Notice on termination Bilateral Investment Agreement Netherlands - Tanzania

The Government of the United Republic of Tanzania notified the Government of the Kingdom of the Netherlands in September 2018 of its intention to end the existing reciprocal protection of investment treaty between Tanzania and the Netherlands. Despite efforts to seek a temporary extension of the existing treaty and/or a speedy start of negotiations for a new investment protection treaty no progress has been made so far.

The implication of this development is that as per 1 April 2019 new Netherlands’ investors inTanzania (and new Tanzanian investors in the Netherlands) can no longer rely on the preferential protection that the treaty provided. This means for new investors that they will have to rely onnational legislation and regulations for protection of their investment. It also means that they will have to seek legal redress, if and when needed, through national courts. Access to international arbitration will no longer be possible, unless a new agreement is reached that will cover that option.

However, existing investors should take note of the fact that the treaty’s comprehensive protection for investments made before the date of termination (1 April 2019) continues to apply for a period of fifteen years (until 1 April 2034). In view of the time needed for negotiations and ratification of an eventual new treaty the Embassy expects that it can take up to 3 to 5 years before an eventual new investment protection treaty becomes effective. Potential investors are advised to take this recent development into consideration when preparing decisions on investment in Tanzania.

Please do not hesitate to contact the Netherlands Embassy in Dar es Salaam in case further information is required via DAR-EA@minbuza.nl.