KAMPALA, UGANDA – Small and medium-sized enterprises (SMEs) in Uganda are facing significant challenges with regulatory compliance, with many entrepreneurs saying high costs and bureaucratic hurdles are stifling their growth and even forcing them out of business.
While government efforts have streamlined business registration through agencies like the Uganda Registration Services Bureau (URSB) and the Uganda Revenue Authority (URA), the process of obtaining product certifications from the Uganda National Bureau of Standards (UNBS) remains a major obstacle for manufacturers.
Ruth Apio, founder of Nutri-focus Food Hub, said her business journey has been stalled for months awaiting a UNBS quality (Q) mark for her products. After her goods were tested and approved, she has heard nothing from the agency for eight months, a delay she says has “interrupted my market penetration.”
The Cost of Compliance
Charles Ocici, executive director of Enterprise Uganda, said the financial burden of compliance is a key issue. Businesses must not only meet initial standards for products and services but also maintain them, a costly and ongoing commitment that many SMEs struggle to afford.
Joshua Mutambi, the Commissioner for Processing and Marketing at the Ministry of Trade, Industry and Cooperatives, added that businesses must also pay for UNBS officials’ transport to inspect their premises. Even after paying, he said, delays are common because the fees go into a central government fund, leaving UNBS with insufficient operational funds. This year, UNBS received Shs56 billion, which its executive director said was only a third of what the agency needs to function effectively.
Technology and Market Realities
Another challenge, according to Mutambi, is that many SMEs lack the technology required to meet quality standards. This creates a difficult choice for business owners who must either invest heavily in new technology or risk being unable to get their products certified.
Furthermore, many businesses launch products before seeking certification to test the market, a practice that is at odds with the legal requirement for a quality mark to be obtained before a product goes to market. This disparity, coupled with a market where consumers may not prioritize certified goods, means that compliant businesses may be at a disadvantage against competitors who do not follow the rules.
Ocici said the benefits of compliance, such as access to financing and new markets, often take a long time to materialize, while the costs and demands are immediate. He suggested that the government could help by subsidizing some compliance costs and focusing on long-term enforcement and public education.
