UGANDA Law and Practice Contributed by: Onyango Owor, Miriam Babirye Kaggwa and Namugera Joel Peter, Onyango & Company Advocates
tions, 2022, authorise the minister of trade to issue a statutory order prohibiting the export of any class of goods without a licence granted by the Ministry of Trade, Industry and Cooperatives. • Trade in military items, such as guns and explo- sives, is restricted. 5.5 Antitrust Regulations In Uganda, a mandatory notification of takeover offers and business combinations exceeding the following thresholds must be given to the Ministry of Trade, Industry and Cooperatives: • those where the undertakings have a minimum combined turnover or assets of UGX1billion and the turnover (or assets) of the target undertaking is above UGX500million; • those where the turnover (or assets) of the acquir- ing undertaking is above UGX10 billion and the merging parties are in the same market or can be vertically integrated; • those in the carbon-based mineral sector, if the value of the reserves, the rights, and the associ- ated assets to be held as a result of the merger exceeds UGX10 billion; and • those where the undertaking operates in the COME- SA, and meets certain requirements in the Competi- tion Regulations, and two thirds or more of their turno- ver or assets are generated or located in Uganda. Some transactions are exempted from providing such notification, including internal group restructur- ings, acquisitions of minor shareholdings (below 20% without control), and joint ventures that are not fully operational. The notice has to be given by the person acquiring control after the board of directors of the target com- pany has accepted the proposal (merger or acquisi- tion) or after the conclusion of negotiations (acquisi- tion of control), and once the notice has been given, it must be published in a newspaper for 14 days. 5.6 Labour Law Regulations Acquirers in Uganda’s energy and infrastructure sector must comply with the Employment Act Chapter 226 and its regulations, with a key focus on termination proce- dures. This is mostly because mergers and acquisitions
often end with the termination of some employees as a result of redundancy. Notice of termination or payment in lieu of notice is required, together with severance pay. Where the termination involves ten or more employees over three months, the Commissioner of Labour and the employees must be notified. However, the notifi- cation requirement only applies where termination is anticipated; no consultation or disclosure is required to be made pending an M&A transaction. Labour aspects are handled on a case-by-case basis, and as such, it is advisable to seek legal counsel when handling any such matters. 5.7 Currency Control/Central Bank Approval Currency control regulations exist in Uganda. It is a requirement that all payments in foreign currency to or from Uganda between residents and non-residents, or between non-residents, be made through an entity licensed by the Bank of Uganda. Considering that most M&A transactions in the energy and infrastruc- ture sector involve foreign investors, this requirement is generally applicable. In February 2024, Uganda was delisted from the Finan- cial Action Task Force (FATF) grey list as a result of strengthening its efforts to combat money laundering, terrorist financing and proliferation financing. Uganda’s anti-money laundering and control of terrorist financing restrictions require accountable persons (companies) to report and file all their high-value transactions with the FIA. M&A transactions, particularly within the ener- gy and infrastructure sector, are high-value transactions which must be reported for compliance purposes. The central bank (Bank of Uganda) is not required to provide any approval before an M&A transaction. 6. Recent Legal Developments 6.1 Significant Court Decisions or Legal Developments Assessment of Taxes on the Sale of Oil Exploration Rights The High Court of Uganda, in December 2024, made a landmark decision in a legal dispute between Heritage
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