1. Background
Law 8/2023, of 9 June ("Investment Law"), which repeals Law 3/93, of 24 June, was recently approved.
According to its preamble, this new legal diploma, on the one hand, responds to the need to promote the continuous improvement of the investment and business environment in the country, considering the profound changes that have occurred since Law number 3/93, of 24 June, and its adaptation to the current context and dynamics of the national economy, regional and global. On the other hand, its approval is part of the Economic Acceleration Measures Package (PMAE), promoted by the Government, which amongst other measures, in its article 14, provides for the adjustment of the Investment Law, in order to make the country more attractive to foreign investment.
2. New Investment Law
In addition to the above-mentioned reasons that dictated the revision of the Investment Law, it is important to highlight the main novelties of the new law, namely:
a) Increase in the protection of the right to property, manifested through the prohibition of expropriation, nationalization and requisition of investors' rights or adoption of equivalent measures, except in the following cases: (i) if such measures are based on the necessity, utility or purposes of relevant public interest; (ii) are adopted on a non-discriminatory basis; (iii) give the investor the right to fair compensation and (iv) comply with the applicable legal rules.
b) Establishment of special duties of investors, with emphasis on the following: (i) payment of taxes, fees and other contributions due; (ii) respect for and compliance with current regulations concerning the environment, nature protection and waste management; (iii) respect and compliance with labor, accounting, exchange and registration standards; (iv) contracting, underwriting and maintenance of compulsory insurance; and (v) contribution to the development of social responsibility policies in the area of investment implementation and respect for local customs.
c) The national direct investment now includes in its catalog, namely: (i) the assignment of the right to use and benefit from the land; (ii) incorporation of technologies and knowledge capable of being valued in monetary terms; and (iii) investment of capital in national territory within the scope of reinvestment.
d) Foreign direct investment now covers, inter alia: (i) the incorporation of technologies and knowledge capable of monetary valuation; (ii) the provision of specialized services from abroad for the benefit of economic projects in the country; (iii) the application of capital in national territory within the scope of the reinvestment; and (iv) the conversion of the value of the Mozambican external debt, related to loans and financing registered with the competent authority.
e) Establishment of the possibility of establishing in the national territory industrial parks, special economic zones, industrial free zones and areas of rapid development, in which special regimes apply, in particular in fiscal, customs, labour or exchange matters.
f) Establishment of the promotion by the State of optional and progressive measures of means of providing public services by electronic means, through the practice of certain acts by electronic mail or through specific platforms created for this purpose.
g) Administrative procedures related to private investment projects are now subject to the general principles of public administration.
h) Regarding the export of profits resulting from investment and reinvestments, these are now governed by foreign exchange legislation.
The new Investment Law does not introduce any change in the values of investments, in the competent entities for their approval and in the respective deadlines, and the development of these aspects is reserved to the regulation that will be made by the Government. Thus, the following legal framework remains in force:
a. The minimum amount of foreign direct investment, resulting from the contribution of equity of foreign investors, is set at the equivalent of 7 500 000.00MT (seven million five hundred thousand meticais), for the specific purpose of transferring profits abroad and re-exportable invested capital.
b. The decision on the investment projects submitted to APIEX, IP is responsible for:
i. to the Secretary of State in the Province, within a maximum period of 3 (three) working days, after receipt of each proposal, regarding the realization of national direct investment projects of a value not exceeding the equivalent of 4 500 000 000,00MT (four thousand five hundred million meticais);
ii. to the Director-General of APIEX, IP, within a maximum period of 3 (three) working days, after receipt of each proposal, regarding the realization of national and/or foreign investment projects of a value not exceeding the equivalent of 7 500 000 000.00MT (seven thousand five hundred million meticais) and projects in Special Economic Zone and Industrial Free Zone regime;
iii. to the Minister who supervises the area of Finance, within a maximum period of 3 (three) working days after the receipt of each proposal, regarding the realization of national and/or foreign investment projects, provided that the amount does not exceed the equivalent of 37 500 000 000.00MT (thirty-seven thousand five hundred million meticais);
iv. to the Council of Ministers, within a maximum period of thirty (30) working days, after receipt of each proposal, regarding the realization of:
i) Investment projects whose value exceeds the equivalent of 37 500 000 000,00MT (thirty-seven thousand five hundred million meticais);
ii) Any other projects with foreseeable political, social, economic, financial or environmental implications, the consideration and decision-making of which should be the responsibility of the Council of Ministers, on a proposal from the Minister who supervises the area of Finance.
3. Implementation
This Law shall be implemented ninety (90) days after the date of its publication. In addition, it is up to the Council of Ministers to approve its regulations within 120 days of its publication.
It should be noted that to the investment projects under consideration on the date of implementation of the new Investment Law, Law No. 3/93 of 24 June and the respective regulations are applicable.