The Minister of State for Finance in charge of Planning Hon. Amos Lugoloobi has asked lawmakers to conduct extensive research on the Local Content Bill arguing that in its current form, 90 per cent of the proposed law is procurement related.
The Private Member’s Bill seeks to impose local content obligations on a person using public money or utilizing Uganda’s natural resources or carrying on an activity requiring a license.
It further aims to ensure Ugandan citizens, residents and companies are prioritized in public procurement.
It also seeks to ensure skills and technology transfer to Ugandans as well as provide for provision for development of local content plans, supervision, coordination, monitoring and implementation of local content.
Lugoloobi said that what is in the Bill is not comprehensive enough to cover issues of local content.
He made these remarks while appearing before the Finance Committee to present the Ministry’s views on the Bill on 09 August 2022.
Lugoloobi also advised MPs against passing a provision which prioritises Ugandan goods and services during procurement saying that this contradicts the East African Community Protocol on free movement of goods and services.
“The protocol is about free movement of goods and services and you cannot legislate against it. We send legislators from here to the East African Legislative Assembly and now here we are with a legislation which ties us,” he said.
He said that the matter should be left at policy level pending consultations with the Minister for East African Community Affairs.
“We should not escalate this to a level where we legislate for it, we can quietly manage it. Making it a law, will be a very big contradiction and very soon it will be challenged in court,” he said.
The Committee Chairperson, Hon. Kiwanuka Keefa however, wondered why Uganda should not prioritise its goods and services during procurement and yet other East African Community (EAC) countries are prioritising theirs.
He said that Tanzania has a local content law which makes it difficult for procurement of goods and services from other countries although they are within the EAC.
“Even in Kenya, they are developing the Local Content Bill. We are talking about goods which are produced in Uganda and according to the Investment Code that allows goods from across East African Community,” said Keefa Kiwanuka.
Committee Vice Chairperson, Hon. Jane Pacuto Avur said that each country in the EAC was left to legislate on matters of procurement of goods and services to decide and manage.
“Coming up with this law will not have an impact on the EAC Protocol,” said Avur.
Hon. Muhammad Muwanga Kivumbi (NUP, Butambala County) proposed incorporation of the Investment Code in the Bill.
“Other than total rejection of the clause, we can see how we can borrow that provision which defines a local investor and address the concerns of the minister,” Muwanga Kivumbi said.