Angola and the Democratic Republic of Congo (DRC) have signed a cooperation agreement for the joint exploitation and production of hydrocarbons in the area situated on the maritime border of the two countries. The agreement was formalized last week (July 13) in Kinshasa between the Petroleum Ministers of Angola and the DRC.

The area, designated as “Common Interest Zone”, lies between the north section of Angola’s Blocks 1, 15 and 31 and the south section of Block 14 as noted in the following map:

The Common Interest Zone is to be economically shared on a 50%/50% basis by the two countries. This is a high-potential offshore area that holds strong indications of hydrocarbon deposits and leads.

Following the signing of the cooperation agreement, the two countries will enter into a Production Sharing Contract with the Block 14 contractor group, led by operator Chevron. A model of such PSA was agreed last month.

The Common Interest Zone has a long and protracted history with a lot of back and forth in the negotiations between Angola and the DRC. The first Memorandum of Understanding on the subject was inked 20 years ago (on 8 June 2003), which was followed by a “Cooperation Protocol” approved in 2008. After a long period of inactivity, the two countries reengaged in 2020 and ensuing negotiations culminated in the signing of the new cooperation agreement last week.

Rui Amendoeira – OnelLegal Partner

A new legal regime for self-billing was approved in Angola through Presidential Decree 144/23, of 29 June 2023. Below is a summary of the new rules:

• Self-billing – Self-billing occurs when the buyer of a good or service issues the respective invoice in lieu of the supplier/service provider.
• Subject entities – Self-billing can be required of Angolan taxpayers that have an organized accounting system and which acquire in Angola goods or services from the Primary Sector (agriculture, forestry, aquaculture, beekeeping, poultry farming, fishery, craftmanship, and miscellaneous services). Self-billing is also applicable in case of goods and services provided by individuals who are not capable of issuing invoices. Further, self-billing is applicable to the acquisition of movable assets by individuals for own use.
• Invoices – The invoices to be issued by self-billing entities must contain the following minimum information:
• Taxpayer number or Identity Card/Passport of the supplier/service provider;
• Taxpayer number, name and address of the buyer of the good/service;
• Invoice number;
• Description of goods/services (including quantities/references where applicable);
• Price per item and total in local currency (Kwanza);
• Date of purchase of the goods/services and invoice date;
• Reference to “Self-billing”.

Invoices must be issued in three (3) copies through a certified billing software.

• Threshold – Self-billing should not account for more than 20% of the total cost of goods and services acquired by the invoicing entity. This threshold may increase to 40% in case of goods/services that are essential to the self-billing entity.
• Withholding Tax – Self-billing entities must withhold tax as required under the Corporate Income Tax (Industrial Tax) or Work-Related Income Tax, as applicable.
• Reporting – Self-billing wholesalers must report to the Tax Office whenever they sell goods to individual customers worth in excess of Kz 25.000.000,00.

These rules are subject to a 30-day grace period, which means they are mandatory from 29 July 2023.

Rui Amendoeira – OnelLegal Partner