Approval of the New Regulations on Special Economic Zones and Industrial Free Zones in Mozambique

The Council of Ministers has approved Decree No. 12/2026 of 13 April, which establishes the new Regulations on Special Economic Zones (“SEZs”) and Industrial Free Zones (“IFZs”), repealing the previous Decree No. 75/99 of 12 October.

The new Regulations aim to modernise the legal framework applicable to SEZs and IFZs, bringing it into line with the Private Investment Law (Law No. 8/2023 of 9 June) and strengthening the role of these schemes in industrialisation, economic diversification and the promotion of private investment in Mozambique.

1. Main Objectives of the Regulation

SEZs and IFZs will assume a strategic role in national economic development, with a focus on:

a) promoting economic growth;

b) industrialisation and increased competitiveness;

c) creation of qualified employment;

d) the development of value chains;

e) promoting exports;

f) incorporation of local raw materials and increasing national added value; and

g) attraction of private investment.

2. Eligible Activities

2.1. SEZs

In SEZs, all economic activities permitted by law may, as a rule, be authorised, except for:

• prospecting, exploration and production of oil, gas and mineral resources (except industrial processing);

• activities related to the manufacture or processing of weapons, ammunition, explosives and similar items.

2.2. IFZ

IFZs are primarily intended for industrial activities, with a requirement that at least 70% of annual production be destined for export.

3. Introduction of the Isolated Industrial Free Zone

One of the key innovations of the Regulation is the introduction of the “Isolated Industrial Free Zone” status, applicable to strategic projects located outside existing IFZs. To benefit from this status, the project must cumulatively meet the following requirements:

a) a minimum investment equivalent to 3,250,000,000.00 MT;

b) creation of at least 150 direct jobs for nationals; and

c) potential for the creation of value chains and industrial clusters.

3.1. Priority sectors

a) agri-industry;

b) textile industry;

c) pharmaceuticals;

d) metallurgy;

e) automotive assembly;

f) electronic equipment; and

g) biotechnology.

4. Establishment and Approval Process

The creation of SEZs and IFZs remains subject to approval by the Council of Ministers, upon a proposal from the Minister responsible for the Economy. The Regulation sets out detailed requirements for the submission of proposals, including:

a) an economic and financial feasibility study;

b) business plan;

c) development and operationalisation plan;

d) environmental and social impact assessment;

e) a plan for the recruitment and training of local staff; and

f) commitment to implement at least 10 projects in the first 5 years.

5. Labour Regime

The Regulation confirms the applicability of Mozambican labour legislation to companies in the SEZs and IFZs, introducing specific rules for the recruitment of foreign workers. In particular:

a) the number of foreign workers may reach up to 15% of the total number of national workers;

b) hiring above the quota is subject to the general regime;

c) operators must promote knowledge transfer and the training of nationals.

6. Tax and Customs Regime

The Regulation reaffirms the existence of tax and customs incentives applicable to eligible projects, referring to specific legislation for details. Key aspects include:

a) suspension of customs duties on imports of equipment and supplies intended for activities in SEZs and IFZs;

b) differential customs treatment for goods intended for export;

c) the possibility of selling to the domestic market:

   i. with no express limitation for SEZ companies; and

  ii. up to 30% of annual production for IFZ companies, subject to payment of the applicable taxes.

7. Supervision and Inspection

The Regulation strengthens the mechanisms for supervising and monitoring operators and companies established in SEZs and IFZs, assigning powers to the entity responsible for coordinating private investment, without prejudice to the powers of the Tax Authority, the Bank of Mozambique and other sectoral entities.

8. Penalty Regime

Penalties are provided for non-compliance relating to:

a) misuse of incentives;

b) false declarations;

c) failure to comply with the terms of the approved investment;

d) customs and foreign exchange irregularities; and

e) breach of labour and environmental obligations.

Penalties may include:

a) a warning;

b) loss of tax incentives;

c) revocation of authorisation; and

d) fines of up to 1% of the value of the approved investment.

9. Transitional Regime – Amendment to the Regime

The Regulation also provides for a transitional mechanism applicable to projects already approved prior to its entry into force. Under Article 59, previously approved investment projects whose activities are eligible for the SEZ and IFZ schemes may apply to transition from the general scheme to the new scheme; to this end, the application must:

a) be expressly justified;

b) be addressed to the entity responsible for coordinating the private investment authorisation process; and

c) be submitted within a maximum of 180 days from the entry into force of the Regulation.

Newsletter JLA Decree No. 12-2026, of 13 April.pdf

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