Commercial Law In Mozambique

GENERAL INFORMATION

The Republic of Mozambique is located on the south-east coast of Africa, bordered in the north by Tanzania; on the west by Malawi, Zambia and Zimbabwe; on the south-west and south by South Africa and Swaziland; and on the east by the Indian Ocean.

Area: 799 380km2

Population: 22.0 million

Capital: Maputo

Currency: Meticais

GDP: USD 22.19 billion (2010)

Internet domain: .m

zLanguages: Portuguese (official language)

Working week: Monday - Friday

Exports: Aluminium; prawns; cashew nuts; cotton; sugar; citrus; timber; bulk electricity

Imports: Machinery and equipment; vehicles, fuel, chemicals, metal products; foodstuffs; textiles

COMPANY LAW

Business vehicles

There are two main types of companies commonly used by foreign investors:

Sociedade por Quotas (equity is referred to as quota). Sociedade Anónima de Responsabilidade Limitada which is loosely equivalent to a joint stock company. Incorporation

The following steps need to be taken in order to incorporate a company:

An application to reserve a name is required which must be approved by the Mozambican Legal Entities Registry Office. A company name can be reserved for a period of 90 days (which is renewable for a further period of 90 days upon request and payment of the relevant fee). The registration process has 3 stages: Signature of the articles of association of the company by means of executing either a public deed signed before a Notary or a private document with notarization of the signatures. Publication of the articles of association in the Official Gazette (Boletim da República). Registration of the articles of association with the Registrar of Companies. Resolutions approving the incorporation of the company passed by shareholders that are legal entities must be submitted together with the articles of association. A license for the specific activity of the company may also be required. The application for the license must be filed together with a plan and detailed description of the property where the company will carry out business, as well as the relevant lease agreement. Sectors such as mining, oil and gas, civil construction, healthcare and laboratories, educational, media and telecommunications and banking and insurance have more complex licensing processes due to specific requirements such as financial capacity, minimum technical staff and minimum share capital. The time frame for the incorporation of an entity is between 30 and 45 days.

Regulatory reporting

An annual tax return reflecting the balance of tax due must be submitted by 31 May each year, with supporting documents filed by the end of June.

Share capital

There are no minimum share capital requirements.

Quota Companies: the quota holders of a quota company may set the capital at a level that is sufficient for the company to carry on its activity. The capital must correspond to the sum of the nominal values of each of the quotas...