Trade ministry decries delays in Basotho empowerment regulations

’MATHATO SEBOKA

MASERU— The Ministry of Trade, Industry, and Business Development has expressed its disappointment over the delay in implementing regulations designed to empower Basotho entrepreneurs. It has urged the government of Lesotho to enforce these regulations immediately without any modifications. This comes after the Ministry filed a notice of motion on May 6 regarding the implementation of the Business Licensing and Registration Regulations, 2020, in Parliament.

As of May 1, the Ministry reiterated its dedication to enacting Section 34, which is reserved for indigenous Basotho items. To facilitate the implementation of Section 34, a task team comprising business associations and various government ministries was established. This team has recently renewed its commitment to diligently work towards the finalisation of this crucial exercise.

Section 34 of the Business Licensing and Registration Act and Regulations (Amendment 2021) includes provisions to protect and enhance the economic interests of indigenous Basotho by exclusively reserving certain items and sectors for their participation. These measures are essential for promoting economic equity and ensuring a fairer distribution of development benefits throughout society.

Following government policy guidelines, the Ministry has been advised not to apply the regulations retrospectively. Consequently, existing businesses licensed to operate in the reserved sectors will not be impacted by the new regulations and are permitted to continue their operations.

Moreover, the government has instructed a review of the 47 reserved business items to ensure comprehensiveness and to consider the potential withdrawal of certain items. In line with this directive, the Ministry, in collaboration with the task team, has begun revising the regulations and is engaging with the task team on the implementation of these updated regulations.

This initiative follows a recent demand by the Meat Traders Association through a petition to the registrar of companies, which threatened legal action unless the Ministry fully enforces the Business Licensing and Regulations 2020. The Association accused the registrar of selective law enforcement, focusing primarily on fee structures under Schedule 15, which led to increased fees, while neglecting other crucial aspects such as license issuance and renewal and the prevention of unfair business competition.

The Ministry faces a deadline by the end of this month to fully enforce the law, failing which the Meat Traders Association is prepared to file a mandamus application to compel the government to adhere strictly to its duties and correct any misapplications.

In their correspondence, Advocate T.C. Motloli, representing the Meat Traders Association, emphasised the need for comprehensive enforcement of the law to eliminate favouritism and discrimination between foreign and indigenous businesses, particularly in preventing unfair competition where foreign entities continue to operate in sectors reserved for locals.

The reserved sectors, which include about 47 business categories, allow foreign participation only as minority shareholders with no more than 49 percent of the shares. Key reserved sectors encompass international road freight transport logistics, motor dealerships, clearing agencies, warehousing activities, and retail sales of household fuels such as bottled gas or coal.

Also reserved are the fast food industry, hairdressing, beauty treatments, repair services, vehicle and motorcycle maintenance, photocopying, document preparation, specialised office support tasks, as well as wholesale and retail sales of alcoholic beverages (irrespective of consumption location) and meat products, including poultry.