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BY Phillip Karugaba , Rehema Nakirya Ssemyalo AND Renata Nyakairu
Bank of Uganda exempted from blanket statutory immunity
The Minister of Finance has issued an instrument lifting the blanket immunity from execution against the assets of the Central Bank of Uganda. The exemption was given in the Public Finance Management (Exemption of Specified Protected Assets) Instrument 2024, published on 26 July 2024.
In our article on The Public Finance Management (Amendment of Schedule 4) Instrument 2023, we pointed out that the pledging of certain national assets to secure loans for the Government was prohibited and that certain assets, including all financial assets of the Bank of Uganda, were protected from any form of execution. We further pointed out certain legal, constitutional and commercial issues which would arise from the instrument.
This exemption now addresses the commercial needs of the Bank of Uganda and places it in a better position to enter into contracts where its counterparties may require assurance of recourse against its assets. It is expected that other entities like Uganda Airlines will follow suit.
The broader concerns on the legality of Schedule 4 remain and will hopefully be addressed in a pending legal challenge.
Phillip Karugaba
Partner | Uganda
Rehema Nakirya Ssemyalo
Partner | Uganda
Renata Nyakairu
Associate | Uganda
