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THE MAWALLA BULLETIN
VOLUME 1
JUNE 2012

THE MAWALLA BULLETIN / IN THIS ISSUE
JUNE 2012 VOLUME 1
A NOTE FROM THE EDITOR
The Mawalla Group launches in Tanzania
This year has flown past at a frightening pace – it’s hard to believe that we are
already halfway through.The year 2010 also marks the 10th anniversary of my
founding of Mawalla Advocates and what a journey we have undergone since
the turning of centuries in 2000! [Read more]
Case Law review
Admissability of Electronic Evidence in Court
As digital technologies advance information sharing around the globe,
Tanzania still has room for improvement when it comes to admissibility of
electronic evidence in court. [Read more]
General Opinions
Current Law Reforms and the Issue of Bail in Tanzania
A conflicting demand arises with regard to the issue of bail when an accused
person is taken into custody. [Read more]
Corporate law review
Introducing the Mawalla Business Care Methology
Doing business has not always been an easy task in developing countries like
Tanzania. In addition to the economic and infrastructural constraints, there
are a multitude of laws and regulations that have to be strictly adhered to,
before, during and after registration of a business.
[Read more]
Real estate law review
How Unit Titles and Mortgage finance are tackling the Plight of Potential Homeowners
in Tanzania
The uneven distribution of wealth in our country has resulted in a dramatic
population increase in urban areas, which has prompted the legislators to
enact accommodating laws which will enable people to own property in the
most convenient manner possible. [Read more]
The Need for Company Secretaries in Tanzania
“Corporate governance is a need of the day in Tanzania and qualified company
secretaries are the means to provide.” The profession of company secretary
is one that has gained significant importance in the corporate world over the
years. [Read more]

THE MAWALLA BULLETIN / A NOTE FROM THE EDITOR JUNE 2012 VOLUME 1
The Mawalla Group launches in Tanzania
This year has flown past at a frightening pace – it’s hard to believe that we are
just about at the end of 2011. The year 2011 also marks the 11th anniversary
of my founding of Mawalla Advocates and what a journey we have undergone
since the turning of centuries in 2000!
We learnt hard lessons from our failures and mistakes, but more importantly,
we built on our successes. In this period we established Mawalla Advocates’
growing reputation for rigorous yet innovative legal practice, while building
a robust infrastructure of office and residential complexes. We have become
Tanzania’s primary exponents of Wildlife Law and Land Law, which will
continue to be our primary legal focus.
Growing, thriving firms such as ours, however, reach turning points. Do we
expand and build further upon the business culture that brought us to this
level of success Or do we consolidate and focus only on our areas of legal
speciality
In discussion with my colleagues, we concluded that it is our patriotic duty to
Tanzania to build upon our robust foundation of solid legal practice - rather
than to hold back and consolidate.
Our Tanzania is clearly a country with the potential to accelerate its economic
growth rate to over 10% per annum, much as China, India, Mauritius and
other thriving economies have done. Tanzania’s economy stands on the
same threshold that the “Asian Tigers” did 15 years ago. How could Mawalla
Advocates stand back when we can offer so much more value to a nation that
urgently needs to uplift millions of fellow Tanzanians out of poverty
We therefore decided on the high road of evolving an expanded Mawalla
group of companies upon the established base of Mawalla Advocates and the
Mawalla Trust Limited. I discuss this in more detail further on in this bulletin.
While making this decision, we realised too that Mawalla Advocates is a
treasure trove of legal, commercial and entrepreneurial knowledge that
has been painstakingly assembled since my father, Juma Sawaya Mawalla,
founded Tanzania’s first indigenous legal practice in 1961.
It is our responsibility to share this accumulated knowledge with Tanzanians
and anyone wanting insights into our law, therefore the Mawalla Legal Bulletin
will also feature extracts from Mawalla Advocates’ extensive knowledge base.
The Legal Bulletin is supported by a redesigned and far more interactive
Mawalla Group website that will encourage clients and subscribers to engage
the Mawalla Knowledge Base, archived copies of the Legal Bulletin and the
public domain pages of the Mawalla Corporate and Property Data Profiling
Systems.
“We concluded that it
is our patriotic duty to
Tanzania to build upon
our robust foundation
of solid legal practice...”

THE MAWALLA BULLETIN / GENERAL OPINIONS JUNE 2012 VOLUME 1
Current Law Reforms and the Issue of Bail in Tanzania
By Tanisa Towo
Introduction
A conflicting demand arises with regard to the issue of bail when an accused
person is taken into custody. This is because the law seeks to safeguard society
from the perils of being exposed to an alleged criminal; while on the other hand,
there is the fundamental principle of jurisprudence, which’s the presumption of
innocence until one is proven guilty.
“The issue is one of liberty, justice, public safety and burden of public
treasury, all of which insist that a developed jurisprudence of bail is
integral to a socially sensitized judicial process.” 1
The foundational basis of the Tanzanian legal system stems from the Constitution
of the United Republic of Tanzania of 1977 (as amended from time to time).
According to Article 13(6)(b) of the Constitution, no person charged with a
criminal offence shall be treated as guilty of the offence until proven guilty of
that offence.
Legal framework of bail
Before actually determining the place of bail within the human rights framework
as conferred by the Constitution, it is important to examine the object and
meaning of bail. By definition, bail is the release of an arrested person on a
promise that the person will appear before the court or police when asked to
and that the person will follow the conditions set by them. In law, the purpose of
bail is to “ensure that the accused will appear to take trial and not seek to evade
justice by leaving the jurisdiction of the court”. 2
In Halbury’s Laws of England, the purpose of grating bail is stipulated as:
“not to set the accused free but to release him from the custody of the law
and entrust him to the custody of his sureties who are bound to produce
him to answer on his trial at a specified time and place.” 3
In the Tanzanian legal system, the granting and denial of bail is dependent on
the gravity of the offence a person is charged with. According to the Criminal
Procedure Act of 1985, the CPA offences like murder, treason, economic
offences, terrorism and money laundering are non-bailable. 4 This rationale can
be found under section 148(5) of the CPA. Bail can either be police bail or court
bail as provided for under section 65 of the said law.
The challenge posed by the legal framework
The essence of this article is to address the issue of non-bailable offences against
the jurisprudential presumption of innocence that is enshrined in the Mother
law of Tanzania the constitution. It is an undisputable fact that the reason
why offences like murder and treason are non-bailable is fear for personal or
public safety or the suspect or accused would tamper with the evidence in
the administration of justice among other reasons. It is, however, not obvious
why an offence like money laundering should be non-bailable for the reasons
stipulated under the CPA against non bailable offences.
Why should the accused be denied bail Are we overruling the presumption
of innocence until proven guilty When and where does the innocence of the
accused cease to exist Is it after conviction or should it depend on the gravity
of the offence
The CPA provisions in non bailable offences contravene the superior provision
of presumption of innocence until proven guilty, hence unconstitutional
because until guilt is proven beyond reasonable doubt, the accused will have
“Before actually
determining the
place of bail within
the human rights
framework as conferred
by the Constitution, it
is important to examine
the object and meaning
of bail.”
1
Krishna Iyer J as quoted in Ray,
S “Right to bail in India.” Article
Source: http://EzineArticles.
com/914724
2
See Jaffer v R, (1972) HCD 92
3
The Advocate Vol 2 No 4 June
1993
4
See section 148 of the Criminal
Procedure Act 1985

THE MAWALLA BULLETIN / GENERAL OPINIONS DECEMBER 2011 VOLUME 1
been subjected to psychological and physical deprivation of liberty. This is
contrary to the stipulations of article 13(6)(b). It is an anomaly in the law that
needs be rectified as it manifests the impracticability of some provisions in the
Constitution.
Delayed investigation and trial processes are another major reason why the law
on non-bailable offences should be reformed to also accede the lord Justice’s
principle that “Justice delayed is justice denied”. It is unfair to remand an accused
in custody to await trial while subjected to the handicap of prison conditions.
The absence of a legal framework where one can demand/claim compensation
for wrongful detention in Tanzania fails the fundamental objective of upholding
the principle constitutional right of presumption of innocence.
Tanzania’s legal system mechanism is infected with the “investigation incomplete
(sic) syndrome”. More often than not the door is slammed shut through the
usual anthem:
“Your honour, the investigation is incomplete”.
It is used over and over in courts, notwithstanding the fact that innocent people
may then serve unjust time in jail and run a life span of their life time wasted
uncompensated.
A comparative study with other jurisdictions
In the United Kingdom, Section 114(2) of the Crown Prosecution Services
provides that “bail may not be granted to someone charged with murder unless
the court is of the opinion that there is no significant risk that, if released on bail,
that person would commit an offence that would be likely to cause physical or
mental injury to another person”. This provision upholds the practicability of the
fundamental constitutional and human right of presumption of innocence by
releasing the accused on bail, should the accused satisfy certain grounds of bail.
Recommendations
The issue is not for people to be denied bail, but rather to ensure an efficient
framework of investigation of grave offences and a speedy and fair trial. In other
words, the offence charge should be treated with equal weight to its gravity.
What we are calling for is to have speedy trials and investigation so as to curb
the predicament of unfair trials and elongated stays in jail. The ultimate goal is to
ensure that the constitutional rights of the accused are not compromised. The
net effect when a person is acquitted after a long period of unfair incarceration
is the same, whether the person is guilty or innocent. Our legal system is based
on fairness and equality, and to uphold that fundamental principle, the time has
come for the law-makers to learn from other jurisdictions and adjust our legal
framework.
Conclusion
The legislation governing the granting and denial of bail in Tanzania needs to be
reviewed, as it contravenes the constitutional presumption of innocence until
proven otherwise. The presence of non-bailable offences manifests the pieces
of legislations that are unconstitutional or rather a contradiction between
constitutional rights and judicial procedure.
Upholding the fundamental principle of the Constitution is of pivotal importance,
especially for a democratic country like Tanzania that upholds human rights as
its first priority.
“The legislation
governing the granting
and denial of bail in
Tanzania needs to be
reviewed,...”

THE MAWALLA BULLETIN / CORPORATE LAW REVIEW
JUNE 2012 VOLUME 1
Introducing the Mawalla Business Care Methodology
By PrayGod Manase
Doing business has not always been an easy task in developing countries like
Tanzania. In addition to the economic and infrastructural constraints, there are
a multitude of laws and regulations that have to be strictly adhered to, before,
during and after registration of a business.
Among other things, Tanzanian business law requires corporations to practice
proper corporate governance and management of, which record-keeping forms
an integral part.
Record-keeping is one of the most mundane but sophisticated requirements of
business processes. In addition to administrative, historical and archival reasons,
businesses keep records to fulfill legal requirements for their operations and
to protect the rights of stakeholders. Further, the maintenance of proper and
legally compliant records may help companies to avoid paying unnecessary fines
and get rid of lawsuit settlements costs.
It is a mandatory requirement under Tanzanian business law that business entities
keep an up-to-date record of their assets and financial records as per section 151
of the Companies Act, No.12 of 2002. It further requires that companies keep a
register of members, a registry of minutes and resolutions, registry of directors
and secretaries, registry of charges as provided for under sections 115, 148,
section 210, and section 96 the Companies Act, No.12 of 2002.
Fulfilling such requirements accurately and in a timely manner is a statutory
duty that should not be taken lightly by any business that aspires to excel at
the same time complying with the business legal requirements. However, this
has always been a great challenge to most business entities in Tanzania, as it
is not easy to actively engage in productive work and at the same time deal
efficiently with the paperwork. This has resulted in the imposition of fines by the
government, or even deregistration from the companies register of none legal
complying companies.
Recognizing this lacuna, the Mawalla Group developed a business procedure
package known as Mawalla Business Care to assist business entities to comply
with business laws and regulations, allowing the business to concentrate on
making profits and operationally efficient.
Business Care as a product ensures that the regulations required by the law
are all complied with, at an affordable cost; it legally and accurately keeps a
registry of your landed property offers a clear understanding of your business’
finances by drawing up legally compliant financial statements, introduces best
practices into your management decision-making, accurately and legally records
your company’s corporate information, and complies with all requirements of
Tanzanian commercial law.
The backbone of the Business Care package is two systems known as the
Property Data Profile (PDP) and the Corporate Data Profile (CDP).
The Property Data Profile provides an immediate, accurate and legally compliant
record of landed property; it provides the land tenure, property location, land
ownership history, title deed reference numbers, premiums and rentals paid
as per the requirements of section 31-35 of the Land Act No. 4 and the legal
requirements of the Village Land Act. No. 5 of 1999 respectively.
“Business Care as
a product ensures
that the regulations
required by the law are
all complied with, at an
affordable cost.”

THE MAWALLA BULLETIN / CORPORATE LAW REVIEW
JUNE 2012 VOLUME 1
The Corporate Data Profile provides for the mandatory requirements of the
Companies Act; it keeps a registry for the members of the company, a registry
of minutes and resolutions, a registry of directors and secretaries, and also the
charges created by the company.
All the information is stored in an easily accessible, transferable and user-friendly
format, and can be saved to a CD or USB flash drive, or printed as a hard copy.
It is also possible for clients to access the information anywhere in the world
through the Internet.
A business entity signing up for Business Care is guaranteed of total legal
compliance by the experienced experts in commercial law under our Corporate
Department of Mawalla Advocates, Mawalla Corporate Services and Mawalla
Financial Services.
The product is designed to take your business to new heights by handling all
legal requirements and paperwork, while you concentrate on maximizing profits
and expanding your business.
The Need for Company Secretaries in Tanzania
By PrayGod Manase
“Corporate governance is a need of the day in Tanzania and qualified company
secretaries are the means to provide.”
The profession of company secretary is one that has gained significant
importance in the corporate world over the years. It is a crucial and high-profile
position in the administration of a company. The growing importance of company
secretaries is a result of the increasing need for good corporate governance. 1
A company secretary looks after the regulatory compliance of the company and
ensures good corporate governance, i.e. making sure that everything being done
is as per the memorandum and articles of association of the company and within
the legal framework of the Companies Act. This means a company secretary has
to keep up to date with relevant legal, statutory and regulatory requirements
and best practice, which includes advising the board if it appears to be acting in
breach of legal requirements. A person holding this position should be able to
analyse and solve problems, have good communication and interpersonal skills,
have management and organizational skills, and understand the legal system
as it affects business. Not any person can carry out the duties of a company
secretary, as these key company officers operate in a niche area that not many
people in the organization will have knowledge of. It is therefore essential to
ensure that the company secretary is professionally trained. 2
In the Western world’s developed economies, where the need for company
secretaries was appreciated decades earlier, bodies for training personnel to
hold the position of company secretaries are long established – a decision that
has shown great success as far as corporate governance is concerned.
Among countries that are advanced in corporate governance, the United
Kingdom (UK) has a remarkable record: as early as 1902 it had established the
Institute of Chartered Secretaries and Administrators (ICSA) which has now
evolved into an institute with several divisions and students worldwide.
In most African countries, unlike in Western countries, the profession of
company secretary is at an embryonic stage, but has seen tremendous growth
“Corporate governance
is a need of the day in
Tanzania and qualified
company secretaries
are the means to
provide.”
1
Luke Thomas, Corporate
Secretarial Practice, ICSA
Publishing (2010)
2
Luke Thomas, Corporate
Secretarial Practice, ICSA
Publishing (2010)

THE MAWALLA BULLETIN / CORPORATE LAW REVIEW
JUNE 2012 VOLUME 1
lately. Among African countries, Zimbabwe, Ghana, South Africa, Kenya, Uganda
and Nigeria, to name but a few, have established institutes or bodies to ensure
quality and competence in the field.
As regards East Africa, conferences have been held to create awareness and
promote regional cooperation in matters of corporate governance. In 1998, it
was resolved that each state should be encouraged to develop both a framework
and code of conduct for company secretaries. 3 Kenya and Uganda 4 established
institutes of corporate governance and codes of best practice for corporate
governance.
Tanzania, on the other hand, is yet to keep pace with other countries in this
aspect; the Companies Act No. 12 of 2002 under Section 187 requires that each
company appoints a company secretary. It further provides that it is the duty of
the company directors to ensure that the company secretary is a person who
has the requisite knowledge and experience to fill the position. However, there
is no organization in place for the development of the profession, nor does
the Companies Act stipulate the qualifications for one to become a company
secretary, or the duties and responsibilities of one.
Furthermore, there is no separate legislation to guide the working of the
company secretaries. So, simply put, as opposed to other countries in East
Africa, Tanzania does not have the profession of company secretaries. Today
companies can recruit anyone for the position of company secretary for the sake
of compliance with the law, leaving aside the whole essence of the profession
– a practice which might lead to having laissez faire company secretaries, which
may in turn result in company failures.
Some shortcomings of this have already started to become apparent as it is
common to see advertisements for job opportunities that require certified
company secretaries - a qualification very few people in Tanzania have.
In addition, the opening of the East African common market could be better
utilized if we were better prepared in this respect. Our neighbor Kenya, for
example, has had the Institute of Certified Public Secretaries of Kenya (ICPSK)
for some time. This Institute was established and is governed by the Certified
Public Secretaries Act Chapter 354 of 1988 of the laws of Kenya, which provides
for the qualifications, regulations and penalties for company secretaries that
are qualified, competent and confident in the management of companies. This
poses a big challenge as to Tanzania’s ability to compete in the labour market in
the forthcoming East African common market.
Recognizing the need to provide company secretaries, a Mawalla Group
initiative will launch an integrated development programme to enhance the
capabilities and confidence of Tanzanian company secretaries, which will help
them to compete in the East African market in particular and the world at large.
This programme will be launched under the Tanzanian Institute of Chartered
Secretaries and Administrators (TICSA), as a division of the aforementioned
UK-originated Institute of Chartered Secretaries and Administrators (ICSA). The
programme is designed to share current insights and enable company secretaries
to explore real challenges with their peers. It will commence with in-house
training, especially in banks, before it opens its doors to independent students.
Corporate governance is an expanding issue of worldwide importance, as the
corporation has a vital role to play in national development and social progress.
It is the engine of growth internationally and increasingly responsible for
providing employment, public and private services, goods and infrastructure.
It is therefore undisputed that corporate governance is urgently needed in
Tanzania - and qualified company secretaries are the means to provide it.
“As regards East Africa,
conferences have
been held to create
awareness and promote
regional cooperation in
matters of corporate
governance....”
3
Private Sector Good Corporate
Governance Trust, Principles of
good corporate governance in
Kenya
4
The Institute of Corporate
Governance of Uganda (ICGU)
was established in 1998
for promoting excellence in
corporate governance in Uganda

THE MAWALLA BULLETIN / CASE LAW REVIEW
JUNE 2012 VOLUME 1
Admissability of Electronic Evidence in Court
By Tanisa Towo
Introduction
As digital technologies advance information sharing around the globe, Tanzania
still has room for improvement when it comes to admissibility of electronic
evidence in court. Electronic evidence here refers to documents produced
electronically such as emails and digital receipts. The Evidence Act of 1967
under sections 64, 65 and 79 does not have provisions recognizing electronic
documents as primary or secondary admissible evidence.
In this globalised era, almost all businesses and day-to-day human interactions
rely heavily on electronic communication. Business deals and banking
transactions, for example, are electronically administered. As the Tanzania
private sector strives to match the pace of the electronic business age, the
legal framework remains a challenge to achieving this goal. Recently, Mawalla
Advocates as a business law firm innovatively created a simplified electronic
system to archive property and corporate data but the question remained
whether the report produced by such a system could admissibly hold water in
court upon verification.
Position of the law with regard to the admissibility of electronic evidence
The foundation of the Evidence Act of 1967 of Tanzania is the Indian Evidence Act
of 1872 which were enacted at the time when technology was at infancy stage
in comparison to the recent era where technology is the driving force in almost
every transaction. There were neither computers nor sophisticated means of
transacting like there are more in recent years legislators accommodated a
few changes by amending the Evidence Act and introducing the Written Laws
(Miscellaneous Amendments) Act (No. 2) of 2006. However, these changes
were only confined to civil proceedings 1 (specifically banking) and criminal
proceedings , notwithstanding the relevance of other areas of transactions
and communications effected through electronic signatures via emails, text
messaging, etc.
Case law analysis
A recent landmark case that highlighted the lacunae in the law with regard
to admissibility of electronic evidence was the 2010 case 2 decided by
Honourable Judge Makaramba, in which the court laid down criteria to be met
in such scenarios that rendered the emails containing defamatory statements
inadmissible as evidence in court. This is due to the fact that the law does not
provide a comprehensive framework that recognizes electronic evidence. The
established criteria are not yet set aside by the highest court (Court of Appeal),
which would make a huge contribution towards development of the law on this
area and accelerate a remarkable departure from the older law. The judge in
this case adopted the approach taken by His lordship Nsekela 3 , who commented
that:
“The law must keep abreast of technological changes as
they affect the way we do business.”
The courts are evidently ready to accommodate the changes by setting guidelines
on a case-to-case basis, but these that are yet to be activated by the parliament
are inevitable mandatory. Judicial activism may, however, set precedents that
extend the interpretation of the law too far, thus creating loopholes for abuse
of electronic evidence recognition. Tanzanian law-makers should follow the
example of other jurisdictions like the United States of America, the United
Kingdom and our neighbour Kenya, who have already enacted specific rules
“The law must keep
abreast of technological
changes as they
affect the way we do
business.”
1
S. 40A Evidence Act 1967
2
Lazarus Mirisho Mafie v Odilio
Gasper Kilenga Commercial case
No. 10 of 2008
3
In the Trust Bank of Tanzania
v Le_Marsh Enterprises Ltd and
Two Others, Commercial Case
No. 4 of 2000

THE MAWALLA BULLETIN / CASE LAW REVIEW
JUNE 2012 VOLUME 1
and procedures to deal with such matters and the set up limitations for the
applications of the same.
Recommendations
Kenya, have amended s.65 of their Evidence Act that originated from the
same source 4 as ours, to accommodate technological changes and we are
not an isolated electronic business jurisdiction when it comes to electronic
evidence. Our Evidence Act of 1967 should be suitably amended, setting solid
guidelines and principles, addressing the courts on how to approach matters like
Authenticity, Hearsay and Relevance with set up limitations of the application of
the said law. Having such legislation in place will create an environment that is
conducive to business and social interactions taking place, while protecting the
subjects against unfair and unjust prejudices manifested by this lacunae in the
law.
As mentioned earlier, we are in a time where technology is an inevitable necessity
of our daily business dealings and social interactions. By not accommodating
these changes will resultantly hinder administration of justice and hence foster
for public none appreciation to a non dynamic legal system. This was evident in
the aforementioned 2010 case decided by Hon Judge Makaramba, in which the
defence lawyer used a two-pronged approach and a discrepancy in the law to
win a case that would have been decided otherwise had our Evidence Act of
1967 matched the pace of the technological changes that are evidently affecting
the way we do business.
Conclusion
On a conclusive note, a call for amendment of the Evidence Act of 1967 and
other related laws in Tanzania is inevitable. The 2010 case made a commendable
contribution by setting guidelines on admissibility of electronic documents
as evidence in court. However, to provide certainty in the law with regard to
this matter, the law has to be amended, as established in Mtikila case 5 , which
affirmed that the courts shall not step into the shoes of legislators. The current
restrictive lacunae in the admissibility of electronic evidence in civil suits needs to
be comprehensively attended if Tanzanian law is to keep pace with development
in the modern world of electronic evidence.
“... we are in a time
where technology is
an inevitable necessity
of our daily business
dealings and social
interactions.”
4
The India Evidence Act of 1872
5
Rev Christopher Mtikila v the
Attorney General, Civil Case
No. 5 of 1993 (High Court of
Tanzania)

THE MAWALLA BULLETIN / REAL ESTATE LAW REVIEW
JUNE 2012 VOLUME 1
How Unit Titles and Mortgage Finance are tackling the
Plight of Potential Home-Owners in Tanzania
By Tanisa Towo
Introduction
The uneven distribution of wealth in our country has resulted in a dramatic
population increase in urban areas, which has prompted the legislators to
enact accommodating laws which will enable people to own property in the
most convenient manner possible. This legislation is poised to facilitate property
development in urban areas and enhance the value of land in these areas.
To satisfy the new demands raised by the proliferation of apartments and
office blocks, a new legal structure called “Unit Title” was created by the Unit
Ttitles Act of 2008 (hereinafter “the Act”) to provide for multiple ownership
of common spaces and facilities - such as driveways and stairways - with the
objective of limiting urban sprawl, reducing the cost of urban living, improving
environmental conditions and generally making sustainable use of the land.
The legal framework of Unit Titles
The Act, also referred to as the Condominium Act in other jurisdictions, housed the
above-mentioned objectives that were not provided for previously,. For instance,
s.53 of the Land Registration Act Cap 334 did not allow the registration of a transfer
unless the division was vertical, but the Unit Titles Act provides for ownership of
strata titles under Section 5 1 of the Act. This provision puts Tanzania in line with
the structure of urban markets in developed countries, thereby enabling effective
exhaustion of a piece of land by appreciating its land value horizontally. This is to
say, if a piece of land is worth TZS10 million, its value can be multiplied by erecting
a property upwards, producing strata titles of the same value and more.
The Act offers attractive investment opportunities in construction and
development of condominiums, which ensures multiplicity of returns to investors
by providing for sectional property ownership and enhancing the value of a
property, which prior to the coming of the Act was of limited value. The result of
the growth in housing investment is an increase in employment opportunities in
the construction industry, which is a powerful force in alleviating poverty.
Furthermore, the Act seeks to remedy the scarcity of affordable urban housing
in the country by allowing public and private entities to construct numerous
units. For example, the National Housing Corporation’s action plan is to erect a
minimum of 15 000 units in the next five years. 2 This is a significant step towards
solving the housing shortage, a situation that is still quite pressing. For example,
as at 2010, Tanzania’s housing shortage was estimated at two million. It is also
an important step further in implementing the fundamental constitutional right
under Article 24 of the Constitution of the United Republic of Tanzania that
stipulates that every person has a right to own property. 3
In addition to that, no provision of sub-titles or condominium titles was made
in the Land Act Cap 113 on incidences of registration of granted right of
occupancy, other than co-ownership provisions, but the Unit Titles Act provides
for horizontal independent unit ownership of a property.
Experience from other jurisdictions suggests that a thriving housing market goes
hand in hand with mortgage finance. As Tanzania is a developing country with
a significant portion of the population being low-income earners, mortgage
finance provides a platform for funding the acquisition, construction and
upgrading of homes for the many lower income prospective home-owners 4 .
“Experience from other
jurisdictions suggests
that a thriving housing
market goes hand in
hand with mortgage
finance.”
1
Section 5 (1) of the Unit Titles
Act of 2008 describes a unit
property as including a single
building or several buildings
comprising sections of a unified
site together with the land on
which they are allocated and all
real rights exist in their favour.
2
According to a mission
statement by the National
Housing Corporation in 2010.
source:
3
24.- (1) Subject to the
provisions of the relevant laws of
the land, every person is entitled
to own property, and has a right
to the protection of his property
held in accordance with law.
4
According to a statement by
Mr John Murray McIntire, the
country director of Tanzania,
Burundi and Uganda from the
World Bank issued to The Citizen
Newsroom in 2010.

THE MAWALLA BULLETIN / REAL ESTATE LAW REVIEW
JUNE 2012 VOLUME 1
The enactment of the Unit Titles Act has allowed for independent ownership
of a unit, through which a unit owner can register a mortgage independently
as provided for under Section 33 5 of the Act. These reforms in the system of
titles have attracted large financial institutions like the World Bank to invest
in Tanzania’s nascent housing market in urban areas.
In redressing the problem of the housing shortage among low-income earners,
the government sought to formalise the budding mortgage industry by enacting
the Unit Titles Act and thereafter the Mortgage Financing (Special Provisions)
Act No 17 of 2008. This legislation provides real-estate developers with an
opportunity to build numerous houses for sale, which has significantly improved
the prospects of property ownership for low-income earners in Tanzania.
A formalised framework on regulations and how to manage multiple units in
a property has been put in place under Part V of the Unit Titles Act, which
addresses the issues that arise in common ownership of an area by several
people – problems include the maintenance and upkeep of the common areas.
Challenges
One of the major challenges hindering the workability of this promising legal
framework is the scarcity of long-term finance for the housing market. Despite
the accommodating legal provisions that are in place, the financial flow of
lenders is still wanting. The appreciating value of land is a positive factor for
investors, but has proved detrimental to would-be home-owners who depend
on mortgage finance to own property. Such commitments are lengthy (10 to 30
years) and uncertain for both parties, i.e. the lenders and the receivers, making
it an unproductive venture for the institutions that aim to realise quick profits.
There is presently a lack of private institutions that are ready to bear the lending
risks.
Conclusion
Unit Titles cannot thrive independently; certain factors have to be present in
order for their true impact to be realised. Unit Titles can release the masses
from the inadequacies of poor urban planning, but the mortgage finance
climate in Tanzania needs to be stimulated as a means to empower potential
home-owners in acquiring such ownership rights. With the right financing and
legal structure in place, Tanzania will be in a position to follow in the footsteps
of fellow African countries such as South Africa, which have been able to exploit
and enhance the value of land resources.
“The enactment of
the Unit Titles Act has
allowed for independent
ownership of a unit...”
5
Section 33 of the Unit Titles
Act of 2008: “The unit owner
shall have the right to mortgage
his unit in accordance with the
provisions of the Land Act.”