Leasehold can be defined as holding land for a known time frame based on conditions in an agreement between the registered owner and the tenant. Leasehold tenure involves a landowner giving another person, called a tenant/ lessee, the right to possess or control the land in exchange for payment.
The owner of the land grants another person undisturbed (exclusive) use of the land, usually for a specific period of time. Land may also be leased from the state to individuals for typical lease periods of 5, 45, or 99 years. In return, the tenant usually pays an annual rent or service under specified terms and conditions. Leaseholders may or may not hold formal contracts with the owner although it is highly recommended that formal agreements are signed.
Leasehold tenure is mostly evident on public land of which they are granted by the District Land Boards (DLB) and Uganda Land Commission (ULC) on behalf of Government. It can also be granted on customary, mailo and freehold. Leases granted on public land are called public leases while those granted on private land by private persons are known as private leases. A lease granted for 3 or more years is entitled to a certificate of title. Non-citizens of Uganda can acquire leases on land for a period not exceeding 99 years. Non-citizens must register a lease if it exceeds a period of five years.
Private leases can be converted to freehold with the consent of the land owners. Any lease (public lease) that was granted to a Ugandan citizen out of former public lands might be converted into a freehold.
A person can also acquire a lease on public land from the District Land Board. Such leases are usually granted for a duration of 49 years.
A registered lease is proved by possession of a Certificate of Title and an unregistered lease can be proved by a lease agreement between the lessor and the lessee.
Note: Non-Ugandans, whether individuals or companies, can only own land under leasehold tenure in Uganda.
Features of Leasehold Land Tenure System:
- The lessor transfers exclusive possession to the lessee.
- Transfer is made upon payment of an agreed rent called premium.
- A lease is given for a specified period, the start and end of which is clearly stated in the lease agreement.
- It is the only form of land holding allowed to foreigners in Uganda.
- A non-citizen cannot be granted a lease of more than 99 years.
- It is common in urban areas such as towns, municipalities and the city where public land is held and managed by institutions like Uganda Land Commission (ULC) and the District Land Board (DLB).