Almost 30 years after the approval of the Investment Law, Law 3/93, of 24 June, the new Private Investment Law, Law 8/2023, of 9 June, is now approved, promulgated, and published.

This new law aims to adapt the legal framework of national and foreign investment in Mozambique to the current dynamics of the economy at local, regional, and international level, aiming to boost the improvement of the business environment. This review was already foreseen under the Action Plan for the Improvement of the Business Environment 2019-2021 (PAMAN), approved by the Resolution of the Council of Ministers 27/2019, of 14 May, and reinforced in the Package of Economic Acceleration Measures (PAE) announced by the Government of Mozambique in August 2022 (https://pae.gov.mz/).

The Private Investment Law now published brings some profound changes in the process of recognition and registration of private investments eligible to enjoy tax and non-tax benefits, and refers the generality of the procedural regulation to regulation and other specific legislation (exchange regulations and tax legislation in particular).

The following matters of this Private Investment Law must be highlighted:

1. It applies to all private investments, of national and/or foreign capital, that intend to enjoy tax and other benefits and guarantees, and also applies to public-private partnership projects, large-scale projects and business concessions, with the exception of projects in the areas of exploration of mineral resources, public investment projects and social projects;
2. Freedom to invest in all economic areas, within the legal limits, except activities reserved to the exclusive ownership or exploration by State, as well as investments in sectors or activities with restrictions due to nationality, in accordance with the provisions of specific legislation;
3. There are now two investment regimes:

a)    Prior approval regime, applicable to (i) large scale projects or with foreseeable economic, environmental, safety or public health implications, (ii) public-private partnerships and business concessions, (iii) projects that require an area of land equal to or greater than 10,000 ha, (iv) projects that require a forest concession of an area equal to or greater than 100,000 ha,  and (v) projects for the industrial processing of mining and/or petroleum products; and

b)    Regime of mere registration, applicable to all other projects, which consists of the mere presentation of the investment proposal for the purpose of registration and allocation of the applicable incentives;

4. The resolution of conflicts shall preferably be settled amicably or by negotiation, and if an amicable resolution is not possible, it can be resolved through extrajudicial means of dispute resolution, at national or international level, namely, mediation, conciliation and arbitration, provided that by special law or agreement such conflicts don’t require to be submitted to the exclusive jurisdiction of a national court, specific arbitration rules or other specific means of dispute resolution.

This law enters into force 90 days after its publication, and Government shall approve its regulation within 120 days. Temporarily, the existing regulations apply, mutatis mutandis, and Law 3/93 continues to apply to investment projects under analysis by the relevant authorities.