Jitters in Uganda sugar industry as authorities declare newly issued milling licenses void 

UGANDA – In a significant development, Uganda’s Deputy Attorney General Jackson Kafuuzi has declared licenses issued to millers post the enforcement of the Sugar Act, 2020, as void.  

This announcement came during a session before the Committee on Tourism, Trade, and Industry on Thursday, November 30, 2023, responding to a petition by the Uganda Sugar Manufacturers Association against the licensing of new millers. 

The Sugar Act, designed to streamline the industry, led to the creation of the Sugar Board with the authority to issue licenses to millers. However, challenges arose in the implementation due to the ongoing rationalization of government agencies.  

In the absence of the established Sugar Board, the Ministry of Trade took on the responsibility of issuing licenses, granting approval to five millers, including Tyrol Investments Limited, Kikajo Sugar Limited, Bon Sugar Limited, Modern Agri Sugar Limited, Kelon Sugar Limited, and Shakti Sugar Limited. 

Deputy Attorney General Kafuuzi however clarified that the absence of the Sugar Board created a legal void, rendering any licenses issued without proper authority.  

He suggested the need for legislative amendments to establish the Sugar Council and rectify existing gaps in the law. 

Minister of State for Trade, Industry and Cooperatives, Hon. Frederick Ngobi, justified the issuance of licenses, explaining that they were based on consultations with the Uganda Investment Authority. He concurred with Kafuuzi’s stance on the need for an amendment to rectify the challenges faced by sugar millers.  

Ngobi also assured that the Ministry would take action against millers who failed to establish factories within the stipulated ten-year period, as mandated by the Sugar Act. 

The unfolding situation sheds light on the complex nature of implementing regulatory frameworks in Uganda’s sugar industry, necessitating a delicate balance between encouraging investment and adhering to legal protocols. 

Earlier, the minister of finance in the country while appearing before the parliament said the government has been unable to establish the sugar board to regulate the sugar industry due to the lack of the required funds. 

According to her, the sugar bill was assented to after the approval of the 2023/2024 budget, where the US$520,000 needed for the sugar board was not provided, and a decision has not been made to operationalize a sugar council as an interim measure.