On the end of April, entered into force Law no. 10/21 of April 22, which modified Law no. 10/18 of June 26 (Angolan Investment Law).
With this amendment, the Angolan State intends to improve its competitiveness regarding the implementation of domestic and foreign investment, fortifying its position as one of the most desirable African countries to implement an investment, namely with the creation of a contractual investment regime, which permits the negotiation of great part of the aspects connected with the investment.
The following are the most relevant modifications:
- It is established the obligation to register investment projects regulated by special law at AIPEX, for the granting of Private Investor status.
- Domestic investment begins to comprise the allocation of capital (even if in case of reinvestment), machinery, and equipment.
- Foreign investment starts to englobe the transference of capitals from foreign territory and transfer of machinery, equipment, and other instruments.
- Investors may now transfer capitals (profits, dividends) to foreign territory without the total execution of the private investment project, but only if they pay their taxes and constitute legal reserves.
- Foreign investors are now able to use domestic credit mechanisms without having totally implemented their investment project.
- It was introduced the private investment contractual regime, which permits a direct negotiation with the Angolan State regarding conditions, incentives and benefits that will be granted for the settlement of the investment.
- The elements which are evaluated for the granting of benefits to the investment project start to include the value of the investment and the number of jobs generated.
- Tax benefits applicable to the special investment regime were revoked and that matter will be regulated by the Tax Benefits Code, which is not in force yet.
- The grant of benefits has no longer a limitation period of ten years.
- Companies whose investment was not performed under the Private Investment Law may, from this moment, register their investment at AIPEX, permitting the transfer of funds to foreign territory with the same easiness than the companies whose investment was registered before its execution.
With the mentioned modifications, it is expected that more major investments are closer of becoming a reality in Angola, namely structural investments with huge economical and social impact. The Angolan State shows through this amendment, a strong effort to maintain its Investment framework updated and enhance it, attracting more and better investment to one of the African countries with greater potential.
Article by Duarte Marques da Cruz
Duarte Marques da Cruz is partner of the Portuguese law firm MC&A, specialized 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