1. Contextualization
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Law number 28/2022, of 29 December ("Foreign Exchange Law"), which revises and revokes Law number 11/2009, of 11 March, was recently approved.

According to its preamble, this new law aims to modernize the foreign exchange market, making it safer and more efficient, as well as to harmonize it with the objectives set out by the SADC regional block until 2028.

At the same time, it is expected that the entry into force of this new instrument will give rise to greater "meticalisation" of the national economy, as a result of the mandatory payment obligation in national currency of all domestic transactions in the country and a harmonization of the multiple special exchange rate regimes in force, particularly those applicable to mining and hydrocarbon exploration projects.

 

2. New Foreign Exchange Law

 

Along with the reasons that dictated the revision of the Foreign Exchange Law mentioned above, it is important to point out some of the main novelties of the new law, namely:
 

1. The application of the Foreign Exchange Law to the State and other legal persons governed by Public Law, which carry out foreign exchange transactions concerning goods or valuables located in foreign territory and rights over such goods or valuables or activities carried out in the respective territory.

2. Inclusion as resident entities, and therefore applicable to the foreign exchange law, of national natural persons with habitual residence in Mozambique, who carry out non-occasional activity in foreign territory, namely frontier or seasonal workers and crews of ships, aircraft or other mobile equipment operating totally or partially abroad.

3. Prohibition of payment and receipt in foreign currency within the national territory between exchange residents.

4. Inclusion to the specific foreign exchange regulations, the contracts signed with the Government of the Republic of Mozambique, which contain a special foreign exchange regime.

5. Prohibition of the gathering of accounts or compensation in the receipt from abroad and in the repatriation of revenues.

6. Criminal liability, to those who carry out exchange trade or partial exchange trade, without legal authorization, with a penalty of 2 (two) to 8 (eight) years of imprisonment and a corresponding fine.

7. Increase in the number of contraventions from the previous 11 (eleven), to the current 31 (thirty-one), and the respective classification into exchange contraventions and serious exchange contraventions.

8. Increased fines as a result of the practice of exchange contraventions, graduated with reference to the minimum salary of the banking sector, namely:
    

   • a fine ranging from 10 (ten) to 50 (fifty) minimum salaries, for the committing of currency exchange contraventions, when committed by individuals;

   • a fine ranging from 50 (fifty) to 500 (five hundred) minimum salaries, for the committing of serious foreign exchange contraventions, when committed by individuals;

   • a fine ranging from twenty (20) to one thousand (1000) minimum salaries, for the committing of currency exchange contraventions, when committed by legal persons;

   • a fine ranging from one hundred (100) to one thousand and five hundred (1,500) minimum wages, for the committing of serious currency exchange contraventions, when committed by legal persons;

   • a fine ranging from 50 (fifty) to 1500 (one thousand and five hundred) minimum salaries, for the committing of currency exchange contraventions, when committed by credit institutions and financial corporations;

   • a fine ranging from one hundred and fifty (150) to two thousand and five hundred (2500) minimum salaries, for the committing of serious currency exchange contraventions, when committed by credit institutions and financial companies.

 

3. Entry Into Force

 

This Law enters into force 30 (thirty) days after the date of its publication. However, it is important to point out that all natural and legal entities covered by it have a period of 90 (ninety) days from its entry into force to adapt.