The World Bank has notified Uganda's government in a letter dated April 23 that a proposed law regulating recipients of foreign funding could obstruct its normal activities in the country. The draft legislation was tabled in parliament on April 15 by President Yoweri Museveni's government.
Under the proposed provisions, any Ugandan who receives funds from abroad would be required to register as a "foreign agent" and to disclose all incoming financial support. The bill's stated objective is to protect national sovereignty.
The draft further stipulates that individuals or entities designated as foreign agents would be prohibited from taking actions that impede implementation of government policy. It would also criminalize the development or promotion of alternative public policies without prior government approval.
In its correspondence to parliament, the World Bank said the law's scope could expose a wide range of the Bank's routine development activities to criminal sanctions. The institution specifically noted that tasks it commonly undertakes - including convening meetings where alternative policy options are discussed - could be vulnerable to criminal liability under the draft text.
"By classifying international organisations as 'foreigners' without qualification, the bill subjects them to all of its substantive restrictions, registration requirements, financial reporting obligations, and criminal penalties," the World Bank said.
The World Bank is a significant financier in Uganda, maintaining a project portfolio valued at about $4.57 billion in the country. The Bank halted new lending in 2023 after Uganda enacted an anti-homosexuality law, and it resumed providing funding two years later following agreed compromises.
Penalties proposed under the sovereignty bill include fines of up to 4 billion Ugandan shillings - about $1.08 million - and prison sentences of up to 20 years. The measure is currently being examined by a parliamentary committee.
The draft has drawn criticism from opposition politicians, non-governmental organisations and commercial banks, who argue it would constrain the flow of legitimate funds into Uganda. President Museveni has been in power since 1986.
Summary of concerns
- The World Bank says the law could subject routine development work to criminal liability.
- The bill requires registration and disclosure for recipients of foreign funds and forbids actions deemed to obstruct government policy.
- Proposed punishments include substantial fines and lengthy prison terms; the proposal is under committee review and has drawn domestic criticism.