Finance Law in Burundi
Burundi's financial legal framework has undergone significant reforms in recent years, aiming to enhance investment, improve public financial management, and align with international standards.
1. Investment Promotion and Export Facilitation:
- Investment Law of 2021: This law aims to promote and facilitate investment and exports in Burundi. It applies to various sectors, including agriculture, manufacturing, mining, tourism, cultural industries, and infrastructure. The law also covers the management of investment facilitation structures, such as Special Economic Zones, and coordinates state structures promoting investment in priority sectors.
2. Public Financial Management Reforms:
2022/2023 Finance Law Dissemination: In September 2022, Burundi's Ministry of Finance, Budget, and Economic Planning launched workshops to disseminate the 2022/2023 finance law. The initiative aimed to strengthen budget transparency, enhance public financial management, and improve communication between the government and citizens.
Recent Reforms: In 2020, Burundi revised several key laws, including the Insurance Act, Income Tax Act, VAT Act, and Tax Procedures Act. The Parliament also ratified the East African Community (EAC) Double Taxation Treaty. Additionally, the Insolvency Act was introduced in 2018, and revisions to the Commercial Act and the Code of Civil Procedure are under consideration to enhance commercial justice.
3. Financial Sector Stability:
- Financial Sector Stability Review: In early 2024, the International Monetary Fund (IMF) conducted a Financial Sector Stability Review (FSSR) mission in Burundi. The review aimed to assess the stability of the financial sector and provide recommendations for strengthening financial sector supervision and regulation.
4. Anti-Money Laundering Measures:
- Legal Framework: Burundi has established laws to combat money laundering and the financing of terrorism. The Financial Intelligence Unit (FIU) plays a crucial role in investigating financial crimes. However, challenges remain in effectively implementing these laws, and corruption continues to be a significant issue affecting financial governance.
5. Microfinance Regulation:
- Microfinance Law: Enacted in 2006, the law aims to protect savers and borrowers while minimizing risks associated with microfinance institutions (MFIs). Despite the legal framework, the effectiveness of MFIs varies, and there is ongoing work to strengthen this sector.
6. Financial Sector Developments:
- FinTech Initiatives: Proposed legislation is under consideration to manage customer data sharing in the financial sector, aiming to enhance data-driven financial services. This initiative aligns with global trends toward open finance and aims to improve consumer control over financial data.
These developments reflect Burundi's commitment to reforming its financial legal framework to attract investment, improve public financial management, and align with international standards. However, challenges such as corruption and the need for effective implementation of these reforms persist.
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