04 May 21 |
Private Investment Law

Law no. 10/21, of 22 April modifies Law no. 10/18, of 26 June - Private Investment Law

Law no. 10/18, of 26 June - Private Investment Law ("LIP") arose from the need to encourage, mainly foreigners, to invest in Angola in a regulated manner and thus ensure legal security and stability regarding the process and the investment itself.

 The LIP is the norm that is in force and establishes the benefits and facilities that the State grants to investors, however, due to the economic and social changes that the world has been experiencing, the laws have to keep up to adapt to the needs that are imposed. Therefore, Law no. 10/21 of 22 April, amending articles 2, 3, 8, 10, 20, 27, 31, 34, 38, 40 and 49 of Law no. 10/18 of 26 June - Private Investment, arose from the need to improve the conditions of competitiveness in attracting investment.

 The norm that amends the LIP added in its scope that the investments regulated by special law must be registered with the Angolan Private Investment and Export Promotion Agency ("AIPEX"), for the purposes of statistical control and attribution of Private Investor Status.

 Regarding the realisation of the investment project, the definition of "domestic investment" was broadened, which can be made through the use of means of payments available in Angolan territory by foreign exchange residents, and "foreign investment" can be made with the introduction or use in the national territory of freely convertible currency held by non-foreign exchange residents.

 The form of investment, internal and external, the term "funds" is replaced by "capital" both for allocation, transfer and reinvestment; raw materials (where applicable) are included as a form of investment, but the incorporation of technologies and knowledge are no longer considered as a form of investment.

 Another change in the LIP is that the foreign investor now has the possibility of transferring abroad his dividends, etc. after payment of the taxes due and the constitution of the compulsory reserves, excluding from its concept the obligation of complete and duly proven execution of the private investment project.

 The value of investment and jobs are also now considered as impact factors, along with priority sectors of activity and development zones.

 Investors can start implementing their private investment projects as soon as they obtain the Private Investment Registration Certificate ("PIRC"), without having to wait for provisional licenses and other authorizations from public administration bodies.

 Another significant change is that recourse to credit is possible at any time, regardless of the stage the project is at, both for the internal and external investor.

 A third option to the investment regime arises, which is the Contractual Regime - applicable to projects carried out in any sector of activity but which implies negotiation between the promoter of the investment project and the Angolan State, since the Prior Declaration Regime and the Special Regime already exist (the choice of regime is the free will of the investors), and the tax benefits are now provided for in the Code of Tax Benefits and not in the LIP.

 Companies carrying out activities whose investments have not been made under the LIP may carry them out by registering the said projects with AIPEX, but without benefiting from the tax incentives provided by law.

 The new law came into force on 22 April 2021.


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