The Zanzibar Business and Property Registration Agency (BPRA) has introduced Practice Directive No. 2 of 2025, establishing a minimum share capital requirement of TZS 100,000,000 for certain companies operating in Zanzibar.
This directive significantly affects foreign-owned companies and businesses operating in high-value economic sectors.
The regulation aims to improve business credibility, financial stability, and regulatory compliance in Zanzibar’s growing investment environment.
Companies Affected by the New Capital Requirement
The new TZS 100 million minimum capital requirement applies to two main categories of businesses.
- Companies with Foreign Shareholders
Any company that has foreign ownership, even if the foreign shareholding is very small, must maintain a minimum share capital of TZS 100,000,000.
This rule applies regardless of:
- The percentage of foreign ownership
- The number of foreign investors
- The company’s business activities
- Companies Operating in High-Value Economic Sectors
The directive also applies to companies operating in sectors that involve large financial transactions or major investments, including:
- Real estate and construction
- Import and export businesses
- Logistics and transportation
- Manufacturing and industrial production
- Tourism and hospitality
- Financial and investment services
- Mining, energy, and natural resources
- Telecommunications and technology
The Registrar may also apply this requirement to other businesses involving significant financial activities.
Steps to Comply with the New BPRA Directive
Companies operating in Zanzibar should take the following steps to ensure compliance:
Review Shareholding Structure
Confirm whether your company has any foreign shareholders.
Check Business Activities
Review the company’s Memorandum and Articles of Association to confirm whether it operates in regulated sectors.
Increase Share Capital
Pass a company resolution to increase share capital to TZS 100,000,000 or more.
Provide Proof of Capital
Submit supporting documents such as:
- Bank confirmation letter
- Bank statement showing capital deposit
- Certification from an auditor or accountant
File Changes with BPRA
Register the updated share capital with the Zanzibar Business and Property Registration Agency.
Consequences of Non-Compliance
Failure to comply with the directive may lead to regulatory action under the Companies Act, including:
- Refusal of company registration
- Rejection of regulatory filings
- Suspension of business operations
- Other measures determined by the Registrar
Important Rules About Share Capital
Companies should also note the following requirements:
- Share capital must be declared in Tanzanian Shillings (TZS) under the Companies Regulations 2017.
- The Registrar may require proof that the share capital has been fully paid.
- Acceptable proof may include bank statements or auditor confirmation.
Why the BPRA Introduced the New Rule
The directive was introduced to ensure that companies operating in Zanzibar:
- Maintain sufficient financial capacity
- Protect investors and stakeholders
- Improve transparency in business operations
- Align with international investment standards
This regulation strengthens Zanzibar’s reputation as a reliable investment destination.
Our experts ensure that your company meets all legal requirements when doing business in Zanzibar.
Reach to out Team at www.gerpatsolutions.co.tz , info@gerpatsolutions.co.tz, +244 742 826 955