Local Content Bill passed, procurement of EAC goods approved
Kampala, Uganda | THE INDEPENDENT | Parliament has considered President Yoweri Kaguta Museveni’s recommendation on prioritisation of procurement of goods, works and services from the East African region under the passed National Local Content Bill, 2022.
President Museveni returned the Bill, that was initially passed by parliament on 6th September, 2022 disagreeing with Clause 4 which provided that a local entity shall give preference to goods which are manufactured and services which are provided by Ugandan entities.
In his letter to the Speaker of Parliament, the President argued that giving preferential treatment to Ugandan goods, works and services is contrary to the East African Community (EAC) Protocol of free movement of goods and services and the East African Monetary Union.
While justifying the President’s position during the Wednesday plenary sitting, Deputy Attorney General, Jackson Kafuuzi said that the EAC Protocol takes precedence over the national laws.
Kafuuzi said that other countries may have imposed non-tariff barriers, violating the EAC Protocol but Uganda does not have to do that in law. He said that it will be illegal and can be challenged in the EAC Court.
Enos Asiimwe, the Kabula County MP agreed with the Attorney General saying that Uganda is bound by EAC protocols and treaties.
“We have been at the forefront of advocating for the EAC integration. Uganda cannot be the one to put restrictive laws on movement of goods, services and works,” said Asiimwe.
Mathias Mpuuga, the Leader of the Opposition also said that if preferential treatment is given to Ugandan goods, it would be contested in the EAC Court.
I would like to congratulate @Parliament_Ug for passing the local content bill. It’s been long in coming and agonizing. I also want to thank @KagutaMuseveni for veto-ing it to think East African & not municipally. I appeal to @GovUganda Ugandan &foreign companies to implement
— Elly Karuhanga, (@EllyKaruhanga) March 29, 2023
David Bahati, the Minister of State for Trade noted that Uganda spends time to negotiate agreements and protocols, and they should be respected. “We shall soon be moving from Buy Uganda, Build Uganda to Buy Africa, Build Africa. We have secured a market for all the 54 African countries,” said Bahati.
However, MP Patrick Oshabe, the mover of the Bill described the amendment as ‘legislating for East Africa, and not Uganda’.
Nsamba’s effort to explain that other EAC countries have laws that promote local content was not considered. His desire to recommit the Clause after debate, saying that the House made a mistake was also not considered.
Meanwhile, parliament agreed to 30 per cent of the works to be sub-contracted to Ugandans differing from the President’s proposition mandating the Minister to determine the percentage.
Henry Musasizi, the Minister of State for Finance- General duties) said that since the law is intended to promote local content, it is right for the percentage to be determined by Parliament and not the Minister.
“I see no harm in us determining the minimum percentage. I would suggest anything between 30 and 40 per cent,” he said.
Parliament gave the mandate to develop guidelines for implementation of local content to the minister, as opposed to leaving it with the Public Procurement and Disposal of Public Assets Authority.
The approved Bill seeks to impose local content obligations on a person using public money or utilising Uganda’s natural resources or carrying out an activity requiring a licence to prioritise Ugandan citizens and resident companies owned by citizens in public procurement.