Holding Land in Tanzania: Derivative Rights and Investor Leases

This page is the investor land-tenure operating file: which instrument a non-citizen may lawfully hold, who grants it, for how long, and what clears before it binds.

• Picking the instrument: certificate of occupancy, derivative right or sublease
• The ownership question: can foreigners own land in Tanzania?
• Duty on the paper: stamp duty on business documents
• When the shares move instead: capital gains tax on shares

As at 14 September 2026. Confirm the live position at lands.go.tz and with TISEZA. This file rests on Cap. 113, Cap. 114, Cap. 334 and the Tanzania Investment and Special Economic Zones Act, 2025.

Public land, the President, and the bar in section 20

The Land Act vests all land in Mainland Tanzania in the President as trustee for citizens, sorted into general, village and reserved land. Nobody owns land here. What exists is a right of occupancy: over general and reserved land, granted through the Commissioner for Lands for up to ninety-nine years and registered under Cap. 334. Village land carries customary deemed rights.

Out of that right its holder may carve a derivative right: the Act’s term for an interest created out of a superior title: a lease, a sublease, a licence, a usufructuary right. The parent title stays put; the carved term ends first.

Section 20 states the rule every foreign investor works around: a non-citizen shall not occupy, use or deal with land to which the Act applies. Section 19 and the balance of section 20 give the exception: land held for investment purposes, allocated to the investment authority, which creates derivative rights for investors. A body corporate counts as a citizen only where citizens hold the majority of its shares, so a Tanzanian subsidiary of a foreign parent is a non-citizen for tenure. GN No. 487A of 2025 separately reserves business categories to citizens.

Which instrument, which grantor, which consent

Inside a TISEZA derivative right

The Tanzania Investment and Special Economic Zones Authority now carries functions the Tanzania Investment Centre and EPZA held separately, and the TIC land bank came with them. Deeds in the Centre’s name still run; new instruments issue in the Authority’s name.

Land earmarked for investment is identified, converted to general land where it began in a village, and a right of occupancy issued in the Authority’s own name. The Authority then grants the investor a derivative right by deed for a defined project. Until that deed is registered it binds two parties and nobody else: no mortgagee, liquidator or later purchaser.

Access runs through the investment approval. Part III, section 19 of the Tanzania Investment and Special Economic Zones Act, 2025 sets minimum investment capital at USD 500,000 for a foreign-owned or joint-venture project and USD 50,000 where it is wholly citizen-owned; confirm the live threshold on tiseza.go.tz. Land rent stays charged on the head title and is recovered from the derivative-right holder; a premium falls due on grant. Note the arithmetic: a ninety-nine-year head title supports ninety-eight years below it, never a match.

Taking a lease from a private title holder

Most foreign-backed occupation in Dar es Salaam, Arusha and Mwanza runs this way, not through the land bank, whose urban stock is thin: a citizen holder, or a company the Act deems a citizen, leases to the investor’s local company.

Two gates stand in front of it. The disposition needs the Commissioner’s written approval before it operates, applied for on the prescribed Land Form with the title and a clean rent position behind it. Registration at the zonal land registry follows. Where an individual disposes of the matrimonial home, spousal consent belongs in the pack.

Search the title before drafting: unexpired term, mortgages, caveats. A lease longer than what remains takes effect only for what remains, so ninety-nine years over a sixty-one-year remainder is a sixty-one-year lease with a marketing problem. Read the endorsed land use against the intended operation: a residential endorsement will not carry a warehouse. And expect the desk to ask what investment approval stands behind a long term to a foreign-controlled tenant.

Village land is not investment land until the President moves it

Village land sits with the village council on the assembly’s authority, and no derivative right over it reaches a non-citizen. It must first be transferred to general land by the President: a process that takes the assembly’s views, settles compensation to every displaced interest, and ends in a transfer order published in the Gazette.

This is where large agricultural files die. An investor signs with a council for several thousand acres, pays, collects receipts, and holds nothing registrable. Beyond the acreage a council may allocate on its own authority, the district and the Commissioner enter the file; check the ceiling before money moves.

From plot to registered instrument

1. Name the project and the jurisdiction. Activity, plot, floor area, Mainland or Zanzibar. The instrument follows the use; the use follows the licence.
2. Screen your own vehicle. Apply the majority-shareholder test, check the activity against GN No. 487A of 2025, and decide whether incentives are needed.
3. Search the register. Title number, registered holder, unexpired term, encumbrances, caveats, endorsed use, rent account.
4. Pick the route. Apply to TISEZA for an allocation, or negotiate with the registered holder. On village land, start the conversion first.
5. Execute, then apply for approval. Sign in counterparts and lodge the prescribed application with the Commissioner, with title, consents and company papers behind it.
6. Stamp inside thirty days. The Stamp Duty Act Cap. 189 charges a lease at 1% of annual rent reserved and a premium as a conveyance at 1%; pay on the GePG control number.
7. Register, then open the accounts. Lodge the stamped instrument, collect the registered copy, and set up rent, rates and the renewal diary.

Papers the Authority and the registry ask for

From the land side: the certificate of title in the grantor’s name, survey and deed plan, rent clearance, the executed instrument in counterpart, the prescribed disposition application, the mortgagee’s consent where the title is charged, spousal consent where it applies, and a valuation report where a duty base must be fixed.

From the corporate side: certificate of incorporation, memorandum and articles, a current BRELA extract showing directors, shareholders and beneficial owners, the board resolution naming the signatory, the TIN certificate, plus investor passports, permits and source-of-funds evidence. Where TISEZA grants, add a costed business plan, proof of the investment capital, the implementation timetable and the incentives certificate.

Illustrative arithmetic, not a quotation

A foreign-owned company takes a twenty-five-year lease of a surveyed 4,000-square-metre industrial plot in Dar es Salaam at TZS 9,000,000 a month, with a premium of TZS 120,000,000 on signature. Assume ground rent assessed at TZS 400 per square metre a year: an assumption, not a published rate.

• Annual rent reserved: TZS 9,000,000 × 12 = TZS 108,000,000.
• Duty on the lease at 1%: TZS 1,080,000.
• Duty on the premium as a conveyance: 1% of TZS 120,000,000 = TZS 1,200,000.
• Ground rent assumed: 4,000 × TZS 400 = TZS 1,600,000 a year, billed to the holder and recharged under the lease.
• Duty to clear before the registry acts: TZS 2,280,000, on its own control number.

No approval fee, registration fee, survey, valuation or council rate is inside that figure. Each is a separate desk.

Transfer, assignment and change of control

A derivative right is not freely assignable. Where the Authority holds the head title, its deed conditions assignment on written consent given against the project the incentives certificate describes: a new controller is a new investor and a fresh application. Where the head title is private, the assignment is another disposition needing approval and registration.

Tax attaches before the title moves. On realisation of an interest in land or buildings the Income Tax Act Cap. 332 charges a single instalment on the gain (10% for a resident, 20% for a non-resident), and the registry expects TRA evidence. The transfer instrument carries duty at 1% of consideration or the Valuer’s figure, whichever is assessed.

Selling the shares of the company that holds the right does not step around that. Section 56 of Cap. 332 treats a change in underlying ownership of more than 50% across any three-year period as a realisation of the entity’s assets, so an offshore sale crystallises Tanzanian tax while the register never moves.

Where the file stalls

• A foreign-owned company named as buyer for a granted right of occupancy: duty paid, deposit gone, transfer declined.
• Arrears on the grantor’s rent account surfacing at the approval desk, the deal waiting on an old bill.
• A deed signed, stamped and never registered, discovered when the grantor’s bank appoints a receiver.
• Village land bought with minutes and receipts but no Gazette transfer order, years after the first tractor arrived.
• A plot endorsed residential carrying a production line, change of use raised after the machinery landed.

Zanzibar runs its own tenure and its own authority

Unguja and Pemba sit outside everything above. Land there is governed by the Land Tenure Act No. 12 of 1992, vests in the Government of Zanzibar, and is administered through the Commission for Lands: its own office, forms and registry.

Investment approvals run through the Zanzibar Investment Promotion Authority, and a non-Zanzibari ordinarily takes an interest in an approved real-estate development on the terms that approval fixes. Companies register with BPRA; instruments are stamped by the Zanzibar Revenue Authority. A Mainland consent carries no weight there, though income tax on the gain stays a Union matter at TRA.

Desks this file does not replace

The Commissioner for Lands approves dispositions; the Registrar of Titles registers what is approved. TISEZA allocates investment land and issues the incentives certificate. The village assembly controls village land until the President transfers it. The district council issues change of use and building permits; the Chief Government Valuer sets value. TRA assesses duty; BRELA keeps the shareholding record the majority-citizen test reads. Zatra structures the route and sequences the desks; it does not practise law, value land or issue title.

What to confirm before you act

• Whether your vehicle is a citizen for tenure: tested on the shareholder register, not the place of incorporation.
• Whether the activity is open under GN No. 487A of 2025, before any deposit is placed.
• The class of the land, and for a village plot whether a transfer order exists.
• The unexpired term, encumbrances and endorsed use, from a search dated within days of signature.
• Which consent applies: the Authority’s, the Commissioner’s, or both.
• The live ground-rent assessment at the zonal land office and the duty rows on tra.go.tz.

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Investing in Tanzania

The restriction sits on the licence, not on the company.

• The 15 activities reserved to citizens, and the sector ownership rules
• The vehicle, BRELA registration, the TISEZA certificate and the tax that follows
• Permits, land, and the gates in mining, energy, agriculture, services and industry

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