Angola: New Foreign Exchange Regime for Mining Activities

By way of Order 2/23, of 9 February 2023, the Angolan Central Bank (BNA) has enacted a new foreign exchange regime for mining activities in Angola (“Mining Forex”). Below is an outline of the Mining Forex:

Entities covered: The Mining Forex is applicable to the following entities:

• Holders of rights for reconnaissance, prospecting, exploration, exploitation, cutting, commercialization and marketing of minerals;
• Diamond cutters;
• Sellers and buyers of rough diamonds or other minerals;
• Exporters of rough or cut/polished minerals;
• The state-owned Diamond Trading Company, SODIAM;
• Other state-owned mining companies;
• Other related entities involved in the extraction of minerals.

Export: All exports of Angolan minerals (in a rough or cut/polished state) must be paid in hard currency;

Revenues: Export revenues are processed as follows:

• Angolan investors – they must bring the funds to local (Angolan) bank accounts, except as needed to reimburse external loans;
• Foreign investors – they can keep the funds outside Angola, except they have to import funds to (i) pay local taxes, and (ii) pay local suppliers.

Payments: Payments between local entities must be settled in local currency (Kwanza),  except in the following cases where settlement in hard currency is permitted:

• Transactions between the producers and SODIAM;
• Transactions between the producers and the diamond cutters;
• Transactions between the diamond cutters and SODIAM.

All payments must be made by electronic transfer between bank accounts with local banks. Cash withdrawals and payments are prohibited.

Bank accounts: Entities covered by the Mining Forex must open accounts with local banks in both local (Kwanza) and hard currency. Hard currency accounts are funded by exports. These accounts (hard currency) can be used for the following purposes:

• Reimbursement of hard currency loans (bank and shareholder loans);
• Payment of dividends to foreign shareholders;
• Payment of imports of goods and services;
• Purchase of local currency;
• Other hard currency operations permitted by law.

External loans: Entities covered by the Mining Forex may obtain foreign loans to finance their mining activities without need to seek BNA approval. In the context of such loans, foreign escrow accounts may be opened and the buyers of Angolan minerals may be instructed to make payments into these accounts directly for repayment of the loans.

The previous regulations dealing with the subject matter are revoked, including BNA Order 13/20, of 29 May 2020.