The Mozambican Investment Law Regulation has been amended by Decree no. 20/2021, entering into force on April 13. In general, the procedure has been simplified and We highlight the following amendments:
• For purposes of transfer of profits and invested capital to other countries, the minimum amount of direct foreign investment resulting from equity capital is of MT 7,500,000.00.
• The value of annual exports considered for the suitability of transferring profits and invested capital to foreign territory is of MT 4,500,000.00.
• Investment project proposals must be sent to the Mozambican Agency for the Promotion of Investment and Exports (“APIEX”) in four copies, drafted in the official application form, and accompanied of the documents needed for the analysis.
• Depending on each case, the investment project proposals shall be accompanied of documents as lease contracts, property titles or professional internship and Mozambican workforce employment plans (for local content purposes).
• Decisions from the Provincial Secretary of State, APIEX General Director, and Finance Minister, shall be performed until three workdays after the reception of the proposal.
• APIEX shall inform the investors of the decision, until 48 hours after it.
• The decision regarding investment projects may be performed by the Provincial Secretary of State (direct Mozambican investment up to MZN 4,500,000,000.00), by the APIEX General Director (Mozambican or foreign investments up to MZN 7,500,000,000.00 and projects for Economic Special Zones or Industrial Free Zones), by the Finance Minister (Mozambican or foreign investments up to MZN 37,500,000,000.00) or by the Ministers Council (investments of more than MZN 37,500,000,000.00 or projects with foreseeable social, political, economic or environmental implications whose decision shall be made by this entity).
• Investors may assign totally or partially their rights regarding an investment, through duly based request to the entity which approved the project. The request shall be accompanied of tax compliance proofs.
• Companies with headquarter in Economic Special Zones need to request authorization to hire foreign employees and shall register them with the entity which supervises the Employment sector.
• The approved investors have access to a permanent residence authorization, which may be extended to their partner and children up to 21 years old.
• Transfers to foreign territory of profits and dividends are permitted since the exchange legislation and the payment of taxes are complied.
• The certification of companies operating in Economic Special Zones is made through the issuance of the competent certificate by APIEX, on ten workdays after the reception of the request.
• Inspections to companies with headquarters in Economic Special Zones need a previous authorization by APIEX and shall be informed to those companies by this entity until five workdays after receiving the inspection request, except when the inspecting authority is the Tax Authority or the Economic Activities National Inspection.
• Industrial Free Zones are created by decision of the Ministers Council, after proposal of the Finance Minister.
• APIEX shall analyze the proposal and elaborate an opinion to be analyzed by the Ministers Council.
• Investors have six months after the authorization date to establish their enterprise in the Industrial Free Zone.
• The percentage of authorized sales to the local market from companies established in Industrial Free Zones may be modified by the Finance Minister, after founded request by the investors and positive opinion from APIEX and Tax Authority.
• Claims related with investment matters regulated by the Investment Law and Regulation need to be sent to APIEX, which distributes them by the defendant authorities.
• If the defendant authorities do not answer APIEX nor execute any measure to solve the claim, APIEX shall propose a solution to the Finance Minister, which will decide the question.
This amendment’s purpose is to adapt the Regulation to the new institutional framework and the investment-friendly policy which is being followed by Mozambique, encouraging internal and foreign investment in a country that has shown in the last years that has an enormous investment potential.
Article by Duarte Marques da Cruz
Duarte Marques da Cruz
Duarte Marques da Cruz is partner of the Portuguese law firm MC&A, specialised in international business advisory, with a special focus in Lusophone markets. With extensive experience in the Energy sector (Renewables and Oil & Gas) and in International Taxation, he has supported international companies in major upstream, midstream transactions and projects, including in implementing, exploration and development programs. Duarte has also supported international clients in other areas of practice, namely, Mining, Transport & Logistics, Regulatory Compliance and Mergers & Acquisitions in Mozambique, Angola and Portugal.