain investment thresholds.⁸

The question is therefore not merely whether Uganda screens investments. It is,

How predictable, transparent and reviewable is the screening?

Tanzania: From investment promotion to strategic investment governance

Tanzania has undertaken perhaps the most significant legislative restructuring of the three jurisdictions in recent years.

The Tanzania Investment Act 2022 repealed the 1997 legislation and established a new institutional architecture centred on the Tanzania Investment Centre (TIC).⁹

The Act gives TIC responsibility for coordinating, encouraging, promoting and facilitating investment. It also establishes a National Investment Steering Committee comprising senior government officials, including the Prime Minister, Attorney General, ministers responsible for finance and lands, the Governor of the Bank of Tanzania, the Commissioner General of the Tanzania Revenue Authority and the Executive Director of TIC.¹⁰

This is significant because it moves investment governance beyond the conventional investment-promotion agency model. The National Investment Steering Committee is expressly given oversight functions for large projects of significant national impact, including projects assessed according to size, capital, technological benefits and employment effects.¹¹

Tanzania therefore creates an institutional mechanism through which certain investments can be elevated from ordinary administrative processing into strategic national investment governance.

The Act also distinguishes strategic and special strategic investments and provides additional benefits for qualifying projects. Current criteria include, among other things, capital thresholds, employment creation, technological innovation, export capacity and location in special economic zones or geographically disadvantaged areas.¹²

This creates an interesting paradox.

Strategic investment screening is intended to identify investments that produce exceptional national benefits. But the same criteria that make an investment “strategic” may also increase its social and environmental significance.

A large extractive, infrastructure or energy project may create substantial employment and foreign exchange while simultaneously producing substantial consequences for land, communities and ecological systems.

The legal question therefore becomes:

Does strategic importance strengthen regulatory scrutiny, or does it increase political pressure to facilitate the project?

That is not simply an investment-law question. It is a question of governance.

Three models, three different points of intervention
The comparison can be simplified as follows:

Dimension	Kenya	Uganda	Tanzania
Primary investment institution	KenInvest	UIA	TIC
Principal investment legislation	Investment Promotion Act 2004	Investment Code Act 2019	Tanzania Investment Act 2022
Entry mechanism	Investment certificate	Investment registration/licence	Registration/certificate and facilitation framework
Continuing monitoring	More dispersed across regulators	Expressly embedded in UIA mandate	Expressly embedded in TIC mandate
Strategic investment architecture	More sectorally dispersed	Sector/resource-specific controls	Explicit strategic/special strategic investment framework
One-stop model	Increasingly digital	Strong statutory one-stop model	Statutory electronic integrated investment window

The comparison demonstrates that investment screening is not necessarily a single administrative event. It may be:

a certificate;
a licence;
registration;
sectoral approval;
environmental approval;
land approval;
security clearance;
or a combination of these.
The result is that the legal identity of the “investment decision” becomes fragmented.

The problem of the invisible decision. This fragmentation matters for communities.An affected community may reasonably ask:

But there may be no single answer.

The investment authority may have registered the investor. A sector regulator may have issued a licence. An environmental authority may have approved an assessment. A land authority may have dealt with tenure. A county or local authority may have issued planning or business approvals.

From the perspective of the investor, this may simply be regulatory coordination. From the perspective of an affected community, however, it can become an accountability gap. This is particularly important in investment projects involving land and natural resources. Uganda’s land governance challenges, for example, have been identified as a significant factor affecting investment, with customary land interests creating particular complexity. ¹³

The underlying problem is therefore not that states screen too little or too much. It is that the admission of investment can be separated from the distribution of its consequences.

Kenya, Uganda and Tanzania demonstrate three variations of a broader East African model.

Kenya relies substantially on investment promotion combined with dispersed sectoral regulation. Uganda places greater emphasis on investment licensing, monitoring and continuing investor obligations. Tanzania’s 2022 framework goes further in creating an institutional architecture for strategic investment and centralised coordination.

Yet all three reveal the same fundamental tension. The state wants to attract capital while retaining the ability to regulate it. That tension is not inherently problematic. Indeed, effective investment governance requires both. The real issue is whether investment admission is governed by clear criteria, institutional coordination, procedural transparency and meaningful avenues of accountability.

Ultimately, the question “Who gets to enter?” is only half of the story.

The more difficult question is:

Who gets to decide — and whose interests count when that decision is made?

FOOTNOTES

1. Investment Promotion Act 2004 (Kenya), ss 3–7. The Act establishes the investment certificate mechanism and sets the statutory threshold for foreign investors. (Investment Policy Hub) ↩︎
2. Investment Promotion Act (n 1) s 15. (Investment Policy Hub) ↩︎
3. Kenya Investment Authority, ‘Investment Certificate’, current digital investment portal. (Invest Kenya) ↩︎
4. Investment Code Act 2019 (Uganda), including its establishment of UIA as a one-stop centre for coordination, promotion, facilitation, monitoring and evaluation. (Investment Policy Hub) ↩︎
5. Investment Code Act (n 4) s 19. (Ulii) ↩︎
6. Investment Code Act (n 4) s 18. (Ulii) ↩︎
7. Ibid, definition of “scarce resources”. (Ulii) ↩︎
8. U.S. Department of State, 2024 Investment Climate Statements: Uganda. (State.gov) ↩︎
9. Tanzania Investment Act 2022, Act No 10 of 2022. (OAG MIS) ↩︎
10. Tanzania Investment Act (n 9) ss 4–5. (Investment Policy Hub) ↩︎
11. ibid ↩︎
12. Tanzania Investment Centre, ‘What are the criteria for Strategic investors?’ (Tanzania Investment Centre) ↩︎
13. U.S. Department of State, 2022 Investment Climate Statements: Uganda. (State.gov) ↩︎