Recent amendments to Angolan law aim to attract and facilitate much needed domestic and foreign investment.
Angola is an economy essentially based in the oil sector, and the Government has understood that for sustainable domestic growth, they have to diversify investments into areas such as agriculture, infrastructure and tourism, says João Robles, Head of the Angola practice at F. Castelo Branco & Associados in Lisbon.
While Angola’s high international investment continues, domestically, it’s a different story. The Government has therefore introduced significant changes to the country’s legal system to better facilitate the entry of foreign investors.
Angola’s tax legislation has been amended to make its tax system more effective and provide investors with a level of security, says Robles. “Previous laws were in force for over 30 years and they desperately needed modernising.”
There have also been changes to the foreign exchange legislation, namely the Regulation Applicable to Services Agreements. “Most partnerships in Angola are based on service agreements, so this has wide ranging implications.”
As the previous system was very informal, Robles adds, this, together with the recent new law applicable to private investments, represents a major achievement for the Angolan economy, very simply because it gives security to investors that was lacking.
“They are now assured that their investments will be protected as long as they are willing to honestly invest in the country and in the areas considered as priorities by the Angolan Government,” he explains.
In June 2012, the Sole Shareholding Regulation was approved,whereby a company can have only one shareholder. “This is significant because an investor can now come into Angola alone.”
There is clearly now a will on the part of the Government to attract foreign investment in a much more structured and consistent way, he says. Whether this will have the desired effect, however, remains to be seen.