South Africa: The Namibia Investment Promotion Act, 2016: Hindering Or Promoting Foreign Investment?

Last Updated: 20 July 2017
Article by Wolf Wohlers

Most Read Contributor in South Africa, July 2017

Foreign investors planning to invest in Namibia may have to jump over a few additional hurdles if the current version of the Namibia Investment Promotion Act, 2016 ("NIPA") is enacted. We understand that although NIPA was passed in August 2016, it is under review by the government. This development comes after the private and the public sectors raised concerns relating to the negative impact that NIPA may have on investment in Namibia.

NIPA is set to replace the Foreign Investments Act, 1990 and, if implemented, will result in far-reaching changes in the Namibian foreign investment regime. In comparison with its predecessor legislation, which provided for a free investment regime backed by institutional support, NIPA provides for an investment approval regime that affords wide-ranging discretionary powers to the Minister in charge of investments (whose identity has not been clarified in NIPA) to regulate and decide on investment matters, while also adding numerous procedural hurdles for the approval of investments and registration of investors.

NIPA, which is to commence on a date still to be determined by the Minister, has the objectives of providing a transparent framework for investment and promoting sustainable economic development through the mobilisation of foreign investments. However, among the many concerning contents, two aspects of NIPA have raised apprehension in the legal community and among investors, which have the potential to create an investment framework that could be susceptible to corruption and result in the proliferation of red tape for investors, manifestly contradicting NIPA's objectives of transparency and the mobilisation of investments. These two features are the discretionary power given to the Minister to reserve categories exclusively for certain categories of investors and the introduction of an approval and registration regime.

Reservation of categories by the Minister

NIPA gives the Minister the power to, by regulation, reserve certain categories of economic sectors or business activities exclusively for certain categories of investors, such as the State, Namibians or joint venture partnerships between Namibian and foreign investors. The Minister may also set out conditions that need to be met by investors, and may introduce incentives.

The Minister is therefore granted broad discretion to determine the types of investors that may invest in certain business activities or economic sectors. Although this could give the Minister the ability to ensure Namibian participation in the market, and therefore the growth of the Namibian economy, the possibility of abuse or manipulation is evident, as the powers could be used to completely reserve certain business sectors for the State, or exclude foreign investors from investing in specific business activities or economic sectors. The Minister's ability to introduce incentives and conditions could furthermore open the doors for potential corruption.

Registration of investors and approval of investments

NIPA requires investors that meet certain investment thresholds (to be determined by the Minister) to register with the Namibia Investment Centre. NIPA also provides that no foreign investor may invest in Namibia or acquire any licence, permit, authorisation or concession in Namibia through any form of merger, acquisition, direct or indirect sale or transfer without first receiving the approval of the Minister. It is this provision that changes the current investment regime from a free to an approval regime, and is likely to have two potentially far-reaching consequences.

Firstly, the administrative burden placed on the Minister to personally approve the registration of new investments could result in approvals being delayed. This may dissuade foreign investors from embarking on what could well be a burdensome process, and encourage them to rather place their investments in another country.

Secondly, the Minister's wide discretionary powers in approving and registering investments create an investment regime that could be dependent on personal style, preferences, intentions and whims of the incumbent Minister. Although NIPA does purport to set out criteria for the approval of investments, which the Minister must consider in order to determine a proposed investment's benefit for Namibia, these criteria are vague, and NIPA does not provide any further restrictions or checks and balances on the Minister's wide discretionary powers.

The verdict: hindering or enhancing investment opportunities?

Although NIPA's objectives are to promote transparency and the mobilisation of investments, the Minister's wide discretion to determine which investors may or may not partake in certain economic sectors and business activities could potentially result in excluding potential investors. Furthermore, the over-regulation of this field may slow down the investment process, leaving investors frustrated and dissuaded from investing in Namibia.

There is no indication when NIPA will commence, or what its contents will be. Although NIPA's objectives include promoting investment opportunities in Namibia, it is likely to hinder the investment process if it is enacted in its current form. To avoid this, NIPA will have to be redrafted to address numerous issues, such as the streamlining of its procedural aspects and introducing proper guidelines and limitations relating to the Minister's wide powers.

Stefanie Busch is a candidate attorney at ENSafrica in Namibia. This article was reviewed by Wolf Wohlers, a director at ENSafrica in Namibia.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.