Uganda WT/TPR/S/93
Page 31
III. TRADE POLICIES AND PRACTICES BY MEASURE
(1) INTRODUCTION
1. Tariffs have become the main trade policy instrument in Uganda.  A strong emphasis on
liberalization within the economy has also affected trade policy, including the elimination of all
quantitative restrictions.  Most non-tariff restrictions still in force are maintained for moral, health,
security, and environmental reasons.  Tariff protection in Uganda has been reduced since its previousTrade Policy Review in 1995.  The number of bands carrying ad valorem  rates has been reduced from
five to three (0, 7% and 15%), and maximum ad valorem  rates have been lowered from 60% to 15%.
2. The simple average of Uganda's applied MFN 2000/01 tariff is 9%, and tariff escalation is
mixed.  An import licence commission of 2% and a withholding tax of 4% are collected on all
imports.  This raises the average rate of import duties to 15%.  The excise duty is 10% on almost allgoods (imported or locally produced), with the exce ption of cigarettes (130%), alcoholic beverages
(70%) and soft drinks (15%).  Special protection exists for sugar and textile industries.  A value-added
tax of 17% applies to most goods, imported and domestically produced, with the important exception
of unprocessed agriculture products.
3. Uganda has been applying the customs valuation method based on the transaction value since
July 2000.  The adoption of the transaction value has contributed to the elimination of preshipment
inspection requirements on imports.  However, minimum import prices are maintained on used goods,
textiles, tiles, batteries, and safety matches.
4. Uganda maintains no export duties except a 1% cess collected on coffee exports.  The major
incentive programmes are a fixed duty drawback scheme and a manufacturing under bond scheme.
Duty and tax concessions are also granted to local manufacturers.  Various export promotion
programmes exist, some of them only recently created.  Uganda has continued its privatizationprogramme, and almost three fourths of all public enterprises have been either divested, closed or
liquidated;  the programme is continuing.  Except for few areas, such as rail transport and postal
services, no state-owned companies maintain monopoly positions that affect trade.
5. New regulations on public procurement were adopted in 2000;  open tendering procedures are
generally preferred.  The Government is amending its laws on anti-dumping and countervailingmeasures, on sanitary and phytosanitary measures, and on intellectual property, with a view to
aligning them on the relevant WTO Agreements.  Uganda does not yet have legislation on
competition;  the Government is considering this.
(2) M
EASURES DIRECTLY AFFECTING IMPORTS
(i) Procedures
6. All traders in Uganda, whether engaged in local or international trade, must be registered with
the Ministry of Justice and licensed by the competent local authorities.  Applicants for registration and
licensing must produce a Taxpayer Identification Number (TIN) from the Uganda Revenue Authority
(URA);  the TIN is intended to improve tax administration.1  No special registration or licence is
required to import.
                                                     
1 WTO (1995).WT/TPR/S/93 Trade Policy Review
Page 32
7. Preshipment inspection (PSI) is no longer required on goods imported to Uganda.  The
removal of preshipment inspection requirements followed Uganda's adoption of the transaction value
for customs valuation purposes.  Up to June 2001, preshipment inspection was used as a guide to the
value of goods and was compulsory for imports over US$5,000.2  The inspection was carried out by
Intertek Testing Services (ITS) in the country of origin.  The ITS preshipment inspection covered
verification of the quality, quantity, and price of the goods shipped.  A PSI fee of 0.8% of the f.o.b.value of the goods was paid by the importer.  At a later stage, post-import audit exercises were carried
out by the Customs Department on consignments of "high revenue risk", i.e., goods subject to high
import duties and prone to smuggling.  The fine for not submitting a Clean Report of Finding (CRF)
was 3% of the f.o.b. value of the goods in question.
8. With the exception of international organizations, large importers, and importers of perishable
goods, all importers are required to use the services of licensed clearing agents and to file a
report/declaration at the Customs point of entry.  The report/declaration (for imports and exports) is
made on a standard Customs bill of entry.
3  Goods destined for clearance inland are first declared in a
road customs transit declaration at the point of entry, for purposes of determining a bond in force,
which is secured by a bond guarantee.  Although the bill of entry is a standard document coveringvarious regimes, the distinguishing features are the customs procedure codes (CPCs) depending on the
nature of the transaction (home-use goods, ex-warehousing, re-importation, export, re-export,
temporary importation, warehousing, and transit/bond removals).
9. Since 1995, the following computerized procedures have been introduced:
- convoy data system, which enables data capture and monitoring of cargo destined
inland and of transit goods.  Another component of the system is currently under
implementation on a trial basis;
- ASYCUDA, which is an automated system that enables declaration, document check,
assessment and payment processing.  ASYCUDA is used at these customs
destinations: Entebbe, Kampala Longroom, Railway Goodshed, Jinja, Busia, Malaba,
Tororo, Mbale and Mbarara.
Other sub-programmes are being developed and tested to cater for warehousing and transit
transactions.
10. The Ugandan authorities indicate that the time taken for clearance of imported goods in
Customs averages three days from the time of lodging an entry in the longroom, depending on proper
declaration of the goods.  Since the 2001/02 Budg et, the Uganda Commercial Bank no longer has a
monopoly over the collection of tax revenue;  this is expected to speed-up the process.
11. Delays, bureaucracy, and corruption are reported to be a source of concern both for exporters
and importers.  They add enormously to transaction costs for traders.  Most of the concerns in this
area are about tax administration.  Conditions at Bu sia and Malaba are of particular concern in this
regard.  Handling costs at Entebbe Airport are made artificially higher by the handling monopoly, but
the Government is considering allowing competition there.  Parking facilities for the large number ofgoods vehicles held up at Malaba are inadequate, and vehicles are often stuck for weeks in unpaved,
                                                     
2 The limit was US$10,000 at the time of the last TPR of Uganda.
3 Other forms acceptable are Form C20 (declaration of personal and accompanied baggage), Form C21
(declaration of release of perishable/urgent goods), and Form F88 (accompanied goods of a total c.i.f. value of
US$1,000 or less).Uganda WT/TPR/S/93
Page 33
water-logged parking areas.  The Government pledged in its 2001 Budget Framework Paper that
"every possible step will be taken to ensure that exports get through borders quickly at the lowest
possible cost."4
(ii) Tariffs, other duties, and charges
(a) General features
12. Goods imported into Uganda may be subject to customs tariffs, an import licence
commission, a withholding tax, and to internal taxes, i.e. excise duties and the value-added tax (VAT),
which apply equally to imports and domestic products.  Excise duties apply to selected goods.  The
EAC is in the process of harmonizing internal taxe s, including excise duties, in member countries.
Special protection is accorded to the sugar and textile industries.
13. Customs duties are applied on the c.i.f. value of imports.  Internal taxes are applied on the
customs value of imports, inclusive of import duties, and on ex-factory prices of locally produced
goods.  Government revenue from border charges accounts for 5.8% of total tax revenue.
14. Proposals for changes in the tariff structure and other import charges are made by the Minister
of Finance, Planning and Economic Development in consultation with all the stakeholders both in the
public and the private sectors.
(b) Nature and level of MFN duties
15. Uganda accords at least MFN treatment to all trading partners.  It adopted the Harmonized
System (HS) nomenclature in 1993.  Since its last TPR in 1995, Uganda has continued to simplify the
structure of its tariff.  In fact, the number of bands has been reduced from five to three, and the
maximum rate lowered from 60% to 15%.5  The 2000/01 applied tariff has 5,161 lines at the
HS six-digit level, and three bands:  zero, 7% and 15%.  All tariffs are ad valorem , except on fuel.
16. The simple average rate of Uganda's applied MFN 2000/01 tariff is 9%, with a standard
deviation of 5.4% (Table AIII.1).  The coefficient of variation is 0.6;  it depicts a moderate dispersion
of tariff rates from one category of products to another.  The modal rate (the rate occurring most
frequently) is 7%;  it applies to 44.3% of all tariff lines (Chart III.1).  Except for this modal rate, the
maximum rate of 15% applies to the highest number of tariff lines (39.3% of all lines), and to a wide
variety of products ranging from agricultural goods  to manufactured products (Table AIII.1).  The
zero rate applies to 16.4% of all tariff lines;  duty-free items include fertilizers;  insecticides,
fungicides, herbicides and disinfectants;  specified products of the printing industry;  certain tubes and
pipes;  fuels for specified uses;  pharmaceutical products;  specified nuclear reactors, boilers,
machinery, and mechanical appliances, and parts thereof;  specified electrical machinery and
equipment and parts thereof;  railway or tramway locomotives;  certain purpose motor vehicles;specified aircraft, spacecraft, and parts thereof;  certain ships, boats and floating structures;  specified
medical equipment and tools;  and electricity.
                                                     
4 Ministry of Finance, Planning and Economic Development (2001a).
5 The Government recognizes that tariff protection of local industries reduces the competitiveness of
export industries by shifting economic incentives from exports to import substitutes.  The longer domestic
industries are protected through, for example, import tariffs, the harder it would be to develop a dynamic export
sector and reduce dependence on coffee, MFPED (2001a), p. 18.WT/TPR/S/93 Trade Policy Review
Page 34
(39.3)(44.3)
(16.4)
05001,0001,5002,0002,5003,0003,500
Duty free 7 15
Figures in parentheses indicate the share of total lines (in percentage).
WTO Secretariat estimates, based on data provided by the Ugandan authorities.Chart III.1
Applied MFN tariff distribution, 2000/01
Number of tariff lines
Note:
Source :
17. Agriculture (including hunting, forestry and fishing) is the most protected sector (ISIC
Revision 2 definition) with an average tariff rate of 11.2%, followed by manufacturing (8.9%), andmining and quarrying (8.8%).  The 7% rate applies to the largest share of mineral products, and the
15% rate to the largest share of agricultural goods (Chart III.2).  Using the WTO definition,
agriculture remains the most protected sector, with a simple average tariff rate of 12.4%;  in this case,
the simple average tariff rate on non-agricultural products is 8.5%.
18. Uganda's 2000/01 applied MFN tariff generally displays negative escalation from first-stage
processed goods (average tariff of 10.6%) to semi-finished products (average tariff of 8.7%), and
positive escalation from semi-finished to finished goods (mean tariff rate of 8.8%).  Tariff escalation
is positive on manufacture of food, beverages and tobacco;  wood and wood products, including
furniture;  and paper, paper products, printing and publishing.  Tariff escalation is mixed on almost all
other categories of products (Table III.1).  Further breakdown of the tariff lines (from the ISIC
Revision 2, two- to three-digit level) depicts pronounced positive escalation on miscellaneous
petroleum products, with mean rates ranging from 8.6% on the first stage of processed goods to 15%on finished products;  on leather products (except footwear and wearing apparel), with average rates
ranging from 7% on the first stage to 14.2% on finished products.  Other groups showing positive
escalation are wood and wood products, except furniture;  paper products;  and other chemicals,
including pharmaceuticals.Uganda WT/TPR/S/93
Page 35
Total
Industry
Mining
AgricultureDutyfree
7
1501020304050607080Chart III.2
MFN tariff distribution by sector, 2000/01
Source : WTO Secretariat estimates, based on data provided by the Ugandan authorities.Percentage
19. Uganda's tariff bindings cover 15.4% of all its tariff lines:  all tariff lines for agricultural
products (like other WTO Members), and 2.7% of total lines for non-agricultural products (WTO
definition).  The bindings are at ceiling rates of:  80% on most agricultural products, except for
60 tariff lines with bound rates varying between 40% and 70%;  and between 40% and 80% onnon-agricultural products, including fisheries products, photographic goods, rubber, and certain
machinery.  Other duties and charges on all these products are bound at zero.
Table III.1
MFN tariff escalation by ISIC 2-digit categories, 2000/01
(Per cent)
Code DescriptionNumber
of linesSimple
averageRangeStandard
deviation
Total 5,161 9.0 0-15 5.4
-1st stage of processing 628 10.6 0-15 4.2
-semi-processed 1,679 8.7 0-15 3.6
-fully processed 2,854 8.8 0-15 6.4
11 Agriculture and hunting
-1st stage of processing 213 11.0 0-15 4.4
12 Forestry and logging
-1st stage of processing 27 7.0 7-7 0.0
13 Fishing
-1st stage of processing 49 14.7 7-15 1.6
21 Coal mining
-1st stage of processing 4 7.0 7-7 0.0
Table III.1 (cont'd)WT/TPR/S/93 Trade Policy Review
Page 36
Code DescriptionNumber
of linesSimple
averageRangeStandard
deviation
22 Crude petroleum and natural gas production
-1st stage of processing 3 9.7 7-15 4.6
23 Metal ore mining
-1st stage of processing 23 7.0 7-7 0.0
29 Other mining
-1st stage of processing 75 9.3 7-15 3.7
31 Manufacture of food, beverages and tobacco
-1st stage of processing 83 12.7 0-15 3.8
-semi-processed 64 13.8 0-15 3.2
-fully processed 302 13.9 7-15 2.7
32 Textile, wearing apparel and leather industries
-1st stage of processing 38 12.7 7-15 3.7
-semi-processed 412 11.4 7-15 4.0
-fully processed 430 14.2 0-15 2.5
33 Wood and wood products, including furniture
-1st stage of processing 5 10.2 7-15 4.4
-semi-processed 33 14.8 7-15 1.4
-fully processed 48 14.8 7-15 1.2
34 Paper, paper products, printing and publishing
-1st stage of processing 19 7.0 7-7 0.0
-semi-processed 67 8.0 7-15 2.6
-fully processed 61 9.9 0-15 5.4
35 Chemicals, petroleum, coal, rubber, plastics
-1st stage of processing 56 8.0 0-15 3.3
-semi-processed 705 7.1 0-15 2.1
-fully processed 298 9.3 0-15 5.4
36 Non-metallic mineral products except of petrol. & coal
-1st stage of processing 2 15.0 15-15 0.0
-semi-processed 32 11.5 7-15 4.0
-fully processed 130 13.0 0-15 3.8
37 Basic metal industries
-1st stage of processing 16 7.0 7-7 0.0
-semi-processed 356 7.2 0-15 2.3
-fully processed 1 7.0 7-7 0.0
38 Fabricated metal products, machinery & equipment
-semi-processed 6 11.0 7-15 4.4
-fully processed 1,394 4.9 0-15 5.9
39 Other manufacturing industries
-1st stage of processing 15 13.9 7-15 2.8
-semi-processed 4 7.0 7-7 0.0
-fully processed 189 11.6 0-15 4.1
40 Electricity 1 0.0 0-0 0.0
Source: WTO Secretariat calculations, based on data provided by the authorities of Uganda.Uganda WT/TPR/S/93
Page 37
(c) Tariff preferences
20. Uganda grants preferential treatment in the form of duty reductions, on a reciprocal basis, to
other members of COMESA, subject to a certificate of origin.  Capital goods and raw materials are
duty free;  intermediate goods imported from the ot her COMESA countries are subject to a 4% tariff,
while imports of similar products from non-COMESA countries are subject to a rate of 7%.  Finished
goods enter at a 6% rate for COMESA  products and 15% for non-COMESA products
(Chapter II(5)(iii)(a)).
21. Under the framework of the East African Community (EAC), preferential tariff treatment is
also to be granted by Uganda to other members – Kenya and Tanzania – by 2004
(Chapter II(5)(iii)(b)).  The details are still to be negotiated.
(d) Other duties, levies, and charges
22. Special protection is provided to the sugar and textile industries.  However, details of the
protection have not been provided to the WTO Secretariat.
23. An import licence commission of 2% of the c.i.f. value, and a 4% withholding tax are
collected on all imports to Uganda, irrespective of their source, final use, and value.  The import
licence commission is collected by the Customs Department on behalf of the MTTI.  The withholdingtax has been waived on all imported raw materials.
24. There is an excise duty of 10% on imports and locally produced goods, except for cigarettes
(130%), alcoholic beverages (70%) and soft drinks (15%) and mineral water (10%).  In 1999/2000,
18% of revenue from excise duties came from imports.
6  Except for a number of items under the
general description of "woven fabrics of artificial staple fibres, containing 85% or more by weight of
artificial staple fibres", most textiles are not subject to excise duties.
25. A value-added tax is levied at a standard rate of 17% on the sale price of locally produced
goods and services, and on the customs value of imports, inclusive of duties.  Unprocessed
agricultural products are exempted.  In 1999/2000, 52% of the revenue collected under VAT came
from imported goods.
(e) Duty and tax exemptions and concessions
26. In principle, exporters have access to VAT refunds and duty drawback, but the refund
mechanisms have suffered from a number of shortcomings.  The Uganda Government, in
collaboration with the World Bank, carried out a study on how best to improve the duty drawback
system and to remove the implicit taxation of exports generally.  Based on the recommendations of
that study, the Government introduced two new schemes on 1 July 2000 – the Fixed Duty Drawback
Scheme and the Manufacturing Under Bond Scheme– intended to be more user-friendly.
27. The Fixed Duty Drawback Scheme operates on input/output coefficients already calculated in
advance or estimated on the basis of information provided by the exporter.  Under this mechanism
duties paid on inputs that go into the production of exports are refunded so that the export is not
rendered uncompetitive as a result of the duties.  It may apply equally to packaging materials for
exported goods.  The scheme is intended to meet the needs of the exporters of agricultural and fisheryproducts and manufactured goods who do not rely on a large quantity of imported inputs, especially
                                                     
6 Ministry of Finance, Planning and Economic Development (2001a), p. 13.WT/TPR/S/93 Trade Policy Review
Page 38
packaging materials.  The scheme is based on documentary requirements;  various forms must be
completed.  An interested exporter must register with the Duty Drawback Division in the Large
Taxpayers Department of the Uganda Revenue Authority.
28. The Manufacturing Under Bond Scheme is intende d to meet the immediate need of the 100%
export companies.  Under Section 42(1)(b) of the Customs Management Act, the Commissioner
General of Customs is authorized to permit the assembly or manufacture (in the warehouse) of anyarticle.  For this purpose, the Commissioner General may permit the receipt into a warehouse of
duty-free imports or local products required as components of the article to be so assembled or
manufactured therein.  To qualify for the scheme, the manufacturer must, inter alia:  be VAT
registered;  be approved and licensed by the MTTI as a manufacturer;  be a member of the Uganda
Manufacturers Association;  possess a Clearance Certificate/Permit from the respectiveMinistry/Department on the products to be manufactu red;  conform to conditions laid down by the
Uganda National Bureau of Standards;  and have a licensed Customs Factory Bonded Warehouse.
For purposes of manufacturing under bond, "raw material" (input) means any product, processed or
not, and "output" implies substantial transfor mation leading to change in the HS Code.
7
29. To encourage local production of textbooks, import duties (tariffs and taxes) on raw materials
are refunded or credited when proof is shown that the materials were used in the production of
textbooks.8
30. There is no customs duty on goods in transit;  bonds must be held until the goods leave the
country.  The Customs Administration has gradually reduced the time allowed for goods shipped
through Uganda on their way to, inter alia,  eastern Congo and Rwanda;  the current time allowed is
up to seven days.
31. The following exemptions from import duties and VAT are in force:  goods for use by the
President;  goods imported by diplomatic missions and diplomats, including those associated with a
first arrival in Uganda;  certain goods for disabled persons;  certain used personal effects;  samples
and miscellaneous articles imported as merchandise, which, in the opinion of the
Commissioner-General have no commercial value;  ambulances, prison vans, and hearses;  mosquito
nets and material for the manufacture of mosquito nets;  certain seeds for sowing; inputs for themanufacture of agriculture equipment;  certain packing materials;  specified passenger baggage;
certain motor vehicles that have been specially adapted for use in safari parks, but not including
saloon cars;  and specialized covering sheets for horticulture.  Goods generally used by Government
are not duty free.
32. According to the 2001/02 Budget Speech, Government intends to amend the Customs Law to
remove ministerial discretion in the granting of exemptions, bringing it in line with the VAT and
income tax laws.
(iii) Customs valuation
33. Since July 2000, customs valuation has been based on the transaction value as provided for by
the WTO Agreement on Implementation of Article VII of GATT 1994.  The sequential process usedby Uganda for valuation purposes is:  step 1, the transaction value based on the invoice;  step 2, the
transaction value of identical goods;  step 3, the transaction value of similar goods;  step 4, the
deductive value based on a price on the open market, less tax, costs, and profit;  step 5, a computed
                                                     
7 Any person who contravenes any conditions under this scheme is liable to forfeiture.
8 Ministry of Finance, Planning and Economic Development (2000a), p. 35.Uganda WT/TPR/S/93
Page 39
value based on total production cost, relying on the manufacturer;  and step 6, a fall-back where some
of the conditions in steps 1 to 5 above are relaxed.  Minimum import prices are set are used goods,
textiles, tiles, batteries, and safety matches.  In cases of undervaluation, correct values are given, and
an offence file is opened.
34. There is a specific procedure for valuation appeals.  The importer/agent appeals to the head of
station where the value was given.  The head discusses the issue with the valuation officer, and, if thedecision does not satisfy the importer/agent, he can a ppeal to the officer in charge of the region who is
at the level of Assistant Commissioner.  There is still a right to appeal to Headquarters, where it is
referred to the valuation section.  The final stage is the Tax Appeals Tribunal.  A similar process
applies to classification and interpretation appeals.
35. The Tax Appeals Tribunal was established under an Act of Parliament in 1999 (The Tax
Appeals Tribunal Act of 1997);  its major role is ta x litigation.  Fifty-two cases have been heard since
its inception.  Of the 52, the Uganda Revenue Authority has won 18 cases, eight cases were
withdrawn, ten were settled, ten were lost (one was settled on appeal), one case was struck out, one
was withdrawn pending a re-audit, and four cases are pending a hearing.
(iv) Rules of origin
36. One of the documents required for customs purposes is the certificate of origin.  Uganda has a
tiered tariff system in which the origin of the goods is considered.  Regional trade agreements in
which Uganda participates, such as COMESA, and arrangements for non-reciprocal preferential
treatment to which Uganda is a beneficiary, provide for rules of origin criteria (Chapter II(5)(iii)).
37. Uganda has no legislation on non-preferential rules of origin.
(v) Import prohibitions, restrictions, and licensing
38. Import licensing has been abolished except for items in a "negative list".  This negative list
comprises used tyres, firearms, pornographic materials, and imports banned under international
agreements of which Uganda is a signatory.  To import any of the above items, prior authorization
must be obtained from the Minister for Tourism, Trade and Industry.
39. Approval must be sought from the Agricultural Chemicals Control Board for agri-chemicals
and from the National Drug Authority for pharmaceuticals.  Importers of agricultural chemicals mustapply to register with and be certified by the Agricultural Chemicals Board, under the Agricultural
Chemicals (Regulations and Control) Regulations 1993.  Similarly, importers of pharmaceutical
products must apply to the National Drug Authority for registration and certification, under the
National Drug Policy and Authority Statute of 1993.
40. For all other imports, automatic licences are granted.  The importer must complete a single
bill of entry for all regimes, i.e. home use, warehousing, temporary importation, re-importation, and
transit.
9
41. The Uganda Revenue Authority may require supp lementary documents at the entry point for
the import of certain goods.  For human and animal  drug medications, "verified" pro-forma invoices
from the Pharmacy Board are needed.  A firearms certificate is required for imports of firearms;  and ahealth certificate is required for live animals (domestic and wild).  For wild endangered species,
                                                     
9 Ministry of Finance, Planning and Economic Development (2000a), p. 3.WT/TPR/S/93 Trade Policy Review
Page 40
permission of the national Management Authority for the Convention on International Trade in
Endangered Species of Wild Fauna and Flora (CITES) must be obtained.  A fumigation certificate is
necessary for second hand clothing.  For explosives, permission of an approval authority is required.
For seeds and plants, a phytosanitory health certificate is required.  The approval of the Uganda
National Bureau of Standards (UNBS) may be requi red to import food products, and a certificate to
that effect.
(vi) Contingency trade remedies
42. Uganda's Customs (Dumping and Subsidies) Act of 1964 provides the current legal
framework for anti-dumping and countervailing measures.  Reform of that legislation is under way.10
The 1964 Act, which dates back to the former East African Community (EAC), Chapter II(5)(ii),deals only with dumped or subsidized imports from outside "the Partner States", i.e. Uganda, Kenyaand Tanzania.  The President of a Partner State may, subject to a public-interest clause, impose an
additional duty on "dumped or subsidized" imports that cause, or threaten to cause, material injury to
an established industry;  the relevant rate is to be determined by the President or the Minister of Trade
and Industry.
11  The Act explicitly requires that any such action be in conformity with the members'
obligations under the GATT.
43. While no measures were taken under these provisions for over 15 years, Uganda levied a
surtax during 1993/94 on a range of imports from Kenya (an EAC member).  No similar special taxes
have been levied for this purpose since 1995.
44. The COMESA Treaty bans dumping practices that cause, or threaten to cause, material injury
to an established industry in a member State.  To counteract infringements, anti-dumping duties may
be imposed at a level not greater than the dumping margin.  Subsidies are considered "incompatible"
with the Common Market if they distort or threat en to distort competition and affect intra-COMESA
trade.  Countervailing duties may be levied subject to the same criteria and constraints as above.
Offsetting duties may also be imposed on dumped or subsidized imports from third countries.  The
member States are held to cooperate in detecting and investigating dumping and subsidy practices and
imposing remedial measures.
45. According to the authorities, Uganda has no specific safeguard legislation corresponding to
Article XIX of the GATT.  The Government intends to initiate such legislation on the basis of the
Uruguay Round Agreement on Safeguards as part of the reform mentioned above.
(vii) Government procurement
46. Until September 2000, public procurement took place under the jurisdiction of a Central
Tender Board.  It is now decentralized and is self-contained within each procurement entity.Procurement entities have de facto Chief Executive Officers who are responsible for all matters of
procurement in their entities, but can delegate decision-making to procurement contract committees.
Such committees have secretariats that prepar e documentation for the contract committee, and
                                                     
10 Ojakol (2001), p. 5.
11 "Dumping" is defined as exporting goods at lower than "the fair market price" in an exporting
country.  The "fair market price", in turn, is determined on the basis of (a) the home market price or, in theabsence of such a price, (b) the export price of identical or comparable goods or (c) the actual or estimated costof production (with additions for selling cost and profit).  "Subsidies" are defined as direct or indirect support
for the production or export of goods, whether through grants, loans or tax relief.  The investigation is to be
carried out by the Commissioner-General of Customs.Uganda WT/TPR/S/93
Page 41
manage the day-to-day procurement process.  In parallel, a reformed Central Tender Board (CTB)
manages the regulatory framework, and monitors and evaluates compliance by all procurement
entities.  The new system places an emphasis on transparency and delineates acceptable and non-
acceptable behaviour both of contracting officers and entities interested in procurement contracts.12
47. The preferred procurement procedure is the open tendering system, especially for large
amounts of public purchases.  The tender is advertised in the national, and in some cases international,print media requesting for bids.  The bids are opened, registered, and evaluated by the tender
committee in each procurement entity, using the availa ble technical expertise within the entity.  Local
and regional authorities and public enterprises foll ow the same procedure.  SWIPCO, a U.S. based
company, is currently responsible for auditing all procurement of US$50,000 and above by Ugandan
ministries and parastatals.
13
48. The other authorized procedures, each with specific conditions, are:  restricted tendering,
direct procurement, procurement by requests for proposals, and request for quotations.  Restricted
tendering may be authorized when the goods, works or services are available only from a limited
number of suppliers or when the time and cost required to examine and evaluate a large number of
tenders would be disproportionate to the time available in an emergency situation or to the value ofthe expected procurement (up to U Sh 100 million or US$60,000).  Direct procurement may be used
in various situations, including:  due to absence of competition for technical reasons, the goods,
works, or services can be supplied only by one prospective tenderer;  when there is an urgent need for
the items;  when there is need for additional items from an original supplier;  in cases of new works
consisting of repetition of previous works from a supplier;  for purchase of perishable items on market
terms;  or when the contract price does not exceed U Sh 100,000 or US$60.  A procuring entity may
engage in procurement by means of requests for proposals when it seeks to obtain consulting servicesor combinations of goods or services for which open or restricted tendering is not suitable because of
the difficulty in defining the services.  Procurement by means of request for quotations applies to the
purchase of readily available goods or for the procurement of works or services for which there is an
established market, and within a threshold of U Sh 5 million or US$3,000.  Procurement bodies must
provide annual reports to the CTB on use of procedures other than open tendering.
49. The CTB is composed of a Chairperson and up to six non-executive members appointed by
the Minister of Finance, Planning and Economic Development supported by an Executive Director
selected on competitive basis, it has tenure of four years.  The CTB prepares standard documents to be
used in connection with public procurement;  issues general guidelines, and gives advice and
assistance to procuring entities;  organizes the system for publication of tendering opportunities andthe results of public procurement proceedings;  drafts annual reports for the Cabinet on the overall
functioning of the procurement system;  inspects the records of procurement entities to the extent
appropriate in order to check on the proper application of the Regulations of those entities;  and
performs other functions.
50. The WTO Secretariat is not aware of the abolition of preferential margins (of 15% to 20% for
goods and 5% to 7% for services) accorded to local suppliers over imports.
14  Projects funded by
foreign/international institutions are subject to their own criteria and thresholds.  Data on public
procurement are not available.
51. Uganda is not a signatory to the Plurilateral Agreement on Government Procurement.
                                                     
12 Statutory Instruments 2000 No. 62, The Public Finance (Procurement) Regulations, 2000.
13 United States Department of Commerce (2000), Chapter IV, p. 2.
14 WTO (1995).WT/TPR/S/93 Trade Policy Review
Page 42
(viii) Other measures
52. Uganda implements the UN Security Council resolutions as in the case of, inter alia,  the
Democratic Republic of Congo and Angola.  Countertrade is not practised in Uganda.
53. Uganda maintains strategic reserve-stock requirements on maize, beans, peas, and sorghum
(Chapter IV(2)(i)).  There are no requirements for insurance for imports.  Uganda has no agreements
with foreign countries designed to influence the quantity or value of its imports.
54. According to the authorities, Uganda has no local-content requirements for duty concession
purposes.
(3) MEASURES DIRECTLY AFFECTING EXPORTS
(i) Procedures
55. As a function of Uganda's commitment to a liberal trade policy, the emphasis has been on
ensuring that the export sector remains as open as possible.  Registration and documentation
requirements for exporters are minimal.  Export enterprises are required to have a certificate of
registration, a trading licence, and a tax identification number (TIN).  On presentation of these
documents to the MTTI, the exporter is issued with an application form for export permit.  The cost of
the form is U Sh 1,500;  the export permit is issued within 24 hours.
56. An exporter may, depending on the export product, also require other documents, such as
phytosanitory certificate, certificate of origin, veterinary health certificate, certificate of analysis
(government chemist), packing list, commercial invoice, and Customs document 3 (CD3).15
Authorities indicate that, on average, the time taken for clearance of export goods through Customs isone day, unless there is need to verify the information provided.
57. Under the Coffee Regulations 1994, all buyers, processors, and exporters of coffee must be
registered with, and certified by, the Uganda Coffee Development Authority (UCDA)(Chapter IV(2)(ii)(a)).  To qualify for a coffee exporter's certificate – valid for one "coffee year" of
October-September and renewable but not transferable – an applicant must have assets that include a
coffee processing factory, provide a performance bond of US$25,000 (not in cash), and pay the
annual registration fee of U Sh 1.5 million.  In addition, individual consignments are subject to quality
certification by the UCDA.
(ii) Export taxes, charges, and levies
58. Uganda has no export taxes, charges or levies except a 1% cess collected by the UCDA on
coffee exports (Chapter IV(2)(ii)(a)).  The Coffee Stabilization Tax was abolished in 1995.
(iii) Export prohibitions, restrictions, and licensing
59. Exporters are allowed to export all items except those on a negative list and those for which
authorization must be obtained from regulatory bodies.  The negative list of exports includes timber,
charcoal, and whole fresh fish.  For items covered by international conventions to which Uganda is a
signatory, such as some wild animals and their tr ophies, prior authorization must be obtained from the
                                                     
15 The CD3 forms are for use by the Bank of Uganda and other government agencies, primarily for
statistical purposes.Uganda WT/TPR/S/93
Page 43
Uganda Wildlife Authority;  this is granted only if  the exporter can satisfy the authorities that the
export item is sustainable without endangering the species.
60. Uganda has no voluntary export restraints.
(iv) Subsidies, duty and tax concessions, and export-performance requirements
61. According to the authorities, Uganda does not subsidize its exports.  Exporters are eligible for
the Manufacturing Under Bond and the Duty Drawback Schemes (section (2)(ii)(e)).  Moreover,exports are zero-rated for VAT refund purposes (refund of VAT collected on inputs used for their
production).
62. Uganda has not yet developed export-processing zones, but is in the process of completing a
draft Bill and policy on special economic zones, and multi-facility economic zones (MFEZ) as
described in a 2000 report on "The Big Push Strategy".  These may also cover export-processingzones.
(v) Export finance, insurance and guarantees
63. The Bank of Uganda (BOU) administers th e Export Refinance Scheme (ERS), which
provides some export finance support for non-traditional and non-perishable products.  This scheme is
channelled through commercial banks, but those banks are reluctant to use the funds, as the incentiveis lower collateral and not lower interest rates.  Between 1991 and June 2000, the ERS funded 195
export contracts totalling U Sh 14.6 billion, with a balance of U Sh 5 billion remaining.
16  The main
export commodities funded include fruit and vegetables, maize, fish, fish maws, simsim, groundnuts,
hides and skins, vanilla, flowers, and minerals.  Financing is available for preshipment credit facilities
against an export order or contract, to meet working capital requirements;  post-shipment credit
facilities against shipping documents;  export bills;  letters of credit to replenish exporter's working
capital needs during the period between the shipment of goods and realization of the proceeds;  andmedium-term loans to exporters for investment in infrastructure, such as cold storage, warehousing,
cleaning, drying, and packaging facilities.  The loan coverage for preshipment and post-shipment may
not exceed 80% of the cost of the project;  the maximum for the medium-term loans may not exceed
75%.  The maximum loan period for preshipment and post-shipment working capital loans is 180
days, while medium-term loans are granted for a maximum of five years, including a grace perioddetermined on the nature of the project, but not exc eeding two years.  The interest rate is negotiable
between the lending institution and the borrower.  To qualify, a borrower must:  be a bona fide and
licensed exporter or trader dealing in non-traditional export commodities; be creditworthy and not in
default on any credit scheme or to any financial authority or the tax authority;  and have firm export
order(s) or letters of credit in his favour for an export consignment and be capable of fulfilling hiscommitments.
64. In 2000, the BOU undertook a review of the ER S with the intention of identifying the
problems of the scheme and improving its operations.  This review led to the creation of a guarantee
programme to help Ugandan exporters of non-traditional goods and services obtain credit for their
working capital requirements from participating fi nancial institutions.  This programme, created in
2001, is known as the Export Credit Guarantee Sche me (ECGS).  ECGS objectives are to stimulate
non-traditional exports by ensuring that sufficient credit facilities be made available to these
                                                     
16 Ministry of Finance, Planning and Economic Development (2000b), p. 62.WT/TPR/S/93 Trade Policy Review
Page 44
exporters.17  This will be accomplished by guaranteeing a portion of the credit risk on commercial
loans extended to such firms.  The BOU will partially guarantee loans extended by Ugandan banks
known as participating financial institutions (PFI).  Only those institutions accredited by BOU will
operate under the ECGS as PFIs;  currently six co mmercial banks are accredited.  Anyone having
been in the export business for one year and having a confirmed order is eligible.  The guarantees
cover 75% of the loan amount plus related interest;  the rates are negotiated between the borrower andits PFI.  Loans guaranteed under the ECGS are based on "commercially reasonable" terms and
conditions.  The expectation is that the PFIs should become more willing than in the past to make
available the credit needed by Ugandan exporters to fund their preshipment expenses.  The initial
capital is U Sh 2 billion contributed by USAID and U Sh 1 billion from the Bank of Uganda.
65. In 2001, a multi-country Africa Trade Insurance Agency was created to implement the
Regional Trade Facilitation Project (RTFP), in cooperation with private insurers.  The RTFP was
initiated by COMESA and supported by the World Bank.  The objective of RTFP is to facilitate
access to and improve the terms of trade finance for imports into and exports from participating
African countries.  The RTFP is to achieve this objective by making available to exporters quick and
automatic political-risk insurance for trade transactions.  The World Bank has provided credits toseven participating countries (Burundi, Kenya, Malawi, Uganda, Tanzania, and Zambia) to back up
the insurance policies, in the amount of US$105 million.
(vi) Export promotion and marketing assistance
66. The main promotion agency for non-traditional exports is the Uganda Export Promotion
Board (UEPB), which came into being in 1996 fo llowing restructuring and rationalizing of the
Uganda Export Promotion Council (1983-1996).  Uganda  created the UEPB as a parastatal under the
Ministry of Tourism, Trade and Industry (MTTI) to be the only government agency modelled alonginternationally accepted national trade promotion organizations.  UEPB's statutory mandate is to
promote and develop Uganda's exports in regional a nd global markets, i.e. to formulate strategic
policies, programmes, and activities that promote and develop competitive exports and markets in
order to earn sufficient foreign currency to satisfy national import requirements of goods and services.
67. The five main pillars of UEPB's interventions are:  policy initiation and advocacy, trade
information generation and delivery system, exporters' skill development, market research and
development, and product research adaptation a nd development.  The UEPB maintains a trade
information centre, which provides pricing and marketing information, offers market research
assistance, organizes participation in trade fairs, provides training (usually in collaboration with
international donors), and has a small commercial li brary.  Companies do not pay for UEPB services.
68. MTTI does not believe the UEPB has performed adequately, largely because of a traditional
national lack of political commitment to the status of national trade promotion organizations.  This
attitude undermined the UEPB shortly after its creation in 1996, and a report to Government (The
Hogg Report) was produced in 1999 and recommended the disbandment of UEPB.  Government did
not accept the recommendations of the Report.  Closely connected to the lack of political commitmenthas been the perpetual underfunding of the UEPB.  The UEPB believes it requires on average
US$2 million per year to accomplish its statutory mandate.  Funding has been about 25% of budget
since the Board's creation, and most of this budget allocation has gone toward meeting overhead costs,
                                                     
17 Non-traditional exports are all commodities excluding coffee, cotton, tea, and tobacco in their raw
form.  Eligible applicants must have been non-traditional exporters for at least one year and have confirmed
orders.Uganda WT/TPR/S/93
Page 45
leaving meagre funds to execute UEPB's e xport promotion and development programmes.18
Additionally, a statutory provision to levy up to 0.5% of designated imports has not been
implemented.19  All exporters, including potential exporters, are eligible for assistance.  In mid-2001,
the Government decided to merge the UEPB, UIA, and the Uganda Tourist Board into a single entity;
the merging process is under way.
69. An Export Promotion Fund (EPF), within the Bank of Uganda, was launched at the end of
1995 under the European Investment Bank-Uganda Ap ex Export Loan Scheme for export enterprises,
with the aim of helping exporters to carry out export promotional activities.  The fund, which is
intended to be a revolving fund, provides interest-free loans (for up to one year) of up to
U Sh 5 million for export marketing studies, manage ment and staff training, hire of sales agents or
representatives abroad, and production of publicity/promotional materials for exporting companies.As of February 2001, the EPF had funded six enterprises.
70. Export enterprises retain 100% of their foreign exchange earnings.  They are free to open
foreign exchange accounts and deposit their earnings.  They are also free to use these earnings toexpand their operations.
(4) M
EASURES AFFECTING PRODUCTION AND TRADE
(i) Incentives
71. Incentives on behalf of local manufacturers are:  VAT deferment, tariff and tax concessions,
and the Manufacturing Under Bond Scheme.  The Investment Code of 1991 encouraged investors to
use locally sourced materials, invest in rural regi ons, and to earn or save foreign exchange.  That
encouragement, however, was hortatory rather than mandatory.  A review is under way to update the
Investment Code.
72. Section 14 of the Finance Statute 1997 created a new incentive regime of investment capital
allowances to replace the tax holiday facility.  The new incentive scheme is specified in the 1997Income Tax Act (Sections 28 to 34, 36, 37, and 168), which repealed previous manufacturing
incentives, primarily tax holidays.  These incentives can be summarized in three categories – capital
allowances and expenses, deductible annual allowances, and other annual depreciation allowances
(Table III.2).  For regional development purposes, some incentives for investments outside the
Kampala area are greater than those for investments in Kampala.
73. It should be noted that, under section 39 of the 1997 Income Tax Act, on Carry Forward
Losses, an assessed loss arising out of company operations, including the loss from the investment
allowance, shall be carried forward and allowed as a deduction in determining the taxpayer'schargeable income in the following year.  In addition, investors may benefit from tax provisions in the
budgets of individual financial years.
20
74. Licensed investors can enjoy a deferred VAT payment facility on plant and machinery, raw
material for drugs, seedlings, greenhouse equipment, plastic sleeves, and tea clones.  The facility is
granted on a consignment-by-consignment basis, as approved by the Commissioner for VAT.  Inaddition, the Budget for the financial year 2000/01 provided VAT exemption to producers of all types
                                                     
18 Uganda Export Promotion Board (1999), page xi.
19 Ministry of Tourism, Trade and Industry, pp. 19-22.
20 UNCTAD-ICC (2001), p. 48.WT/TPR/S/93 Trade Policy Review
Page 46
of agricultural inputs, removed the customs tariffs on some imported raw materials, and waived the
import licence commission and the withholding tax on all imported raw materials.21
Table III.2
Investment capital allowances, 2001
Percentage
Category 1:  Capital allowances/expenses deductible once from a company's income
Initial allowances on plant and machinery
Located in Kampala, Entebbe, Namanve, Jinja, and Njeru 50
Outside Kampala, Entebbe, Namanve, Jinja, and Njeru 75
Start-up costs spread over the first four years (per year) 25
Scientific research expenditure 100
Training expenditure 100
Mineral exploration and exploitation expenditure 100
Initial allowance on new industrial buildings (including tourism facilities:  hotels and lodges) 20
Category 2:  Deductible annual allowances
Depreciable assets specified in four classes (sixth schedule) under declining balance method:
Class 1 - Computers and data handling equipment 40
Class 2 - Automobiles, construction and earth moving equipment 35
Class 3 - Buses, goods vehicles, tractors, trailers, plant and machinery for farming, manufacturing and mining 30
Class 4 - Railroad cars, locomotives, vessels, office furniture, fixtures, etc. 20
Category 3:  Other annual depreciation allowances
Industrial buildings, hotels and hospitals (using the straight-line method) 5
New commercial buildings constructed after 1 July 2000 (using the straight-line method) 5
Farming – general farm works (Class 4 assets under sixth schedule part 1) (declining balance depreciation) 20
Horticulture (horticultural plant and construction of green houses) (straight-line depreciation) 20
Source : UNCTAD-ICC (2001), An Investment Guide to Uganda:  Opportunities and Conditions , page 48.
75. A newly licensed investor (referred to as an "investment trader"), opening up investment
opportunities in Uganda for the first time, can claim a refund of VAT paid on all purchases (both local
and imported) for purposes of the licensed project.  This applies to all sectors, except trade, and over aperiod of two years from establishment.
76. The National Council of Science and Technolo gy (NCST) is responsible for coordinating
national research and development programmes.  Ho wever, the NCST is poorly funded.  There are a
few R&D programmes run by the National Agricu lture Research Organization (NARO) and even
fewer by the newly created Uganda Industrial Research Institute (UIRI), which is part of the growingcollaboration within the East African Community.
77. The European Investment Bank-Uganda Apex Loan Scheme (section (3)(vi) is meant to
address economic modernization more broadly, be yond just the export sector.  Phase I of the
programme (€15 million) was successfully implemented and phase II (€25 million) is under
implementation.  The investments financed under the programme relate to new projects and/orexpansion, modernization, restructuring, and diversification of existing activities.  Eligible activities
include agri-industry, manufacturing, horticulture and flower growing, fishing/fish processing, mining
and quarrying, hotels and tourism, and other services such as garbage collection and disposal, and
cleaning equipment for industries.  At the end of March 2000, 57 projects had been financed at a total
cost of €25 million.
                                                     
21 Uganda Investment Authority (2000), pp. 33-35.Uganda WT/TPR/S/93
Page 47
78. Investment incentives are not available for several types of businesses, namely wholesale and
retail commerce, the personal services sector, public relations business, car hire service and operation
of taxis, bakeries, confectioneries for the Uganda market only, postal services, and professional
services.22
(ii) Standards and other technical requirements
(a) Standards
79. The Uganda National Bureau of Standards ( UNBS) is a statutory organization under the
MTTI.  The UNBS is dedicated to promoting industrialization, local and international trade,
competitiveness of goods and services, and overall national development;  ensuring consumer
satisfaction and protection, a clean environment, and fairness in trade;  and facilitating flow of
standards information and technology transfer through timely and up-to-date standardization, testing,inspection, quality assurance, metrology, dissemination of standards information, and cooperation
with partners locally and internationally.
80. Uganda believes that the formulation of national standards or adoption of foreign and
international standards as Ugandan standards is very important for its economic development.  As of
September 2001, UNBS had developed, promulgate d and gazetted 253 Ugandan standards in the
fields of food and agriculture, building materials, electrical items, and chemicals.  It has also
participated in the development of 207 East African harmonized standards (in various areas) to
facilitate trade within the region.  Several trade documents used for customs and transfer of goods
among the East African States have already been harmonized by Uganda, with UNBS as the
coordinating agency.
23
81. Since standardization is expensive in terms of time and finances, it is important that the
standards formulated are usable.  In this respect, before embarking on a standards formulationprocess, a needs assessment is carried out to asse ss priority areas for standardization.  UNBS' main
role during a standardization process is that of a secretariat, i.e. it prepares a discussion document,
convenes appropriate technical committee (TC) meetings, takes minutes of the TC meetings, prepares
draft standards for public comment, and then publishes the standards.  A Technical Committee
comprised of all appropriate interest groups, e.g. academia, researchers, manufacturers, exporters, andconsumers, is established for each sector.  Curren tly, UNBS has seven operational TCs:  TC on Basic
Standards;  TC on Food and Agricultural Products;  TC on Building and Construction;  TC on
Mechanical Engineering and Metallurgy;  TC on Chemicals and Environment;  TC on Electrical
Technology;  and TC on Textiles.
82. Draft standards are circulated for wider public comment;  this includes other countries, such
as trading partners, so as to avoid creating technical barriers to trade.  A 60-day period is provided for
such comments.  The TC convenes after the comments  have been received to ensure that the relevant
concerns are considered.  Draft standards are subm itted to the National Stan dards Council (NSC), the
governing body of UNBS, for approval.
24  The TC may make recommendations to the NSC for
compulsory application of the standard if it is likely to affect the health and safety of consumers.After approval of standards, the NSC may also recommend the Minister responsible for Trade to
                                                     
22 Uganda Investment Authority (2000), p. 53.
23 Ministry of Tourism, Trade and Industry (2000a), pp. 48-50.
24 The NSC consists of representatives from various national institutions and departments and the
private sector.WT/TPR/S/93 Trade Policy Review
Page 48
declare compulsory application of standards that affect, inter alia,  health and safety;  according to the
authorities, international standards are generally followed.
83. Approved standards are published in newspapers as well as in the Government Gazette .  For
compulsory standards, the intention to declare them compulsory is first published by the Minister
responsible for Trade in the newspapers as well as in the Government Gazette,  and a period of 60 days
is given for comments from the parties they may affect.  After 60 days, if no comments are received,the standards are declared compulsory by a statutory instrument.
84. Product testing is undertaken on consumer complaints, for market surveillance, for standards
formulation, and for compliance to specifications.  UNBS has set up laboratories in the fields of
electrical testing, chemical testing, microbiology, and building materials.  The microbiology
laboratory has been accredited by the South African National Accreditation System (SANAS).  Thechemical laboratory is seeking international recognition.
85. UNBS has developed, and issues under licence, a standards quality mark known as the
Uganda Standards Certification Mark.  The mark indicates that the manufacturer is capable of
consistently manufacturing a safe and quality product in accordance with Ugandan or internationally
accepted standards.  To date, 28 companies have benefited from this scheme, and another 12 are in thepipeline.  UNBS publishes annually a Catalogue of Uganda Standards.  The 2000/01 edition contains
23 pages of summaries of current standards, both compulsory and voluntary.
86. UNBS runs five  regional weights and measures offices, in Kampala, Jinja, Mbale, Mbarara
and Gulu.  It has set up a National Metrology Laboratory with capacity to cater for measurement and
verification of all measurable quantities.
87. UNBS is the Enquiry Point, notified to the WTO, and the necessary infrastructure is being put
in place to handle this task.  Currently, a consultant is being engaged by UNBS to ensure that theenquiry point becomes operational using available equipment.  There are plans to ensure that all
enquiries are answered on line.  UNBS runs an Information and Documentation Centre with
information on Uganda standards, British standards, and information on international standards, such
as ISO.  The Centre is also in a position to provide information on standards of other countries on
request through its networking, as UNBS is linked to a number of standards organizations.
88. There is much domestic criticism of the Government's commitment to standards.  A recent
study noted that the UNBS did not have the capacity to fulfil its obligations.  It lacks technical
competence in terms of equipment, and suffers financial constraints.  There is need to repeal obsolete
laws and put in place modern laws that are in conf ormity with international standards.  The control
systems to ensure health and safety are inadequate, and inspection of existing facilities, such as thelaboratory testing facilities, is rare.  Sanitary conditions, particularly in food processing (e.g., the fish
landing sites) are inadequate.  The UNBS lacks adequate funding, and consideration is being given for
UNBS to build a strong partnership with the private sector in providing laboratory testing facilities
and carrying out inspection on a contract basis.
25
(b) Health, sanitary, phytosanitary, and environmental regulations
89. The Government has drafted new SPS legislation (expected to be called the Plant Protection
Act of 2001), as it believes current legislation to be out of date.  The draft legislation must be
introduced to Parliament before the end of 2001.  The current legislation derives from the Plant
                                                     
25 Ministry of Finance, Planning and Economic Development (2000c), pp. 45-46.Uganda WT/TPR/S/93
Page 49
Protection Act of 1937, which, after independence, became Chapters 2 and 4 of the Laws of Uganda,
1962.  Currently, all imports of live animals, plants and seeds are subject to quarantine regulations and
may enter only at one of the 22 designated ports of entry where customs officials are present.26  I n
practice, however, some positions are vacant.
90. The Ministry of Agriculture has responsibility for three regulatory areas:  phytosanitary
controls, matters relating to seeds, and agricultural chemicals and pesticides.  The same corps ofinspectors is empowered to enforce regulations fo r all three areas.  To prevent the introduction of
infectious diseases, the Minister of Agriculture may restrict the entry of any person, animal, plant or
plant part under the Public Health Act, and impose requirements or conditions (medical examination,
detention, quarantine, disinfection, or isolation).  The Minister of Agriculture is empowered to make
regulations or orders regarding the manufacture, importation, storage, and sale of foods, includingimport prohibitions on products that are not clean, wholesome, and free of diseases.  No plant or part
of a plant may be imported without a permit from the Ministry of Agriculture, and fresh fruit require
an additional certificate signed by an appropriate government official in the exporting country.  Soil is
prohibited from entry into the country.
91. The Food and Drugs Act 1959 authorizes UNBS to prohibit, inter alia , the sale and
possession of any food unfit for human consumption, and any false or misleading labelling and
advertisement of food and drugs.  To this effect , an authorized officer may "at all reasonable times"
examine food sold or stored, as well as any vehicle or container used.  Where necessary, the officer
may prohibit or restrict transport of imported food for up to 48 hours.  Increased surveillance has
resulted from shipments of expired rice, wheat, and juice intended for the Ugandan market.
92. The WTO Secretariat is not aware of any prohibition by Uganda on live animals, such as
beef, and products thereof.
93. The Government of Uganda formulated and enacted a National Environment Statute in May
1995.  The Statute is a framework law to be complemented with subsidiary laws.  In this context, the
Government has, since 1996, formulated and gazetted a number of guidelines, codes of conduct, and
regulations, some of which have trade implications .  The main guidelines and regulations enacted in
the recent past include:  the Environmental Im pact Assessment Guidelines for Uganda, 1997;  the
Environmental Impact Assessment (EIA) Regulations, 1998;  the Environmental Audit Guidelines for
Uganda, 1999;  the National Environment (standards for Discharge of Effluent into Water or on Land)
Regulations, 1999;  the Waste Management Regulations, 1999;  the Regulations on Access and
Benefit Sharing of Genetic Resources (Draft);  the Regulations on the Management of Toxic
Chemicals and Hazardous Materials (Draft);  and the Biosafety Policy Framework.
94. The EIA Guidelines and Regulations and th e Environment Audit Guidelines provide a
framework for assessing the likely impact of proposed developments, including establishment of
processing facilities, but also the likely environm ental impact of new imports or export processes.
The National Environment (Standards for Discharge of Effluent into Water and on Land) Regulation,
the Waste Management Regulations, and the Regulations on Management of Toxic Chemicals andHazardous Materials prevent the importation of wastes, and the disposal of imported wastes and
imported goods damaged in transit in Uganda.  Under the National Environment Statute, the National
Environment Management Authority (NEMA) and lead agencies recently developed regulations to
control access to genetic and biological resources in Uganda.  The regulations on Access and Benefit
                                                     
26 The plant quarantine service unit under the Ministry of Agriculture regulates the exit and entry of
live plants and seeds.WT/TPR/S/93 Trade Policy Review
Page 50
Sharing of Genetic Resources and the Biosafety Policy Framework provide a framework for the
management of imports and exports of biodiversity resources and biotechnology.27
95. The NEMA is the statutory authority mandated through the (1995) National Environment
Statute to formulate environment standards in a number of priority areas of concern.  Five such
standards have been considered for development, including discharge of effluent into water or land,
air quality, soil, and noise and vibration pollution.  The development of environment standards isaimed at protecting environment quality and public health;  building and strengthening the credibility
of environmental requirements nationally, regionally and internationally;  ensuring fairness to all the
regulated communities so as to minimize social conflicts;  and reducing costs and liability by making
polluters shoulder the short-term costs to attain long-term benefits economically and ecologically.
Environmental standards are for sustainable development purposes.
(c) Labelling and marking requirements
96. The following information must be clearly marked on imports and exports:  importer/exporter
names;  consignee;  flight/vehicle details;  place of discharge;  number of packages;  container
identity;  description of goods;  airway bill number/bill of lading;  and country of origin/destination.
All marks must correspond exactly with t hose on the invoice and bill of lading.
97. Specific labelling requirements apply to imports of food products.  For example, for
condensed milk for human consumption, each receptacle or container, with a net weight of under
7 kg. must bear a printed label stating its contents in equivalents of pints of milk, whether skimmed or
whole, sweetened or unsweetened, and whether unsuitable as a sole food for babies.
28
(iii) Intellectual property rights
98. Uganda has laws governing intellectual property, except on neighbouring rights, industrial
designs, technovation, geographical indications, and trade secrets.  However, even where there is aUgandan law, it is out of date with modern technological and socio economic developments and,
according to the authorities, not conducive to the desired goals of national policies, especially the
attraction of investment and compliance with Uganda's international legal obligations, in particular the
WTO Agreements on TRIPS.  Furthermore, as the COMESA and East African Community processes
move forward, intellectual property matters will become increasingly important to the Ugandaneconomy.
99. To address the special concern of each form of intellectual property effectively, the
Government expects to revise the laws in this area and has established a task force under the Uganda
Law Reform Commission to do so.  The task force has five committees, each charged with particular
groups of stakeholders.  Members of the task force include representatives from the Government,interested business enterprises, and civil society.  The five committees handle issues of interest to:
publishers, writers, and economic researchers;  broadcasters, performers, and composers;
manufacturers, investors, and designers/artists;  agriculture/research, pharmacists, and herbalists;  and
administration of justice and law enforcement agencies.
29
                                                     
27 The regulations include matters relating to the sharing of benefits with local communities, biological
resource owners, research institutions, and the Government for plants and plant products or by-products fromUganda.
28 Dun and Bradstreet (2000).
29 Uganda Law Reform Commission (2001).Uganda WT/TPR/S/93
Page 51
100. Uganda has signed the Paris Convention on the protection of industrial property (e.g. patents,
industrial design, trade marks, service marks, trade names, and appellations or origin);  it has not
signed the Berne Convention or the Rome Convention.
101. The current legislation on intellectual property does not cover parallel imports.
(a) Copyrights
102. The protection of copyrights in Uganda is governed by the Copyright Act of 1964, which is
currently under comprehensive review.  The Act covers literary, musical, or artistic works,
cinematograph films, gramophone records, and broadcasts, but not computer programs or data
compilations.  Protection for published literary, musical or artistic works is granted for 50 years from
the year of the first publication, published films and gramophone records are protected for 45 years
from the year of publication, and broadcasts for 50 years from the year of production;  the provisionsfor unpublished works are slightly different.  In order for a work to qualify for protection, its author
must be a citizen or resident of Uganda or of a country listed in the Second Schedule of the Act;  the
list is currently under review.
30
103. The copyright holder is generally entitled to control the distribution of copies, any public
performances for payment, and broadcasts.  In the event of infringements, he may seek compensationfor damages, an injunction to restrain further violations (including border measures), and an
injunction requiring the destruction of copies.  When the competent Minister considers that a licensing
body "unreasonably" refuses to grant a licence or imposes "unreasonable terms or conditions", he may
lift existing restrictions, subject to payment of an appropriate fee.  According to the authorities, there
have been no such cases to date.
104. Bootlegging of cassettes and videos is common.  Such counterfeited items can be found for
sale on the streets.
31
(b) Patents
105. Under the Patent Statue of 1991, protection is granted for any inventions, whether products or
processes, that are "new, involve an inventive step and are industrially applicable".32  A public interest
provision allows for a statutory decision, valid for up to two years, which excludes certain kinds of
product or process inventions from patentability.  The exclusion is to be applied on a case-by-casebasis, but has not been used to date.  The patent period is 15 years from the date of granting and may
be extended for five years.  An annual maintenance fee must be paid.
33  The patent owner has the
                                                     
30 The countries are:  Andorra, Argentina, Austria, Belgium, Brazil, Burundi, Cambodia, Canada,
Chile, Costa Rica, Cuba, Czech Republic, Denmark, Ecuador, Finland, France, Germany, Ghana, Guinea, Haiti,Iceland, India, Ireland, Israel, Italy,  Japan, Laos, Lebanon, Liberia, Liechtenstein, Luxembourg, Mali, Mexico,
Monaco, Nicaragua, Nigeria, Norway, Pakistan, Panama, Paraguay, Philippines, Portugal, Rwanda,Slovak Republic, Spain, Sweden, Switzerland, the United Kingdom, the United States, and the Vatican.
31 United States Department of Commerce (2000), Chapter IV, p. 2.
32 The following are not eligible:  discoveries and scientific mathematical theories;  plant or animal
varieties or essentially biological processes for the production of plants or animals;  schemes, rules or methodsfor doing business;  surgery or therapy methods for humans or animals;  and mere presentation of information.Under the previous regime, patents were obtainable only as confirmation of U.K. patents and thus had to beregistered in the United Kingdom (Dun & Bradstreet, 1994).
33 U Sh 48,000 for the first year, and U Sh 12,000 thereaf ter.  The fees are in addition to the original
application fee of U Sh 180,000 and the application fee of U Sh 60,000 for the five-year extension.WT/TPR/S/93 Trade Policy Review
Page 52
exclusive right to exploit the invention and, in the event of infringement, may initiate proceedings in
the High Court for damages, an injunction (including border measures), and other remedies.
106. The Statute provides for two types of compulsory licence. First, on the grounds of "vital
public interest", government agencies or designated persons may at any time obtain authorization to
exploit a patented invention, provided that the patent owner or licensee has been given an opportunity
to comment and that adequate remuneration is paid.  Second, Ugandan courts may grant a compulsorylicence after specified periods if the patented invention has not been worked in Uganda;  the existing
degree of working does not meet domestic demand;  working is hindered or prevented by the
importation of the patented product;  or the owner has refused to grant licences on reasonable terms,
thus unfairly and substantially prejudicing domestic industrial or commercial activities or export
possibilities.
34  To date, no compulsory licences have been granted.
107. Patent owners are bound under the Patent Statute not to impose on any licensee "unjustified
restrictions" that are "harmful to the economic interests of Uganda".  The Statute lists 18 prohibited
restrictions, including certain exclusive dealings, limitations on production and exportation of
patented products, and sale or resale price maintenance requirements.
(c) Trade marks
108. Under the Trade Marks Act of 1964, any mark (including names, signatures or words) may be
registered with the Registrar of Trade Marks.35  The initial registration is valid for seven years and
may be renewed for 14-year periods.  Registration may be cancelled if the mark was registered
without any intention to use it and has actually not been used, or if it has not been used for a
continuous period of at least five years.  The Trade Mark Act does not specify remedies against
infringements, nor are there provisions for compulsory licensing.  The Act is currently being reviewed
to include service marks.
(iv) Role of state-owned enterprises and privatization
109. The Government of Uganda remains committed to privatizing all state-owned enterprises.
The Secretariat responsible for overseeing the streamlining of the parastatal sector and reducing direct
government involvement, and for the Public Enterprise Reform and Divestiture Programme (PERD)
was restructured on 4 January, 1995.36  Two units were created:  the Privatization Unit to handle all
matters related to divestiture and the Parastatal Monitoring Unit to monitor financial flows to
parastatals.  In 2000, a third unit (the Utility Reform Unit) was created to handle reform and
divestiture of utilities.
110. As of 31 July 2001, 74 of the 148 public enterprises slated for divestiture had been sold, and
34 had been either struck off the register of companies or liquidated.  Thus, 40 companies remain aspublic enterprises to be privatized or liquidated (Table III.3).  Recent privatizations were carried out
in telecommunications services, hotel and tourism, and an initial public offering of British American
Tobacco Limited.  Further privatizations continue in, inter alia , financial services (although some
                                                     
34 Compulsory licensing is not possible within four years of the filing of a patent application or three
years of granting the patent.
35 Application fees vary between US$150 and US$250 for foreign applicants and U Sh 2,000 and
U Sh 4,000 for Ugandan applicants, depending on the scope of protection.  An additional US$250 andU Sh 4,000, respectively, must be paid on registration.
36 For transparency purposes, a Divestiture Procedures Manual was developed in 1998, and the PERD
statutes were amended in 1997 and 2000 to remove some legal inconsistencies.Uganda WT/TPR/S/93
Page 53
difficulties have been experienced with the process in banking services), tourism, and electricity;  by
2004, the Government anticipates further privatizations  to be completed in transportation services and
in utilities.
111. As a result of privatization, the only public enterprises that enjoy monopoly rights are Uganda
Railways and the Post Office (for certain categories of letters).  While the State controls major
portions of electricity generation and distribution, it does not have a monopoly.
112. The proceeds of the divestiture process have been used primarily for termination benefits for
workers of the privatized firms, payment of debts incurred by certain public enterprises, direct costs of
preparing the enterprises for privatization up to the time of divestiture, and caretaker loans to ensure
that enterprises did not deteriorate, but remained in a saleable state.37
Table III.3
Divestiture programme of remaining public enterprises, July 2001
EnterpriseGovernment
ownership
(%)What will
be sold
(%)Type of business
1. Cable Corporation Ltd. 51 51 Cable manufacturer
2. Coffee Marketing Board 100 100 Coffee marketing
3. Dairy Corporation 100 70 Milk & milk products production
4. Development Finance Company of Uganda Ltd. 20 20 Development finance
5. Housing Finance Company of Uganda Ltd. 50 49 Mortgage lending
6. Industrial Promotion Services Ltd. 30 30 Investment promotion
7. Johnas Bros. (Africa) Ltd. 100 100 Taxidermy
8. Kasese Cobalt Ltd. 25 25 Cobalt plant
9. Kilembe Mines Ltd. 100 100 Copper mine
10. Kinyara Sugar Works Ltd. 100 100 Sugar processing
11. Mandela Stadium 100 Concession Sports stadium
12. National Enterprise Corporation 100 49 Various
13. National Housing and Construction Corporation 100 49 Housing construction
14. National Insurance Corporation 100 100 General and life insurance
15. National Medical Stores 100 49 National drug distributor
16. National Water & Sewerage Corporation 100 Concession Water and sewerage
17. New Vision Printing and Publishing 100 49 Printing and publication
18. Nile Hotel International Ltd. 100 49 Hotel and conference
19. Post Bank (U) Ltd. 100 49 Post bank services
20. Rwenzori Highland Tea 7 7 Tea production and sale
21. Sugar Corporation of Uganda Ltd. 30 30 Sugar manufacturer
22. Uganda Air cargo Corporation 100 100 Aviation - cargo transport
23. Uganda Commercial Bank 100 100 Commercial banking
24. Uganda Crane Estates Ltd. 100 100 Farmland
25. Uganda Crane Industries Ltd. 100 100 Investment promotion
26. Uganda Development Bank 100 100 Development finance
27. Uganda Development Corporation 100 100 Investment promotion
28. Uganda Electricity Distribution Co. Ltd. 100 Concession Electricity distribution
Table III.3 (cont'd)
                                                     
37 Ddumba-Ssentamu and Mugume (2001), pp. 47-51.WT/TPR/S/93 Trade Policy Review
Page 54
EnterpriseGovernment
ownership
(%)What will
be sold
(%)Type of business
29. Uganda Electricity Generation Co. Ltd. 100 Concession Electricity generation
30. Uganda Grain Milling Company Ltd. 28 28 Grain milling
31. Uganda Hotels Ltd. 100 100 Hotel and tourism
32. Uganda Libyan Arab Holdings Ltd. 50 50 Cattle ranching
33. Uganda Livestock Industries Ltd. 100 100 Commercial banking
34. Uganda Posts Ltd. 100 49 Postal service
35. Uganda Printing and Publishing Corporation 100 100 Printing and publication
36. Uganda Prisons Industries Ltd. 100 100 Various
37. Uganda Railways Corporation 100 Concession Railway transport
38. Uganda Seed Ltd. 100 49 Seed multiplication
39. Uganda Telecoms Ltd. 49 49 Telecommunications
40. Uganda Engineering Company Ltd. 51 51 Metal fabrication
Source: Information provided by the Ugandan authorities.
113. Several reviews of privatization procedures have been conducted.  At the conclusion of the
first phase of the progamme, on 31 December 1999, Parliament reviewed the privatization process.
The review identified several areas that needed  to be improved by the Government for future
privatizations.  These included the various uses of divestiture proceeds, increased transparency, and
procedures to assure greater ownership by Ugandan nationals of the newly privatized companies.38
114. The nature of the sales has varied tremendously, including public auctions, closed bidding,
sale of assets to former private owners, sale of assets to minority shareholders, and sale of shares on
the stock exchange.  In October 1999, Uganda Clays, Ltd., was the first company to be divested
through the sale of shares to the public and listing on the Uganda Securities Exchange. Current
priorities are the reform of the water, rail, and power subsectors.  An Infrastructure Country
Framework Report initiative is expected to contribute to the development of a more effective and
timely utility reform and privatization.  However, a considerable amount of work remains in terms of
establishing regulatory agencies and implementing privatization transactions.39  In April 2001, the
Government proposed the adoption of multi-sector regulatory bodies to conserve resources and be
able to manage them with the few local staff available in the country that have the requisite
experience.40
115. Foreigners can own 100% of privatized companies.
(v) Competition policy and regulatory issues
116. Uganda does not yet have legislation in relation to competition policy.  The drawing up of
competition policy is likely to take some time.  Competition law or fair trade practices, including
antitrust measures, is being formulated by the Uganda Law Reform Commission, purposely
established to review all laws, including Commercial laws.  This exercise is in its early stage.  The
eventual competition law will be similar to that of Kenya and Tanzania under the framework of EastAfrican Community.  Four statutes currently contain general provisions on competitive practices:  the
                                                     
38 Uganda Manufacturers Association (2000).
39 Ministry of Finance, Planning and Economic Development (2000d), p. 23.
40 Ministry of Finance, Planning and Economic Development (2001a), p. 58.Uganda WT/TPR/S/93
Page 55
Sale of Goods Act, the Customs Management Act, the Limitations Act, and the Penal Code.  There
have not been any recent legal cases on competition issues, and there are no official bodies dealing
with competition issues.  The anticipated competition law will embody services and goods.
117. Uganda has no large companies functioning as cartels. However, there are complaints that
certain oil companies are behaving like cartels, and there have been calls for competition legislation to
curtail that behaviour.  As part of Uganda's efforts to create the conditions for a market economy, themonopoly role of the Coffee Marketing Board has ended, and there no longer is state trading in
cotton, although the Cotton Development Organization, a government regulatory body, gives
indicative farm gate prices for cotton at harvesting season.
118. Except for fixed telephone services, the WTO Secretariat is not aware of other goods or
services subject to price controls.