Lack of harmonised laws across EAC hurting business – regional lawmakers

The lack of harmonised national laws among East African Community (EAC) partner states is negatively impacting cross-border business, members of the bloc’s legislative ssembly said on Tuesday in Kigali.
A truck crosses from Uganda to Rwanda through the Gatuna border. (File)
A truck crosses from Uganda to Rwanda through the Gatuna border. (File)

The lack of harmonised national laws among East African Community (EAC) partner states is negatively impacting cross-border business, members of the bloc’s legislative ssembly said on Tuesday in Kigali.

All Rwandan members of the East African Legislative Assembly (EALA) are in the country on a routine outreach and sensitisation programme.

 

On Tuesday, they held discussions with the National Monitoring Committee (NMC) on Non-Tariff Barriers (NTBs), where the issue of laws came up.

 

MP Patricia Hajabakiga, Chairperson of Rwanda’s EALA chapter, said, “The problem today is that the Common Market Protocol has no operational law at the EAC level. There should be harmonisation and approximation of national laws.”

 

At the Ministry of Trade, Industry and EAC Affairs (MINEACOM), a representative of Trinity Express Limited, a local bus company that started operating on the Kigali-Dar es Salaam route two months ago, said operations in Tanzania are hindered because their buses do not freely operate there.

Bishop Kihangire said, “We wanted to register as a foreign company but we were forced to register as a local (Tanzanian) company so as to fully operate,’’ he said. 

Each of the buses is charged $152 in road toll fee on entering Tanzania.

“We have buses with Rwandan number plates and others with Tanzanian number plates that cross the common border. When those with Rwandan plates cross into Tanzania they are charged but when those with Tanzanian registration enter Rwanda they are not charged.”

Lawmakers say Tanzania cannot be entirely blamed for the situation as the problem is largely due to the fact that the Council of Ministers has up to now not got its act together regarding legislation that would help in the implementation of the Common Market Protocol as was the case with the EAC Customs Union.

“Tanzania has its own laws, and we have ours, we may ease things for them but if they do not reciprocate, they would be in no fault as we have not harmonised the laws,” Hajabakiga said, adding that without harmonisation, there will be no obligation on individual member states to undertake the neccesary reforms. Politically, we can negotiate but, legally, we can not blame them.”

 Nathan Gashayija, the Director General in charge of EAC affairs at MINEACOM, agreed with the lawmakers.

Referring to the Common Market Protocol law (protection of cross-border investments), MP Martin Ngoga said partner states are to undertake to protect cross border investments and returns of investors of other partner states within their territories.

For the purposes of the latter, the protocol states that Partner States shall ensure: protection and security of cross-border investments of investors of other partner states; and non discrimination of the investors of the other partner states, by according, to these investors treatment no less favourable than that accorded in like circumstances to the nationals of that Partner State or to third parties.

“In case of expropriation, any measures taken are for a public purpose, nondiscriminatory, and in accordance with due process, accompanied by prompt payment of reasonable and effective compensation,” says the protocol.’’

It adds that, partner states shall within two years after coming into force of this protocol, take measures to secure the protection of cross-border investments within the Community.

Signed on November 20, 2009, the EAC Common Market Protocol entered into force on July 1, 2010. Six years down the road, the Community is yet to fully implement the protocol which was meant to boost trade across the bloc.

Given the present scenario, lawmakers advised traders to take advantage of the existing good political will of the present leadership.

MP Dr James Ndahiro said: “We would suggest that you use the bilateral approach and avoid the Common Market Protocol because it requires a law for implementation. Focus on bilateral negotiations and accept what they offer to you.”

Gashayija told the meeting that, among other things, bilateral negotiations have played a significant role in the eliminations of Non-Tariff Barriers (NTBs).

“The two ministers have agreed that we shall soon meet for a bilateral meeting between the ministries in charge of trade.”

MP Straton Ndikuryayo, a member of the  EALA Committee on Communication, Trade and Investment, advised local traders to always invest smartly.

Ndikuryayo said: “Before venturing into cross-border trade, it is important for traders to read and understand what the laws of a partner state say about a particular investment.”

Meanwhile, Safari Vincent, the Coordinator of the National Monitoring Committee on NTBs (NMC), a mechanism for identification, reporting, advocacy, monitoring of the removal of NTBs, told the meeting that, among other achievements, the road toll in Tanzania had reduced from $500 to $152 per truck per trip, and this enables transporters to save up to $800,000 per year.

Tanzania removed the requirement of cash bonds for transportation of sugar to Rwanda. Furthermore, he said, weighbridges in Kenya were reduced from six to four and from eight to seven in Tanzania.

After meeting with representatives of various private sector entities, the lawmakers visited the Rwanda Standards Board (RSB) offices. The ongoing EALA outreach and sensitisation programme in partner states started Monday and will end this weekend.

Yesterday, the MPs toured Rusumo and Gatuna border posts.

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