TANZANIA TIGHTENS CONTROL ON FOREIGN CURRENCY USE THROUGH NEW 2025 REGULATIONS
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Dodoma, March 28, 2025 — The Government of the United Republic of Tanzania has officially enacted the Foreign Currency (Use) Regulations, 2025 under Government Notice No. 198, pursuant to section 70 of the Bank of Tanzania Act [Cap. 197]. The new regulations are aimed at regulating the use of foreign currencies within the country and strengthening the use of the Tanzanian Shilling (TZS) in domestic transactions.
A. All Prices and Payments Must Be in Tanzanian Shillings
Under the new regulations, all prices for goods and services offered within Tanzania must be quoted in Tanzanian Shillings. Moreover, all financial transactions for goods or services occurring within the country must be conducted using the local currency.
It is now an offence for any person in Tanzania to:
1. Require or assist in setting prices for goods or services in foreign currency;
2. Quote, advertise, publish, or display prices in foreign currency;
3. Demand or facilitate payment for goods or services in foreign currency;
4. Refuse to accept Tanzanian Shillings as payment; or
5. Receive payment for goods or services within Tanzania in foreign currency.
B. Limited Exceptions for Foreign Currency Transactions
Nevertheless, the Regulations allow certain exceptions where foreign currency can be used. These include:
1. Government contributions to regional organizations based in Tanzania;
2. Transactions involving embassies and international organizations;
3. Loans issued in foreign currency by licensed banks and financial institutions within Tanzania; and
4. Purchases made in duty-free shops.
The Minister of Finance, in consultation with the Governor of the Bank of Tanzania, is empowered to amend this list from time to time.
C. Implications for Contracts Involving Foreign Currency
The Regulations also prohibit individuals or entities from entering into contracts that require payments in foreign currency for goods or services delivered within Tanzania, unless such payments fall under the permitted transactions listed above.
Importantly, any existing contracts concluded in foreign currency prior to the commencement of these Regulations must be amended to comply with the new regulations within one year of publication. Failure to do so will render such contracts void, unless an extension is granted by the Minister for a period not exceeding the remaining term of the original contract.
D. Conclusion: A Strategic Shift in Monetary Policy
With the enactment of these Regulations, the Government seeks to stabilize the local currency, curb inflation, and reduce the adverse impacts of uncontrolled foreign currency use on the national economy. All businesses, financial institutions, and individuals are urged to comply with the new legal framework to avoid penalties and support national monetary sovereignty.
