The Reform Design Phase began in January, 2006 to May, 2008. The Reform Design was based on the need to build a property and business regime that relates to the existing laws and key identified archetypes. The phase generally aimed at providing the government with detailed policy, legal and institutional reform proposals, as well as an implementation strategy that will be used to integrate extralegal real estate and businesses into the legal system in order to boost economic growth, reduce poverty and eventually expand the tax base.

• To address the weaknesses revealed in the diagnostic report the Reform Design process was divided into five steps. These included: Field validation of the archetypes discovered during the Diagnostic Study;
• Convergence analysis to create a new framework that simplifies the legal and institutional framework and accommodates existing archetypes;
• Lessons from ongoing reforms and interventions;
• Lessons from pilot projects; and
• Linkages to national policies and strategies.

The key activities for the Reform Design Phase included,

• Re-engineering the current legal system for property and business, on the basis of the findings from the diagnosis.
• Preparing proposals for the creation of an entity directly responsible for the formalization processes (a legally constituted organ mandated for realization of the objectives of the formalization program and oversight on the activities related to formalization
• Preparing the implementation plan comprising of the strategies, schedule of activities, time frame and budget.
• Proposing and obtaining consensus on the funding of the implementation phase.
• Developing and testing a Development Communication Strategy sufficiently linked to national generic and sectoral reform programs.

Key Outputs for Property and Business Reforms:
The key outputs for the Reform Design Phase included a series of reforms outlines and proposals whose adoption and implementation is expected to provide assets owners with legal recognition and protection of their assets and the means to use them for economic benefits in the formal market. Other outputs from the second phase included a Communication Strategy and its work plan; a Cost Benefit Analysis Framework that helps to justify investing in implementation of the reforms; and a Monitoring and Evaluation Framework.

Reform Outlines
There are five key reform outlines designed to create an appropriate policy, legal and institutional framework for implementing the proposed Business and Property Formalization Program. These include,

• Reforms that will facilitate fast track and cost effective formalization of real estates in Tanzania Mainland and Zanzibar.
• Reforms to facilitate fast track and cost effective economic use of real estate assets
• Reforms to facilitate formalization of businesses in Tanzania Mainland and Zanzibar.
• Reforms to facilitate business growth and economic use of business assets.
• Reforms to address cross-cutting issues such as personal identification, administrative simplification and creation of specialized institution responsible for formalization of businesses and real estate assets.