Contracts and negotiations in Tanzania

What should you know about Tanzania’s business culture?

Tanzanian culture highly values establishing good relationships, and this reflects even in terms of business. Greetings are very important and should be given a fair amount of time since this will be the starting point of the business relationship. Small talk is encouraged to establish rapport, and topics such as health and family are most welcome in a Tanzanian business conversation.

Which negotiation tactics work best in Tanzania?

Dress in a formal and conservative attire when meeting with a potential Tanzanian business partner or client. Also, it is important to keep in mind that Tanzanians are fond of talking in a close range.

In terms of punctuality, time is a concept that is quite flexible in Tanzania, so expect that personal relationships and mutual trust are deemed more important than deadlines. Therefore, it is highly encouraged to emphasize the importance of deadlines and being on time so that no results of any business proposal or project will be compromised. Do this in the most respectful way possible, because being direct is actually equated to being rude in Tanzanian culture.

What is the pricing policy based on in Tanzania?

When dealing with price pressure, especially when convincing potential business partners or clients in Tanzania, knowing your product’s value and how it connects to the current business situation is a considerable advantage. Moreover, walking your client or partner through the costs of their not going with your proposal or project and making your client or partner realize the various benefits of your solution over the competitors are also other strategies that could be employed. However, keep in mind that all these techniques in overcoming price pressure must be done in light of the Tanzanian business etiquette.

Tanzania’s legal system

In Tanzania, the legal system is largely based on the English Common Law System derived from the legacy of the British colony. Section 2 of the Judicative and Application of Laws Act, Cap. 358 states that common law, together with doctrines of equity and statutes of general application, is enforceable, keeping in mind that this will always be in the jurisdiction of the people and the circumstances.

What are Tanzania’s litigation and arbitration processes like?

When it comes to settling commercial disputes, the main resolution methods employed by the Tanzanian government are litigation and arbitration.

Litigation has the Civil Procedure Code and High Court (Commercial Division) Procedure Rules to govern court procedures, including statements preparation, evidence, trial, and appeal.

Arbitration, on the other hand, has the Arbitration Act to regulate arbitration procedures, originally enacted in 1931 as was enforced by the English law. This act is now currently under review and a draft new law is under consideration by the Tanzanian government.

Prior to getting acquainted with the local business etiquette of Tanzania, however, it’s important to set your negotiation skills on the appropriate note for a successful business deal. It is, therefore, important to utilise the support of professionals in setting up your negotiation and advising you on various aspects of the alliance.

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