Business entities in Mozambique in 2023

Since 2003, Healy Consultants Group PLC provides our Clients with the best corporate structures for doing business in the Republic of Mozambique. There are several ways of doing business in Mozambique, the commonly used corporate structure being the limited liability company. Entrepreneurs may also establish a public limited company for larger investments or float shares to the public. Foreign entities may also set up a branch office or a representative office.

• The Mozambique limited liability company (Lda)

  • The Mozambique limited liability company (LLC, also known as Lda) is the most commonly used corporate structure by entrepreneurs setting up small and medium-sized businesses in Mozambique;
  • A Lda requires at least 1 director and 1 shareholder of any nationality and who do not need to be resident in Mozambique. The shareholders may be individuals or corporate bodies;
  • Foreign directors of a local limited liability company must obtain a personal tax number. They are however not obliged to file tax returns in Mozambique unless they receive a salary locally;
  • Upon incorporation, an LLC must also appoint a local accountant who will file monthly VAT returns with the Mozambique Tax Office.

• The Mozambique public limited company (SA)

  • The Mozambique public limited company (PLC, also known as SA) is recommended for companies looking to publicly list in the Mozambique Stock Exchange;
  • To be established, this entity requires at least 3 shareholders and 1 director who can either be individuals or legal entities and must not be resident in Mozambique;
  • A Mozambique public limited company may only appoint a single director when its share capital does not exceed US$17,500. Any company with share capital above this figure must appoint at least 2 directors;
  • This entity does not have a stated required minimum share capital, but at least 25% of the entire agreed share capital must be paid in during Mozambique company incorporation process;
  • The Mozambique PLC is required by law to appoint a statutory auditor or a board of auditors comprising of 3 or more auditors.

• The Mozambique branch (commercial representation)

  • The Mozambique Commercial Code allows foreign legal entities looking to do business in Mozambique to establish branch offices;
  • To establish a branch office, a foreign company must first obtain approval from the Ministry of Industry and Trade and secure a business license;
  • A branch office is not considered a separate legal entity therefore the scope of its operations in Mozambique is defined and controlled by the parent company;
  • During Mozambique business setup, the parent company must appoint at least one resident individual of any nationality to be the company’s representative in Mozambique.

• The Mozambique representative office (commercial representation)

  • Foreign entities are permitted to establish representative offices in Mozambique. Unlike a branch office, such corporate structure does not need to be registered for tax and VAT but is not allowed to engage in any commercial activities;
  • A representative office is permitted to operate in Mozambique for a renewable 3-year period and is only allowed to conduct i) market research and ii) promote activities of the parent company;
  • During the registration process, the parent company must appoint at least one representative in Mozambique, who can be of any nationality.

• Comparison table between Mozambique business entities

  	LLC	PLC	Branch office	Rep office
  Also known as	Lda	SA	Commercial representation	Commercial representation
  How long to set the company up?	4 weeks	6 weeks	9 weeks	9 weeks
  How long to open company bank account?	4 weeks	4 weeks	4 weeks	4 weeks
  Legal liability?	Limited	Limited	Unlimited	Unlimited
  Wholly foreign owned?	Yes	Yes	Yes	Yes
  Minimum share capital?	US$1	US$1	US$1	US$1
  File annual tax return?	Yes	Yes	Yes	No
  Tax registration certificate required?	Yes	Yes	Yes	No
  Recommended corporate bank account?	Barclays Bank	Standard Bank	BancABC	First National Bank
  Does our Client need to travel?	No	No	No	No
  Resident director required?	No	No	No	No
  Resident shareholder required?	No	No	No	No
  Minimum directors allowed?	1	1	1	1
  Minimum shareholders?	1	3	1	1
  Tax identification code (TIN) needed?	Yes	Yes	Yes	No
  Mozambique resident company secretary required?	No	No	No	No
  Local accountant required?	Yes	Yes	Yes	No
  Corporate shareholders allowed?	Yes	Yes	Parent company	Parent company
  Corporate director(s) allowed?	Yes	Yes	Yes	Yes
  Mozambique corporate tax rate?	32%	32%	32%	0%
  Annual financial statements required?	Yes	Yes	Yes	No
  Statutory audit required?	No	Yes	Yes	No
  Regulated by?	Ministry of Justice	Ministry of Justice	Ministry of Justice	Ministry of Justice
  Allowed to issue sales invoices?	Yes	Yes	Yes	No
  Allowed to sign contracts?	Yes	Yes	Yes	No
  Allowed to import and export goods?	Yes	Yes	Yes	No
  Can rent an office space in Mozambique?	Yes	Yes	Yes	Yes
  Can buy Mozambique property?	Yes	Yes	Yes	No
  Can own equity in other Mozambique companies?	Yes	Yes	Yes	No
  Total Mozambique business setup costs in Yr. 1	US$20,700	US$21,700	US$27,925	US$26,975
  Subsequent annual costs (incl. accounting and tax fee)	US$5,800	US$5,800	US$11,690	US$9,390
  Sample engagement invoice	View invoice PDF	View invoice PDF	View invoice PDF	View invoice PDF