Compulsory acquisition in Uganda: constitutional guarantee, statutory process and the gap with lender standards

1. The constitutional and statutory frame

Uganda's constitutional settlement vests land in the citizens and recognises four tenure systems: customary, freehold, mailo and leasehold. Compulsory acquisition by the state is permitted for public purpose, subject to a guarantee of prompt payment of fair and adequate compensation prior to the taking of possession.

That guarantee — prompt, fair and adequate, and prior — is more demanding than it is often treated as being. Its three elements are distinct: adequacy concerns the amount, promptness concerns timing, and the requirement that payment precede possession concerns sequence. Projects that pay adequately but late, or that take possession pending resolution of disputed claims, are not in compliance merely because the sums are right.

2. Valuation and the district rate system

Compensation assessment operates through a system in which district land boards establish rates for crops and non-permanent structures within their jurisdictions, with valuations subject to approval by the Chief Government Valuer. The architecture is sensible: local rate-setting reflects local conditions, and central approval provides consistency and a check on the acquiring authority's self-interest.

Two practical problems recur. District rates are updated irregularly, so a schedule in force may substantially lag actual replacement costs, particularly during periods of inflation. And rates set for a district may not reflect the conditions of a specific locality within it, especially where a project has itself moved local prices.

Because rates are applied to enumerated quantities at scale, both problems propagate systematically rather than randomly, affecting whole classes of claimant identically.

3. Where lender standards go further

Four divergences matter operationally. National law compensates recognised interests; lender standards extend assistance to occupants without recognisable legal claim, so a project satisfying national law entirely may still owe assistance to informal occupants under its financing agreements.

National valuation practice may deduct depreciation from structure values, whereas replacement cost as required by lenders does not. Livelihood restoration as an outcome obligation has no direct national-law equivalent — the statutory scheme is compensatory rather than restorative. And lender standards require an accessible project-level grievance mechanism operating alongside, not in place of, the statutory objection and appeal routes.

4. Complementary, not conflicting

These divergences are additive rather than contradictory. Nothing in the lender requirements prevents compliance with national law; they impose obligations beyond it. The compliant position is therefore the union of the two, and a project that treats the CGV-approved valuation as the totality of its obligation has satisfied one regime and not the other.

The genuine difficulty is procedural. Statutory processes have their own sequences and timelines, and the project's safeguard instrument must be designed to run alongside them rather than duplicating or contradicting them — most visibly where a statutory objection process and a project grievance mechanism are both live on the same dispute, and a claimant must be told clearly which route preserves which rights.