11th Parliament Enacts Landmark Laws to Advance Uganda’s Oil and Gas Sector

As the 11th Parliament draws to a close, lawmakers passed three critical pieces of legislation aimed at facilitating and regulating Uganda’s oil and gas sector.

On December 9, 2021, Parliament enacted the East African Crude Oil Pipeline (EACOP) (Special Provisions) Bill, 2021. The law was designed to fast-track the implementation of the EACOP project by providing a clear legal framework for its operation. It defined the local content regime applicable to the pipeline to ensure meaningful participation and benefits for Ugandan citizens and enterprises, guaranteed third-party access to the pipeline, and set out the tariff structure to be paid for its use.

Subsequently, on December 14, 2021, Parliament passed the Income Tax (Amendment) Bill, which introduced a windfall tax and imposed limitations on allowable deductions in petroleum operations, strengthening the country’s fiscal regime for the oil and gas industry.

On the same day, the Public Finance Management (Amendment) Bill, 2021 was also passed. Its primary objective was to allow the Uganda National Oil Company (UNOC) to retain a portion of the proceeds from the sale of petroleum products, enhancing its financial capacity and operational sustainability.

Together, the three laws underscored the 11th Parliament’s focus on establishing a robust legal and fiscal framework to support Uganda’s emerging oil and gas sector and ensure greater national benefit from petroleum resources.