Are sealed bids an auction under Tanzanian law? Not necessarily. A sealed round in which the owner invites expressions and chooses any counterparty looks like an invitation to treat, not an auction. But the Auctioneers Act treats selling by competitive bidding as the business of an auctioneer, and whether a closed sealed round counts is untested. Use a licensed auctioneer for open bidding and take advice on the structure.
What the law says
Three Acts frame the subject. The Sale of Goods Act, Cap. 214 deals with auction sales at section 59. The Auctioneers Act, Cap. 227 licenses the people who sell by competitive bidding. The Law of Contract Act, Cap. 345 sets how an offer and an acceptance make a contract. A fourth, the Anti-Money Laundering Act, Cap. 423, lists auctioneers among reporting persons.
The research behind this guide read the Acts on TanzLII through a summary tool, so section numbers are as returned and subsection lettering should be checked before a pinpoint citation. A Tanzanian court decision squarely on private sealed-bid tenders and a seller's right to refuse the highest bid was not found.
Fursa365 runs three different routes. A deal round takes sealed expressions of interest until a closing time and the owner chooses. A private tender is invitation-only. The auction room is open bidding by Kasongo Auction Mart Limited, a licensed auctioneer. In all three Fursa365 never holds money.
Who should read this
Owners selling or hiring out vehicles, machines, stock, land, livestock or a stake and choosing how to run the process. Buyers and hirers who bid. Auctioneers, brokers and property agents. Advocates and accountants advising on tender terms, reserve prices and records. Procurement staff comparing private rounds with public disposal.
Sealed round, private tender or auction?
| Point | Deal round | Private tender | Licensed auction |
|---|---|---|---|
| Who is invited | Verified parties on the platform | Invitees the owner names, each verified | Registered bidders |
| How bids arrive | Sealed, until a closing time | Sealed, under the NDNCA | Open, in the room or online |
| Who decides | The owner chooses one counterparty | The owner chooses | The hammer closes each lot |
| Who runs it | Zatra screens; the parties contract | Zatra screens; the parties contract | The licensed auctioneer |
| Where money sits | Between the parties, never the platform | Between the parties | With the auctioneer under its terms |
| Fits | Competing demand, price is one factor among several | Assets the owner does not want seen in public | Outright sale of vehicles, machines, goods, livestock and property |
Fursa365's auction room does not auction minerals, licences or shares. A stake in a company goes through a round or a private tender, never the hammer.
Is a sealed round an auction under the Auctioneers Act?
The Auctioneers Act, Cap. 227 defines an auctioneer as any person selling by auction. As read, section 3 deems anyone selling movable or immovable property, or an interest in it, by competitive bidding to be carrying on the business of an auctioneer. Section 4 requires a licence, and section 6 makes the Permanent Secretary to the Treasury the licensing authority. The fee register lists the auctioneer licence at TZS 150,000 for a calendar year and TZS 75,000 for a half year, applied for on the GAMIS portal, with a separate council business licence for auctioneers at TZS 150,000 (register IDs NEW-08-17 and BLB243).
Section 20 lists exemptions, which include a person selling their own property. So an owner running a sale of their own asset needs no auctioneer licence, as the research reads it. A third-party house, or an agent running competitive bidding for an owner, falls inside sections 3 and 4. Whether a closed sealed-bid round is "competitive bidding" under section 3 is untested, and no authority was found. The Auctioneers Rules, 1929 could not be read.
That uncertainty is the reason Fursa365 keeps the routes apart. In a deal round the owner chooses, price is one factor and no bidder wins by being highest. Open bidding goes to a licensed auctioneer.
What does the Sale of Goods Act say about auctions?
As returned from the Act, section 59 treats each lot as a separate contract. The sale is complete when the auctioneer announces it, for example by the fall of the hammer, and until then any bidder may retract a bid. Without a notified reservation of a right to bid, the seller may not bid or use shills, and the buyer may treat such a sale as fraudulent. A sale may be notified as subject to a reserve or upset price, and a right to bid may be expressly reserved. Only with that reservation may the seller, or one person for the seller, bid.
Two practical points follow. A bidder in an open auction is not bound until the hammer falls. An owner who wants to bid on its own lot, or have someone bid for it, must say so in advance. These rules apply to auctions of goods. A sealed round is not governed by them unless it is an auction.
Is a sealed bid an offer, and can the owner refuse the highest?
Under the Law of Contract Act a proposal may be revoked at any time before the communication of its acceptance is complete. Acceptance must be absolute and unqualified, and it is complete against the proposer when put in course of transmission. The Act does not say that a tender invitation is an invitation to treat.
The High Court did say so in Thumbsup Company Limited v The Board of Trustees of Ifakara Health Institute, Civil Appeal No. 25867 of 2023, judgment of 14 June 2024, which upheld the finding that an advertisement for tenders is an invitation to treat and not an offer. Counsel cited a textbook for the point that an invitor need not accept the lowest tender, but the court did not adopt it as its holding. The decision supports "an invitation is not an offer". It does not hold that an invitor may refuse the highest bid.
The safe drafting is therefore to say it. A round's terms should state that expressions are not offers, that the owner may choose any counterparty or none, that a binding contract exists only when both sign a written agreement, and that the reserve or floor is stated. Fursa365's round rules work this way, and the advocate drafts the final agreement.
What must an auction notice or catalogue say?
Section 17 of the Auctioneers Act requires the sale particulars to state whether the sale is without reserve, with a reserve or with a reserved right to bid, as read, and sets seller-bidding rules. A land sale needs at least 14 days' notice under section 12(2). The money amounts in the Act are old colonial figures and do not govern current fees.
A catalogue should also state the lot, the owner's documents, the condition, the viewing time, the registration and deposit terms, who holds deposits, the sale note and invoice, and the settlement date. On Fursa365 the auctioneer, not the platform, registers bidders, verifies identity, holds any deposit and issues the sale note.
When is an auction required or regulated?
Some sales must follow a statutory route. Court-ordered sales are conducted by court brokers. The Court Brokers and Process Servers (Appointment, Remuneration and Disciplinary) (Amendment) Rules, 2019, Government Notice 106 of 1 February 2019, amend the principal Rules of 2017. Rule 25(7) says every sale in execution of a court order shall be by public auction, with 25% of the price due at the hammer and 75% within 15 days, as read in the gazette copy. The working name "Auctioneers and Court Brokers Rules" is incorrect.
A mortgagee sale is regulated under the Land Act, Cap. 113, Part X, where the table of contents lists sections on the power of sale, the lender's duty on sale and protection of the purchaser. The body text was not read, and one law firm's section numbers conflicted with the contents, so cite none without checking. Public assets are disposed of by tender under the Public Procurement Act, 2023, with tender board approval. A private round does not replace any of these.
What are the anti-money laundering duties?
The Anti-Money Laundering Act, Cap. 423 R.E. 2019, section 3 lists reporting persons, including auctioneers, real estate agents, accountants and dealers in precious stones or metals. Advocates and notaries are included when assisting with listed transactions. The Financial Intelligence Unit's compliance guide of January 2023 says auctioneers are covered when they prepare for or carry out financial transactions for clients. It describes customer due diligence with a 20% beneficial-owner threshold, suspicious transaction reports within 24 hours, and records kept at least 10 years. The Act was revised in 2022, so check current numbering.
Two private parties selling directly are not reporting persons on that reading. A licensed auctioneer, a land or gem broker, or an accountant or lawyer structuring the sale probably is. Fursa365 holds no money, but it asks for identity and beneficial ownership at screening for the same reasons.
What tax and duty apply?
The sale of a vehicle, machine or stock lot may carry stamp duty on the instrument and, for a VAT-registered seller, VAT at 18% (register ID F0239). The research found no rule on VAT or stamp duty specific to auctioned goods. The Finance Act 2026 extended the stamp duty definition of property to movable property, as Clyde and Co reported. A lease of movable property now carries stamp duty at 1% of annual reserved rent (register ID F0265). A conveyance of land carries nil to 0.5% then 1% of value above TZS 100,000 (register ID F0262). An agreement is TZS 2,000 (register ID F0267).
The seller's accountant confirms the position. The auctioneer's commission is set by its terms and no statutory figure was found.
How should a round's terms be written?
- State the asset, the closing time and the floor, as a band where price is sensitive.
- State that expressions are not offers and the owner may choose any counterparty or none.
- State the screening: identity, mandate, capacity and the NDNCA before names move.
- State that a binding contract arises only on a signed advocate-drafted agreement.
- State who holds money. In a round, nobody holds money for the platform.
- State any condition, such as a consent from a lender, a regulator or a co-owner.
- State what happens if no expression meets the floor.
A worked example: a warehouse lease round and an excavator auction
An owner has a 2,000 square metre warehouse near Kibaha and two excavators. For the warehouse the owner runs a deal round with a floor of TZS 9,000 per square metre a month. Five verified expressions arrive, from TZS 9,500 to TZS 14,000. The owner chooses the TZS 11,000 offer because the tenant also offers a 36 month term and a deposit of three months. The rent is TZS 22 million a month, TZS 264 million a year. Stamp duty at 1% of annual rent is TZS 2.64 million (register ID F0265). The owner's advocate drafts the lease.
For one 20 tonne excavator the owner wants an outright sale. It is referred to the licensed auctioneer with the owner's documents and a reserve of TZS 160 million. Bidding opens at TZS 180 million. The hammer falls at TZS 185 million and the auctioneer issues the sale note. The owner may bid on its own lot only if the sale was notified as with a reserved right to bid. The figures are illustrative.
The owner chose a round where terms mattered and a hammer where price mattered most. The two routes do not mix on one lot.
What to do now
- Decide what matters: price alone, or price, term and counterparty quality.
- Choose the route: a deal round, a private tender, or a licensed auction.
- Collect the evidence: title or card, licences, condition, valuation and any lender consent.
- Set the floor or reserve and write the terms down, including the right to choose or refuse.
- Sign the NDNCA before names move, and run your own due diligence.
- Let an advocate draft the agreement and stamp it.
- Keep records: identity, beneficial ownership and the sale note for the period your accountant advises.
Key dates
| Item | Date or period |
|---|---|
| Deal round closing time | 17:30 East Africa Time on the stated date |
| Land sale by auction, notice | At least 14 days, Auctioneers Act section 12(2) as read |
| Sale in execution, payment | 25% at the hammer and 75% within 15 days, rule 25 as read |
| Auctioneer licence | Calendar year or half year (register ID NEW-08-17) |
| Suspicious transaction report | Within 24 hours, as read in the FIU guide |
| Stamp duty on a Mainland instrument | Within 30 days of execution |
How Zatra helps
Zatra Consultants Limited screens the offer and every expression, verifies identity and capacity, and structures the round or tender terms. As the client's adviser under a PSFA, Zatra coordinates the client's advocate and records the outcome. For open bidding Zatra refers the lot to Kasongo Auction Mart Limited, a separate company in the Zatra group, which conducts the auction under its own licence. Zatra does not license auctioneers, hold deposits, act as an escrow agent or give legal opinions. The Treasury and the Financial Intelligence Unit decide their own matters, and Zatra does not decide or guarantee any authority's outcome. Mainland law is described. Zanzibar has its own laws on auctions and sales, which a Zanzibar advocate should confirm. See also the deal rounds page and the auction room.
Related pages on Fursa365 include how Fursa365 works and regulatory boundaries.
Sources and status
Accurate as at 6 Nov 2026. Figures are from the sources below and from the Zatra government fees register, quoted with their register IDs so they can be checked line by line.
- Sale of Goods Act, Cap. 214, section 59. TanzLII, version of 31 July 2002, consolidated to 2019. Accessed 6 Nov 2026.
- Auctioneers Act, Cap. 227. TanzLII, version of 31 July 2002, consolidated to 2019. Accessed 6 Nov 2026.
- Law of Contract Act, Cap. 345. TanzLII, version of 30 November 2019. Accessed 6 Nov 2026.
- Court Brokers and Process Servers (Amendment) Rules, 2019, GN 106. Laws.Africa Commons, gazette copy of 1 February 2019. Accessed 6 Nov 2026.
- Thumbsup Company Limited v Board of Trustees of Ifakara Health Institute. High Court of Tanzania, 14 June 2024. Accessed 6 Nov 2026.
- Anti-Money Laundering Act, Cap. 423 R.E. 2019. Ministry of Finance, Revised Edition 2019. Accessed 6 Nov 2026.
- AML/CFT Compliance Guide on Obligations of DNFBPs. Financial Intelligence Unit Tanzania, January 2023. Accessed 6 Nov 2026.
- Public Procurement Act, 2023. Public Procurement Regulatory Authority, uploaded January 2025. Accessed 6 Nov 2026.
- Land Act, Cap. 113, table of contents. TanzLII, consolidated to 30 November 2019. Accessed 6 Nov 2026.
- Tanzania tax update: Finance Act 2026 highlights. Clyde and Co, 3 July 2026. Accessed 6 Nov 2026.
- Zatra Tanzania Government Fees Register 2026, business licence and tax chapters. Zatra Consultants Limited, 2026 edition. Accessed 6 Nov 2026.
Figures to confirm before you act
- Auctioneer licence TZS 150,000 a year or TZS 75,000 for a half year (register ID NEW-08-17) and council licence TZS 150,000 (register ID BLB243)
- Subsection lettering of section 59 of the Sale of Goods Act and section numbers of the Auctioneers Act are as returned by a summary tool; check before a pinpoint citation
- Whether a closed sealed round is competitive bidding under section 3 of the Auctioneers Act: untested, no authority found
- No Tanzanian authority found that an invitor may refuse the highest bid; the High Court case supports only that a tender invitation is an invitation to treat
- Anti-Money Laundering Act paragraph and section numbers may have changed in the 2022 revision
- Land Act mortgagee sale sections: body text not read; VAT and stamp duty rules specific to auctioned goods: not found
General information prepared by the Fursa365 deal desk, Zatra Consultants Limited. It is not legal, tax or investment advice and does not decide or guarantee any authority's outcome. Confirm current rules and fees with the authority named and your own advocate before you act. Mainland Tanzania is described; Zanzibar has separate laws and bodies.
Questions readers ask
Do I need a licence to sell my own asset by sealed bids?
The Auctioneers Act exempts a person selling their own property, as read. If a third party runs competitive bidding for you, the licence rules apply. Whether a closed sealed round counts is untested, so take advice on the structure.
Can I refuse the highest sealed bid?
In a deal round, yes, if the terms say expressions are not offers and the owner may choose any counterparty. A court case supports that a tender invitation is an invitation to treat. No authority was found on refusing the highest bid.
Can a bidder withdraw a bid?
In an auction under section 59 of the Sale of Goods Act a bidder may retract until the hammer falls. In a sealed round the Law of Contract Act lets a proposal be revoked before acceptance is complete, so assume withdrawal is possible.
Can I bid on my own lot?
Only if the sale was notified with a reserved right to bid. Without that notice, seller bidding is not allowed and the buyer may treat the sale as fraudulent. Say it in the sale particulars before the auction.
Who holds the deposit?
In the Fursa365 auction room the auctioneer registers bidders and holds any deposit under its terms. In a deal round nobody holds money for the platform. Fursa365 never holds deposits or sale money.
Are shares or mining licences auctioned?
Not on Fursa365. Its auction room sells vehicles, machines, goods, livestock and property only. A stake or a licence interest goes through a deal round or private tender, and may need regulator consent.
Is a private tender regulated like a public tender?
No. A public asset disposal follows the Public Procurement Act with tender board approval. A private tender is governed by contract law, the Sale of Goods Act where it applies and the parties' written terms.
Does this apply in Zanzibar?
This guide describes Mainland law. Zanzibar has its own sale, auction and tax rules, so a Zanzibar owner should confirm the route and any licence with a Zanzibar advocate before listing.
Tanzania market entry, corporate governance and regulated-sector route decisions. Certified Financial Educator with more than twelve years in the financial sector.
