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Cape Verde: New Investment Code

(Aug. 15, 2012) On July 11, 2012, Cape Verde published a new Investment Code Law in its Official Gazette (Law 13/VIII/2012). The new Code replaces two previous laws, Law 90/IV/93 of December 13, 1993, and Regulatory Decree 1/94, of January 3, 1994. This legislation will come into force when a Tax Incentives Code, still under discussion, is completed. (Eduardo de Proft Cardoso, Cape Verde: New Investment Code Published, TAX NEWS SERVICE (Aug. 13, 2012).)

Under the new Investment Code, new rules on foreign investment will be introduced in Cape Verde, but major legal principles, rights, and guarantees are maintained. The key points of the law are:

  • non-discrimination between national and international investors;
  • protection of private property against seizure, nationalization, or expropriation, except as in the public interest and under certain conditions;
  • free currency conversion and transfer abroad of income acquired in Cape Verde, to apply to dividends, royalties, profits from shares' sales, capital repayments, and interest income; and
  • ability of foreign investors to have accounts in multiple currencies at financial institutions in the country. (Id.)

The Code favors arbitration as a mechanism for settling investment disputes between the government of Cape Verde and foreign investors, under national and international dispute resolution rules. This includes Cape Verde law (such as Law 76/VI/2005, on National and International Arbitration, 33 BOLETIM OFICIAL (Aug. 16, 2005), GLOBAL LEGAL INFORMATION NETWORK, GLIN ID No. 216956) and the Washington Convention of March 1965 that covers disputes between nations and foreign nationals in investment matters. (de Proft Cardoso, supra.; Convention on the Settlement of Investment Disputes Between States and Nationals of Other States (Washington Convention), International Centre for Settlement of Investment Disputes website (last visited Aug. 13, 2012).)