Uganda In Brief

• Published date: 27 July 2022
• Subject Matter: Finance and Banking, Corporate/Commercial Law, Charges, Mortgages, Indemnities, Financial Services, M&A/Private Equity, Contracts and Commercial Law, Securities
• Law Firm: ENSafrica
• Author: &nbsp ENSafrica

Welcome to the first issue of ENSafrica's Uganda in brief, focusing on the latest legal and regulatory updates across Uganda's corporate commercial and banking and finance industries.

corporate and commercial

• Contracting with the government: Parliament of Uganda issues directives on the controversial coffee agreement between the Government of Uganda and Uganda Vinci Coffee Company Limited.
  • On 18 May 2022, the Parliamentary Standing Committee on Tourism, Trade and Industry recommended that government terminate the agreement with Vinci Coffee Company on the grounds that the agreement violates the constitution and several other laws of Uganda. In 2015, the Government of Uganda entered into an agreement with the company for the setup of a plant to add value to Ugandan coffee by making products including soluble coffee.
  • Under the agreement, government gave the company several tax and other incentives and undertook to take reasonable measures ensure that the company had an ample supply of quality coffee.
• Insolvency: The High Court of Uganda highlights rights of secured creditors in insolvency proceedings
  • In the recent case of Bank of India (U) Ltd Vs NC Beverages Limited & Uganda Revenue Authority ("URA"), the High Court reaffirmed the protection accorded to secured creditors by the Insolvency Act, 2011 against preferential creditors in respect to the assets charged by the secured creditor. In this case, the High Court faulted the URA for seizing and disposing of assets that were subject to a registered charge.
• Doing business in Uganda: The High Court issues a decision requiring foreign partnerships to register in Uganda in order to conduct business in the country
  • The High Court, in the recent decision of Vantage Mezzanine Fund II Partnership Vs Uganda Registration Services Bureau and others, declined to grant standing to sue to a South African partnership on grounds that it did not register in Uganda under Ugandan law. Vantage Mezzanine Fund had lent over USD10-million to a Ugandan business and was seeking to enforce recovery. The decision is under review but appears flawed.
  Non-governmental organisations: High Court overturns the decision of the National Bureau for Non-Governmental Organisations ("NGO Bureau") to indefinitely suspend an NGO's permit
  • The High Court has ruled, in the case of Chapter Four Uganda Vs National Bureau of Non-Governmental Organisations, that the actions of the NGO Bureau to indefinitely and without a specific timeframe...