Any company that carries out an activity in the Congolese Republic is subject to Decree No. 2004-30 of February 18, 2004, establishing the terms of approval of companies for the benefits of the Investment Charter. The latter establishes, in its Article 5, the criteria to be met in order to benefit from the advantages of the Investment Charter. This decree also provides for preferential regimes for eligible companies, particularly during the installation and operating periods.
Any application for approval to one of the privileged regimes or incentive measures of the Investment Charter must be filed with the competent department at least one month before the session of the committee that decides. The file is filed under the conditions provided for by the Decree.
I. THE ADVANTAGES OF THE INVESTMENT CHARTER
The advantages consist, on the one hand, of tax and customs advantages such as:
the implementation of a reduced rate on value added tax and customs duties for imports related to the investment program, total exemptions on corporate profits or personal income, the implementation of declining or accelerated depreciation, etc.
The benefits consist, on the other hand, of export incentives, incentives for the reinvestment of profits, incentives for setting up in landlocked areas. According to the assumptions, this will allow to benefit from:
A VAT rate equal to zero on exported productions;
A 50% reduction in corporate income tax and personal income tax over the three years;
A 50% reduction in corporate income tax or personal income tax.
II. THE PROSPECTS OF THE INVESTMENT CHARTER
After a dozen years of application of the current decree on the Investment Charter, a new draft decree is proposed by the Ministry of Economy, Industry and Public Portfolio to the government. The rereading of the implementing decree of the Investment Charter is today motivated by certain weaknesses including the absence of a rigorous distinction between the installation period and the operating period.
Thus, the draft decree proposes to distinguish precisely the installation/extension period from the operating period by:
Administratively noting the period of installation and extension;
Determining the specific benefits for each period.
Furthermore, while the decree in force provided for the G and S regimes and incentive measures, the draft decree is based on a more factual approach, based on the size of the companies and the area in which their activities are deployed. This results in the need to broaden the scope of the incentive regimes. Two new regimes (I and P) are planned. The L regime will be that of companies operating in landlocked areas. The P regime will be reserved for preferential development zones.
For each regime, in addition to the privileges of the general regime G, specific tax and customs advantages will be granted depending on the size of the company, any isolation or preferential nature of its location.
Finally, the draft decree provides for an appropriate legal regime applying to requests for amendments, thus filling the legal void that exists in this area.
Faced with these developments, Lexa International offers to be your advisor to benefit from the advantages of the investment charter in an optimal manner.
For more information, please contact us at: www.lexa-inter.com
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