On 12 December 2025, the Minister of Industry and Commerce enacted the Indigenisation and Economic Empowerment (Foreign Participation in Reserved Sectors) Regulations, 2025, published as Statutory Instrument 215 of 2025.
These regulations were issued pursuant to section 3A of the Indigenisation and Economic Empowerment Act [Chapter 14:33] (“the Act”) which sets out the law on Reserved Sectors of the Economy.
Their core objective is to create a structured legal mechanism permitting foreign nationals, in strictly regulated circumstances, to participate in sectors officially designated as “reserved sectors.”
Under section 3A of the Act, reserved sectors comprise economic activities ordinarily restricted to Zimbabwean citizens.
These include passenger transport services, retail and wholesale trade, estate agency services, tobacco grading and packaging, grain milling, and artisanal mining, among others.
Although foreign participation is generally prohibited, section 3A(10) authorises the Minister to allow such participation through regulations wheredoing so advances the broader goals of indigenisation and economic empowerment. Statutory Instrument 215 of 2025 gives practical effect to that power.
The Requirements
Section 4(1) –(8) of the Regulations
- It is a requirement for a foreign person or entity who wishes to participate in reserved areas that the applicant be an individual or entity registered or incorporated in Zimbabwe even where majority or minority shares are foreign-owned serves several purposes. It ensures the entity falls squarely within Zimbabwean legal and corporate oversight structures in that locally incorporated entities are easier to regulate, audit, and sanction. It prevents direct offshore control without local legal presence. Importantly, the provision permits either majority or minority foreign ownership at the entry stage.
- It is also a requirement to meet prescribed investment and employment thresholds which creates quantitative entry barriers. These thresholds prioritise high-impact investments and align foreign participation with macroeconomic objectives (employment, capital inflows).
- It is a mandatory requirement for the foreigners to be registerd with the Zimbabwe Revenue Authority which ensures immediate fiscal integration; revenue collection from the outset and the prevention of informal or shadow operations.
- It is a requirement that the foreign businesses have a bank account under the Bank Use Promotion Act. Requiring a compliant local bank account promotes financial transparency, traceability of transactions and reduction of externalisation and illicit financial flows.
- The business plan requirement is arguably the most substantive element of the eligibility framework. It shifts the focus from mere capital presence to transformative impact. The applicant must demonstrate capacity to achieve:
- Significant and sustainable employment creation;
- Skills and technology transfer;
- Development of sustainable value chains;
- Other socially and economically desirable objectives.
Application Procedure
A foreign national who wants to operate in a reserved sector must apply to the Minister through the designated Unit for a permit.
The application must include:
- A copy of their investment permit (if they are already operating in the country).
- A copy of their business plan.
- Proof that they have sufficient financial resources.
- Any other supporting documents that the Unit reasonably requires.
The Waiting Period
- The Minister must consider the application within 60 days.
- The Minister may ask for more information if needed.
The Possible Outcomes
The Minister may:
- Approve the application and issue a permit,
- Grant an exemption certificate, or
- Reject the application.
- Conditions may be attached to any approval.
In terms of section 6 of the Regulations, foreign businesses already operating in the reserved sector must submit regularisation plans within 30 days of the regulations being published.
Foreign nationals in the sector are required to transfer at least 75% ownership to local citizens over three years, in annual instalments of at least 25%, leaving them with no more than 25% ownership at the end of that period.
Businesses that fail to comply risk suspension or revocation of their licenses.
Conclusion
Legally, the framework is robust and closely aligned with the objectives of the parent Act. Economically, it reflects a protectionist yet strategically selective approach permitting foreign participation only where it demonstrably advances employment creation, skills transfer, and sustainable economic empowerment within Zimbabwe.