The recent increase in transnational acquisitions of agrarian land raises concerns about rural people's inadequate involvement in the decision-making process, and violations of their land rights. Tanzania's statutory land laws are comparatively progressive in terms of recognising customary land rights. According to legislation, transferring ‘Village Land’ to an investor requires villagers' approval. It is therefore revealing to focus on the acknowledgement of customary rights in land deals in Tanzania. This study analyses the land transfer process of a UK-based forestry company that has acquired land in seven villages in Kilolo District. In the case of the village presented here, the investor seems to have followed legal procedure regarding decision-making for the land deal in a formally correct way. Yet, interviews with various stakeholders revealed flaws at village and district government level that have led to a conflict-ridden situation, with numerous affected villagers having lost their land rights – and thus the basis for their livelihoods – against their will. Among those affected are several households from a neighbouring village, whose customary rights date back to the period before the resettlements of the 1970s (‘villagisation’). Employing the concepts of property rights and legal pluralism and unbundling the role of different actors in the host country government, this article analyses the decision-making process that preceded this land transfer. It illustrates how unequal power relations lead to unequal recognition of customary and statutory law. The study concludes that even under comparatively favourable legal conditions, there is no guarantee that local land rights are fully protected in the global land rush.