ABSTRACT
This study critically examines disputes over indirect expropriation in Tanzania, focusing on the tension between the State's sovereign regulatory authority and its obligations to protect foreign investors under international investment agreements. Following economic liberalisation in the 1990s, Tanzania adopted investor-friendly policies that encouraged substantial foreign direct investment, particularly in the natural resources sector. However, sweeping legislative and regulatory reforms introduced in the 2010s gave rise to a series of disputes in which foreign investors alleged that state interventions amounted to unlawful indirect expropriation under bilateral investment treaties. Using doctrinal and comparative research methods, the study assesses the sufficiency of Tanzania's domestic and international legal frameworks in managing these conflicts. The findings reveal persistent gaps, including unclear statutory definitions and inconsistent regulatory standards, which heighten the State's exposure to arbitration claims. While Tanzania frequently relies on public interest justifications, such as economic equity and resource protection, international tribunals increasingly evaluate disputed measures through principles of proportionality, legitimate expectations, and fair and equitable treatment approaches, which often favour investor protection. The study concludes that Tanzania should strengthen its legal framework and renegotiate treaty provisions to safeguard its regulatory autonomy better, while tribunals should adopt more balanced and predictable standards to ensure fairness and reduce future disputes.
Keywords: Indirect Expropriation; Public Interest; Legitimate Expectations; Foreign Investment; Regulatory Takings; Bilateral Investment Treaties (BITs).