The laws relating to privatization of public corporations in Tanzania mainland

This study critically appraises the adequacy of the Laws relating to privatization of Public Corporations in Tanzania Mainland with special reference to divesture legal mechanisms under the official receivership of the Parastatal Sector Reform Commission (PSRC). It establishes that notwithstanding the fact that the privatization strategy presupposed reforms in the Laws to make them friendly with the new economic scenario, some of the Laws that are very much connected with the process have not been adequately reformed. The major Law governing privatization of Public Corporations, the Public Corporations Act 1992 and its 1993 amendments blindly adopt the procedures under the Bankruptcy Act to regulate divesture of Public Corporations. Nevertheless, in their nature the two Laws are irreconcilable, in that, whereas the batter is tailored to regulate individual insolvency, the former is intended to deal with the restructuring of both solvent and insolvent legal entities. Most of the Public Corporations envisaged under the Act were incorporated under the Public Corporations Act, 1969 and the repealed Companies Ordinance, Cap 212. The adoption of the procedures in the Bankruptcy Act to the divesture of Public Corporations was made without reforming the Bankruptcy Act to carter for the new role assigned to it. With this, it has been observed, there has been serious confusion and practical legal difficulties.