Mozambique


Author: Vieira de Almeida & Associados - Sociedade de Advogados, SP R.L.

Contact: E-Mail (nc@vda.pt) (nlp@vda.pt)

Overview of legal measures as of 15 June 2020 as response to the coronavirus. . Please note: Due to the extraordinary situation, the legislation is in continuous evolution and may change very fast.

Introduction

Managing the Impacts of COVID-19

Companies on a global level are feeling the effects of the spread of the Coronavirus (COVID-19). The present context raises legal questions that have a profound impact on businesses in different sectors and on society at large. The implications are broad and complex, and we are committed to focusing our knowledge and experience to help you navigate these new legal issues as they arise.

1. State of Emergency

1.1 Concept and implications

By means of Presidential Decree 14/2020, of 28 May 2020 (as ratified by Law 6/2020, of 29 May 2020), the President of the Republic extended for the second time the state of emergency originally declared through Presidential Decree 11/2020, of 20 March 2020, as ratified by Law 1/2020, of 31 March 2020. Consequently, we need to address certain key issues of the regime and how they have been implemented by the relevant acts.

The declaration of a state of emergency is an act carried out by the President, following consultation of the Council of State and of the National Council for Defence and Security, and that it is subject to a subsequent ratification by the Parliament, which shall determine or allow for the determination of a suspension or limitation of freedoms and guarantees of citizens in case of actual or imminent aggression, serious threat or disturbance of constitutional order or of public calamity.

The state of emergency legal framework is laid down in Article 282 et seq. of the Constitution of the Republic of Mozambique.

In practical terms, the declaration of a state of emergency may involve the partial suspension of certain rights, freedoms and guarantees, as ordered: e.g. a ban on travel or freedom of assembly.

The declaration of a state of emergency grants public authorities’ powers to adopt the necessary and adequate measures, exempting them from complying with certain formalities in doing so, if necessary with recourse to the Defence and Security Forces.

As a rule, the declaration of a state of emergency must abide by the principle of proportionality and be limited, in particular regarding its scope and duration and the resources used, to what is strictly necessary in view of the specific circumstances.

The state of emergency cannot affect rights of superior constitutional dignity identified in the law and the Constitution. The declaration of a state of emergency may not, under any circumstance, suspend or limit the constitutional rights to life, to personal integrity, to personal identity, to civil capacity and citizenship, to the non-retroactivity of criminal law, to the defendants' right of defence or religious freedom.

As for its content, the declaration must specify which rights, freedoms and guarantees are suspended.

The following – general and special – restrictive measures will remain in force for the duration of the state of emergency (see Article 3 of Presidential Decree 14/2020, of 28 May 2020):

(a) the issuance of entry visas is suspended, and any visas already issued will be cancelled;

(b) in-person classes are suspended in all public and private schools;

(c) prohibition of all public and private gatherings, such as religious cults, cultural, recreational, sporting, political, associative, touristic and any other kind of events, except:

i. unavoidable State matters;

ii. social matters, such as funeral ceremonies;

iii. practice of physical exercise, in open spaces;

(d) suspension of all court and administrative deadlines, including disciplinary proceedings;

(e) suspension of statutes of limitation and expiry deadlines for all proceedings and procedures;

(f) preventive measures must be implemented at all private and public institutions and public transport;

Special measures shall apply in the following cases:

(a) compulsory home quarantine, from 14 to 21 days, for all citizens (i) arriving in the country, (ii) that have been in places with registered active cases and (iii) that had direct contact with confirmed cases of COVID-19. Health authorities shall adopt effective control mechanisms in any such event;

(b) correct and conscious use of cloth masks or other material and/or visors in all places of agglomeration of people, such as public roads, markets, common areas and in public and semi-collective transport of passengers;

(c) limitation of internal movements of individuals in any part of the national territory if there is an exponential increase in contamination. A cordon sanitaire may also be established;

(d) individuals are required to stay in medical facilities as in-patients for therapeutic purposes;

(e) limitation to the entry and exit of individuals to/from the Mozambican territory due to the partial closure of the borders (except for state matters, humanitarian aid, health and cargo transportation);

(f) real-time traceability of individuals through geolocation;

(g) requisitioning of healthcare, similar and other ancillary services;

(h) shutdown of entertainment or similar establishments;

(i) supervision of the prices of essential goods for the population, including the goods required to prevent and counter the pandemic;

(j) promoting and redirecting the industrial sector towards the production of inputs necessary to fight the pandemic;

(k) adoption of sustainable fiscal and monetary policy measures to support the private sector to face the economic impact of the pandemic;

(l) job rotation and other solutions in accordance with the specific job areas;

(m) creation of alternative forms of assistance, such as telephone and/or e-mail, to replace face-to-face assistance in public and private institutions.

A state of emergency may be declared regarding all or part of the national territory and must only be declared regarding such area or territory where the measures are deemed required to ensure or restore normality. In the present case, the declaration of a state of emergency applies to the entire national territory, pursuant to article 1 of Presidential Decree no. 11/2020, of March 30.

Regarding its duration, the state of emergency shall only last for as long as strictly required to protect the envisaged rights and interests and to restore normality. Maximum duration is 30 days, without prejudice to any renewal for one or more identical periods if the cause determining it, should subsist. The state of emergency cannot be renewed more than 3 times.

In the present case, the state of emergency was extended for an additional 30 days’ period, beginning at 00.00 a.m. on 31 May and ending at 11.59 p.m. on 29 June 2020. Failure to respect the measures ordered by the authorities constitutes a crime of disobedience.

1.2 Impact of measures approved by the State

The Government of Mozambique adopted specific measures to stop the spread of COVID-19 and imposed some restrictions, such as limitation of freedom of circulation, restrictions regarding opening and closing hours of establishment’s, based on the need to fight the COVID-19.

As part of the declaration of a state of emergency, the Government has the authority to adopt measures to combat and prevent COVID-19, and through Decree no. 26/2020, of 8 May, as amended by Decree no. 32/2020, of 20 May, it has taken a series of mandatory restrictive measures based on the need to combat COVID-19, which are reinforced by Presidential Decree 14/2020 and include home quarantine, the possibility of civil requisition of doctors, nurses and other health personnel, among others.

It is important to note that public health guidelines issued by authorities are not always binding. However, compliance with these guidelines is correlated with the fulfilment of duties of care, which in turn may protect and exonerate companies from claims based on non-contractual civil liability (or other reasons).

Companies should therefore be prepared to identify and respond quickly and appropriately to legislative or regulatory changes, as well as to analyse instructions or guidelines provided. Companies should also appropriately register the preventive measures taken spontaneously or in compliance with laws, guidelines or administrative regulations associated with COVID-19.

2. Labour Issues

2.1 Impact on the management of employees

Contingency Plan

Although the law, notably Decree no. 26/2020 (as amended) does not expressly require companies to prepare and put in place a Contingency Plan, such obligation appears to be required under the general principles of prevention to which employers are subject to, embodied in their duty to provide their employees with continuous and permanent safety and health conditions.

Hence, in the current context, although the law does not expressly state it, companies should adopt a Contingency Plan in connection with COVID-19 infection, which must contain:

· a list of the work places which are temporarily closed and those that will operate on a minimum service basis;

· the composition of the respective minimum service teams (working in rotation);

· the scheme under which the members of that team should provide work (either in the work place or at home);

· rules pertaining to the organization of the work and interaction between employees at the company’s premises and at home;

· the procedures to be adopted in case any employee shows symptoms of COVID-19;

· hygiene and safety measures to be enforced within the establishments especially aimed at preventing the spread of COVID-19, namely those established in the legal provisions, as follows:

o Social distancing of at least one and a half meter (1,5m);

o Cough etiquette;

o Frequent hand washing;

o Disinfection of facilities and equipment;

o No sharing of personal utensils;

o Airing of facilities;

o When applicable, reduction to a maximum occupancy of 20 (twenty) people, in meetings or places of agglomeration, except for those situations that cannot be postponed related to the State functioning.

The on-site workforce shall be reduced to 1/3 and shall start working on a rotational basis (with teams rotating each 15 days). Notwithstanding, companies producing essential goods (including, food and beverages, chemistries and goods and equipment for the health sector) are allowed to maintain more than the 1/3 limit, provided that a formal request is addressed to the Ministries of Labour and Industry and Commerce.

In addition, to the extent that some employees may be more prone to contagion, specific measures should be considered to ensure an increased level of protection in such specific cases. Such measures should, as far as possible, be assessed in conjunction with the Occupational Safety and Health Services, as well as in conjunction with the recommendations of health authorities.

On the other hand, the Labour Law admits that, in the context of the execution of the labour contract, the company may require the employee to undergo or be submitted to medical tests or examinations to evidence his/her physical or mental condition to perform his/her functions.

However, under the terms of the same law, the employee has the right to privacy and to not allow access and disclosure of information related to the employee's intimate and personal life, including his or her state of health.

Employees subject to special measures

Employees who are infected with COVID-19 are exempted from work (on-site or teleworking), as well as employees for whom some health authority has determined an active surveillance/prophylactic isolation situation (quarantine).

The following employees are entitled with a special protection:

· pregnant employees;

· employees aged 60 or over;

· employees with a chronic disease considered to be at notably, immunosuppressed employees, kidney disease patients, hypertensive employees, diabetics, cardiovascular patients, employees with chronic respiratory disease and cancer patients.

To the extent that there are employees in one of the situations described above, specific measures should be considered to ensure an increased level of protection in these specific cases. Such measures should, when possible, be linked to the recommendations of the health authorities. In addition, employees who are in the conditions described above and who must provide services during the period of the State of Emergency, have priority in the release to work on-site.

Employees working at home

Telework may be required by the company, since the law determines that it is up to each company to define the modalities of work from home, as long as it is compatible with the employees’ duties, thus, the employees’ consent is not required.

Employees may also ask to perform telework, as long as this type of work is compatible with the nature of functions to be performed.

Work insurance policies normally cover issues relating to incapacity for work, death as a result of an accident or illness, and occupational diseases. To this end, the insurance policy for accidents at work and professional diseases should be accessed to determine whether or not the risks are covered in this new reality.

Special duty of information

Although recent legislation relating to COVID-19 does not provide for any obligation to inform the company’s employees, it is essential that, employers keep employees regularly informed about measures to prevent and control the abovementioned disease, as well as define the measures to be adopted in a rotational work system and telework. In particular, the company's Contingency Plan should be known to all employees, and its disclosure will necessarily have to take this concern into account. In addition, mechanisms should be introduced to facilitate contact between the company and the employees, with respect for private intimacy, but also ensuring a centralized monitoring and treatment of issues.

Prophylactic isolation of employees

Both employees who have recently entered the country and employees who have had contact with confirmed cases of COVID-19 must be subject to compulsory home quarantine for 14 days.

Otherwise, namely when there are well-founded suspicions of contagion by COVID-19, the isolation of the employee should, as far as possible, result from a decision of the health authority. Should it not be possible to obtain such decision in due time, the isolation - and consequent abandonment of the company's premises, if this is the case - should be determined by the employer, in articulation with the union representing the company's employees or, in the absence of the latter, the union of the company's sector of activity and the National Directorate of Labour.

To the extent that the employees' symptoms are not preventing the performance of the professional activity, work mechanisms may be implemented at home, and it is up to the company to create the necessary conditions for this effect.

Impacts of isolation on the employment contract and maintenance of the right of remuneration

If the isolation is not preventing the performance of the professional activity, it will be neutral from a labour point of view, and employees maintain the right to their remuneration. As for the remaining benefits, namely those associated with the usual dislocation to the company premises, a case-by-case analysis should be made in order to verify whether or not the assumptions, on which their payment depends, continue to occur in the state of isolation.

Social benefits for employees

The Decree approving the implementing of administrative measures for the prevention of COVID-19 does not establish any exceptional measure to safeguard the social protection of employees who are temporarily prevented from exercising their professional activity by order of the health authorities.

However, it will always be necessary to consider that if the employee falls ill while carrying out his duties, the Social Security protection shall apply and in that case the employee will be entitled to sickness benefit and hospitalization allowance, as provided for in the social security regulation. In the event of death, the death allowance, funeral allowance and survivor's pension will be paid.

Remotely work

Assuming that the isolation does not result from a situation of incapacity, the employee may continue to work remotely, and the company must ensure that the necessary conditions are met in the specific case. Desirably, the remote work should have the agreement of the employee and any refusals should be managed by the company on a case-by-case basis in order to safeguard both the continuity of the production process and the legal guarantees that the employee is entitled to.

Changes to previously scheduled vacation should, preferably, be made with the agreement of the employees. If an agreement is not reached, the possibilities for the company to reschedule the holidays are strongly limited. However, for imperative reasons linked to the company, the satisfaction of essential and unavoidable needs or the interests of the national economy, the company may postpone the total or partial enjoyment of holidays by the employees, until the holiday period of the following year, provided that certain communication duties established by law have been met.

Maintenance of job positions and mitigation of corporate crisis

Under the prevention and control measures of COVID-19, apart from the prohibition to terminate labour relationships based on the absence of the employees from the workplace, the Government did not adopt any other exceptional measure, with a view to maintaining job positions and mitigating corporate crisis situations.

In any case, in order to mitigate the impacts of the corporate crisis resulting from the current situation, companies may consider adopting some of the readjustment mechanisms foreseen in the Labour Law, such as (i) suspension of employment contracts, (ii) setting of a part-time work schedule, or (iii) implementation of model or variable working hours.

Under the law, the employer may unilaterally suspend employment contracts grounded in economic reasons, resulting, but not limited to, market reasons, disasters or other occurrences that have or are, predictably, affecting the normal activity of the company, provided that certain prior reporting obligations laid down in the law have been fulfilled. In this case, the employer is obliged to pay employees only a percentage of their monthly remuneration and only during the first three months of suspension. In addition, the law also allows employers to implement modeled working hours, in which daily and weekly limits are calculated in average terms, by reference to a certain period of time, meaning that, during a period of crisis, the employer can reduce the daily and weekly workload, so as to enforce a more demanding daily and weekly workload (above the normal work limits established by law) of recovery of activity in the post-crisis period, without being obliged to pay, therefore, overtime.

3. Tax and Contributory Obligations

3.1 Tax measures to mitigate the impact of COVID-19

Under Decree 23/2020, of 27 April 2020, local economic operators affected by the impact of the Covid-19 can benefit from the following facilities and incentives:

customs:

- Economic operators will be granted an early exit authorization in connection with the import of products to prevent and treat COVID-19 until 31 December 2020. Imports must be regularized within 90 days.

Economic operators need to submit an affidavit of responsibility to the proper Customs Services to be able to enjoy this prerogative.

tax:

- general release from the obligation to make payments on account in May, July and September 2020;

- deferment of the special payment on account that should be made in July, August and October 2020 to January, February and March 2021; and

- taxable persons holding VAT claims will be able to offset such claims against other tax liabilities charged by the Tax authorities until 31 December 2020.

In order to benefit from the facilities set out in paragraphs (1) and (2), taxable persons must:

- have had a turnover not exceeding MT 2,500,000.00 in 2019;

- have their tax affairs in order; and

- submit a duly reasoned application in accordance with the regulations that will be issued by the Minister for Finance.

Note that the payment of taxes on the import of food, medicines and other essential goods will be settled later, on terms to be defined;

4. Corporate Governance

4.1 Impact on corporate governance

Duties and responsibilities of governing bodies of companies within the context of COVID-19 events

Companies’ governing bodies are subject to special duties of care in the management of the risks inherent to the COVID-19 threat.

Companies should prepare and implement contingency plans geared at continuing their business and the safety of their employees, shareholders, customers, suppliers and other stakeholders.

Whenever possible, companies should create taskforces to monitor, on one hand, the evolution of contagion and contention of the COVID-19 in close liaison with the health and other relevant authorities and, on the other hand, the economic, financial and commercial impacts that materialize or that could foreseeably impact their business or that of third parties, adjusting their commercial strategies in order to minimize and overcome any issues that may arise.

It is particularly important that such plans be communicated in a timely manner to all structures of the companies, implemented, monitored and reviewed, if required. It is equally important that the process of setting up and approving such plans by the company’s decision-making bodies is guided by rational business criteria and duly documented. Members of the governing bodies may be held liable for the absence of such plans or losses arising from the failure to communicate them on time.

In-person meetings of the corporate bodies

Although not expressly provided by law, current circumstances may serve to justify the postponement of meetings already convened or even to revoke notices of meetings in order to minimize the risks associated with holding face-to-face shareholder meetings. It is also important to ensure timely and adequate communication of the decisions in question to the shareholders and other members of the corporate bodies involved. This issue is particularly relevant in the context of public companies and/or companies with dispersed capital, for which a large turnout at annual general meetings is expected.

In any case, and whenever it proves necessary to approve resolutions to be taken by general meetings, companies should consider promoting the use of telematic means or unanimous resolutions in writing, making the necessary adjustments.

In addition, in relation to meetings of the other corporate bodies, contingency plans may be considered to avoid the physical presence at meetings of at least part of the members or other measures to ensure the existence of a sufficient quorum at such meetings, namely the use of telematic means, and the regulations that prove to be necessary or appropriate for this purpose may be approved.

5. Contracts

5.1 Impact on the management of contracts

Impact of COVID-19 related to contractual arrangements

In order to assess the impact of any COVID-19-related events on contractual relationships you should first check whether the contract already provides for solutions regarding this type of event (e.g., force majeure clauses that cover epidemics, change in circumstances clauses, clauses for the suspension or extension of deadlines in light of non-attributable events, etc.).

As part of any standard interpretation of a contract, even if there the contracts include clauses foreseeing specific solutions for those events, you should always check whether those solutions are valid under the law applicable to the contract, in an exceptional and emergency scenario such as the current scenario. The applicable law shall determine the legal regime to be considered both in the interpretation of the Agreement and in the search for legal solutions not covered by the contract, such as the legal framework for changes in circumstances or impossible performance.

Contractual obligations

If a contractual obligation cannot be definitively performed, Mozambican law foresees the expiry of such obligation due to impossibility, provided that the causal link between the COVID-19 event and the impossibility to perform the agreed obligation is duly demonstrated.

If, on the other hand, my contractual performance is only temporarily impossible, and the performance deadline is just delayed, Mozambican law also foresees that the debtor will not answer for the consequences of the delay.

These effects are not effective automatically but are predicated on the specific situation at hand. Besides, they always require solid evidence, and therefore it is advisable, as a cautious manner, to keep adequate supporting documentation should the need to claim an objective impossibility to perform arises.

Should the contractual obligation become impossible, the relevant party has no obligation to compensate the other party. But if the other party has already performed its obligation (e.g., payment of the service) such payment would need to be returned, and if return is not possible, compensation should proceed..

Also, if someone allege that the obligation has become excessively burdensome in order to be excused from its performance, theoretically it is possible to use that argument (e.g.: the price set for my service has become ruinous in light of the changes caused by the COVID-19 to the distribution chain), alleging that the circumstances in which the parties decided to enter into the contract have changed. However, the validity of such allegation is predicated on the assessment of the relevance of the event for the performance of the contract, the risks inherent to the contract, the specific provisions of the contract and the equity of the measure.

Any solution will always be grounded on the ability to prove the facts that modified the original circumstances underlying the contractual terms and ultimately the equity and balance of the solution.

Breaching of contracts in place with third parties related to facts of COVID-19

If the contractual obligation becomes impossible or excessively burdensome following a chain default (e.g.: I cannot perform because my key raw materials’ supplier fail to supply them due to the shut down by an administrative order of its factory) Mozambican law states that, provided that some requirements are met, the obligation may expire in the same terms as described above. In any case, it will always be required to prove the causal link.

Reaction of clients’/suppliers’ default with the justification based on COVID-19 cases

In some cases, it is possible to claim losses of interest in the obligation and terminate the contract without compensation (e.g., someone ordered a certain product from a company, which claimed it could not deliver the product because its supplier had temporarily or definitively shut down its factory). Loss of interest in the obligation is foreseen in Mozambican law as is the option of terminating the contract as a result of said loss of interest, without compensation and being able to demand the return of any obligation already performed.

Notwithstanding and as mentioned above, the review of the specific contract and the relevant documentation in place between the parties is crucial to this conclusion.

5.2 Impact on leases

Temporary measures applicable to lease agreements

During the term of the state of emergency, the eviction proceedings by landlords are forbidden in the residential leases. This regime does not exempt the tenant from the obligation to pay the rent.

6. Finance

6.1 Impact on loans - moratorium measures

With regard to bank credits, pending the state of emergency all interpellations, arrears and executions arising from the delay in the fulfilment of obligations that cannot be carried out as a result of the application of the measures provided for in Decree no. 26/2020 of 8 May (as amended) shall are deemed ineffective.

In the absence of a specific provision in this regard, it seems to extend to all bank customers, i.e., companies, individuals and other legal entities with bank credits contracted in Mozambique.

This measure covers credit operations granted by credit institutions operating in Mozambique and this measure does not give rise to ineffectiveness or termination of guarantees granted, which remain in force.

The referred measure shall be applied upon demonstration by the debtor (in court, within the limit) of a causal link between the delay in complying with obligations relating to bank credits and the application of the measures provided for in Decree No. 26/2020 of 8 May (as amended).

This regime will be in force pending the state of emergency.

Credit institutions and financial corporations shall provide the following minimum services:

o deposits, cash withdrawals;

o transfers of funds;

o all necessary operations carried out through digital channels.

The Bank of Mozambique may establish other criteria for minimum services and may also implement measures deemed required for the functioning of the payment subsystems, define the terms and conditions for the use of payment instruments, among others.

7. Insurance

7.1 Impact on insurance management

[Risks inherent to COVID-19

COVID-19 and the official pandemic declaration by the WHO is a novel situation, it is therefore recommended tocarefully review insurance policies to understand whether related insurance claims correspond to risks covered by the policy.

It is important to check if there are no exclusions that would exclude you from the scope of the coverage. Exclusions can be more or less detailed, with more concrete or more general reference to diseases, epidemics or pandemics. It is important to consider how the terms used intersect with the guidelines issued by the WHO and other official health authorities.

A detailed analysis of the policy conditions is also essential to assess the deadlines and contents for notifying the insurance company of the claim, as well as the means of proof required for exercising your rights.

Work Accidents

The infection resulting from the virus is not an accidental event, therefore, in principle, it is not covered under the work accidents insurance. An infection by COVID-19 in a work context (e.g. infection of healthcare professionals) has already been recognised by the World Health Organisation as an occupational disease and as such is excluded from the work accidents insurance coverage.

For employees carrying out their activity through teleworking, the cover of a work accident will depend on whether the applicable requirements are met. For this purpose, the employer must document the telework, including (i) keeping of an internal record with the names of the workers, (ii) the dates and (iii) the authorised times, (iv) the addresses were the teleworking will be provided and (v) the prior authorisation of the employer.

Personal Accidents

As stated above, the infection resulting from the virus does not correspond an accidental event and therefore, in principle, is not covered by a personal accidents insurance.

8. Public Administration & Public Procurement

8.1 Impact on the relationship with the Public Administration

In broad terms, the consequences of COVID-19 on relations between private individuals may also, with certain adaptations, be extrapolated to the relationship between individuals and the Public Administration, notably and always subject to a case-by-case analysis:

· qualification as a "force majeure" event, as grounds for not complying, in whole or in part, with obligations provided for in an administrative contract, in particular with regard to deadlines (depending on what the contract specifically provides for and provided that a causal link between the illness and the impossibility of meeting deadlines is evidenced, as well as the impossibility or unenforceability of taking alternative measures, or their insufficiency, and always without prejudice to the counterparty's duty to inform);

· claiming the occurrence of an abnormal and unforeseeable change in circumstances as grounds for amending the contract and/or restoring the financial balance;

· claiming a "justifiable reason" as grounds for excusable non-compliance with deadlines before the Public Administration (or, at least, as a ground for requesting an extension of the deadline).

Further, it is worth mentioning that Decree 26/2020 (as amended) establishes that pending the state of emergency the issuance of official documents, including IDs and visas, is suspended. Similarly, it is provided that licenses, permits or other types of administrative acts that have expired during this period shall remain valid.

8.2 Impact on public procurement procedures

The COVID-19 can be streamlining acquisition procedures pursuant to Article 37 of Decree No. 26/2020 of 2 April (as amended) the acquisition of goods and services urgently required to control and combat the pandemic, , namely medicines, hospital supplies, biosecurity material, diagnostic tests and other essential materials, are subject to an exceptional simplified contracting regime, in terms to be defined by the Ministry of Economy and Finance.

In regard to bids already submitted in a public procurement procedure claiming the disruption caused by COVID-19 could be grounds to release the bidder from the bid submitted provided that it is duly justified (such disruption must be an event which the bidder was not required to be aware of at the time of preparation of the bid and that demonstrably renders performance impossible or excessively burdensome).

9. Natural resources

9.1 Measures related to the industry

To date no specific measures have been adopted for the extractive industries. Companies operating in these sectors are subject to the general rules arising from Presidential Decree 12/2020, Decree 26/2020.

The above notwithstanding, considering the weight of the oil & gas and mining industries in the national economy, although they are neither expressly qualified as "essential industries" for the purposes of article 18(8) of Decree no. 26/2020, nor do their services fall under the concept of “essential services” as set out in Article 8 of Presidential Decree 14/2020, we believe that both fall under the definition of "industries critical to the functioning of the economy", provided for in that same article and, consequently, can maintain a labour force above the general rule of 1/3.

In addition, given the rule that all licenses, permits and other administrative acts remain valid until the end of the state of emergency, regardless of their period of validity, in the absence of an express or implicit rule to the contrary, this principle should also be extended to licenses or permits for exploration of oil and mining resources.

10. Litigation

10.1 Impact on litigation matters

The courts are still functioning, but with some restrictions. Presidential Decree 14/2020 determines that the judicial holiday regime is applicable to procedural acts and proceedings, allowing only urgent acts to be carried-out, namely precautionary measures and others related to minors at risk.

In addition, the Supreme Court ("SC"), through Directive no. 01/TS/GP/2020, of 23 March, established a set of individual and collective prevention measures against the OVID-19 pandemic, which must be observed by the Judicial Courts. Among others, the SC recommended that hearings be held only in the presence of parties, lawyers, witnesses, declarants and/or other essential procedural actors, and ordered that the mediation services of the Judicial Court of the City of Maputo be suspended and that the recommendations and instructions given by the health entities be strictly complied with.

As mentioned above, urgent cases are ongoing as yet and therefore whoever is summoned for them should attend. In any case, it will always be possible to justify the non-attendance in an act to be performed in person or at a distance, for health reasons or any other pertinent ones, subject to acceptance of same justification by the judge.

Also, it is important to stress that Law no. 1/2020, of March 31, determines that procedural deadlines are suspended for the duration of the state of emergency and limitation periods are suspended for the duration of the State of Emergency.

11. Sanctioning aspects

11.1 Penalties

[In the context of an epidemiological public health crisis, during which some assets are considered to be very important for preventing and combating disease, anti-economic and public health offences are of particular relevance.

The laws that implement and regulate some aspects of the state of emergency have expressly reinforced the possibility that some behaviour constitutes a crime of disobedience. For example, failure to comply with the obligation of mandatory confinement will fall within this type of crime.

If an infected person infects other persons the Criminal Code provides for a crime of contagion of serious illness which shall be applied if someone commits an act by which he or she transmits or is likely to transmit to another person a serious illness, knowing or should know that he or she is infected.

In regard to companies and its managers it required to have preventive measures as a result of guidelines from the authorities, in particular public health because it may have liability arising from the failure to comply with the general duty of assistance provided for by law, under which, in a situation of public calamity, the necessary assistance must be provided to remove the danger.

Another cause of liability may be failure or non-compliance with the preventive measures decreed by the authorities, in so far as it is subsequently demonstrated that such failure contributed to the spread of the disease.

The company or its managers may also be charged with committing a crime of disobedience, which will be automatic in a state of emergency and will have to be expressly commented in order of the authority or normative act in the remaining cases.

The companies must also meet its regulatory obligations during the epidemiological crisis because there is legislation to the contrary.

It should be noted, however, that the general principles of exclusion of fault provided for in sanctioning legislation, namely exculpatory need and conflict of duties, remain in force and can be invoked.

In the event of the occurrence of any situation where, for pressing reasons, it is not possible to comply with the regulatory obligations or guidelines of the authorities, it is advisable to preserve all the documentation and information that allows proof of the legitimacy of the breach or delay in complying with the obligation or order.

It is important to bear in mind that that criminal law has no retroactive application, which means that the criminalization or creation of misdemeanours during the epidemiological crisis is only possible after the respective entry into force and never in relation to situations that occurred at an earlier time.

Also, situations created in the crisis, with a view to not punishing certain events in which in normal circumstances they would be punished (e.g. submission of expired declarations) are only valid for the period expressly stipulated in the law creating the derogation regime and cannot be claimed outside this circumstance.

12. Transportation & mobility

12.1 Impact on transportation & mobility

The Government has ordered the closure of all frontier crossing points, excluding:

· Frontier crossing points – Land:

o the Negomano, in Cabo Delgado Province;

o Mandimba, II Congress and Entrelagos, Niassa Province;

o Melosa, in Zambezia Province;

o Cassacatisa, Cuchamano and Zóbwè, Tete Province;

o Machipanda, Manica Province;

o Chicualacuala, Gaza Province; and

o Ressano Garcia and Namaacha, Maputo Province

· Frontier crossing points – Airports:

o Pemba Airport, Cabo Delgado Province;

o Mocímboa da Praia Airport, Cabo Delgado Province;

o Lichinga Airport, Niassa Province;

o Nampula and Nacala Airports, Nampula Province;

o Quelimane Airport, Zambézia Province;

o Chingodzi Airport, Tete Province;

o Chimoio Airport, Manica Province;

o Beira Airport, Sofala Province;

o Inhambane and Vilanculos Airfields, Inhambane Province; and

o Maputo Airport, Maputo City.

· Frontier crossing points – Maritime ports:

o Port of Pemba and Mocímboa da Praia, Cabo Delgado Province;

o Port of Nacala, Nampula Province;

o Ports of Quelimane and Pebane, Zambézia Pronvice;

o Port of Beira, Sofala Pronvice;

o Port of Maputo, City of Maputo.

The Government has defined a maximum limit of passengers on board for public or private collective transportation, in road, rail, sea, river and air modalities, according to the number of seats/ capacity established for each type of transportation.

In addition to the maximum capacity limits, the Government has determined that all passengers on board public or private public transportation shall protect their nose and mouth with the use of masks, regardless of the material used (cloth masks), provided that these have been made in accordance with the recommendations given by the competent health authorities.

Motor-taxi and bicycle-taxi services may be provided, provided that passengers wear masks and that the maximum capacity limit is respected.

All owners of public or private public transportation undertakings or vehicles must guarantee health and safety conditions. Failure to comply with measures imposed by the Government will result in the seizure of the vehicle.

Regarding applications for issuance permits for transport activities, it is important to note that the Ministry of Transportation and Communications, by means of Circular No. 02/GM/MTC/2020 ("Circular"), has suspended the issuance of permits for the commencement of transportation activities.

The measures set out in the Circular apply to the following persons:

o passengers and users;

o transportation operators and service providers and their crew;

o terminal and station managers for road, air, sea and rail transportation;

o supervisory bodies and those overseeing transportation at different levels.

The Circular is in force since 9 April 2020.

Concerning road transportation, the Government has suspended the licenses for international road passenger transportation.

Public cross-border road passenger transportation to and from any neighbouring country is prohibited, except for situations provided for in the SADC guidelines on cross-border transportation operations during the State of Emergency.

Cross-border transportation of goods will continue to be carried out to and from neighbouring countries and crew members will be subject to quarantine measures in accordance with the recommendations of the Health Authorities.

Operators of personalized rental transportation services (taxi), motor-taxi and bicycle-taxi, must strictly comply with preventive measures, including the mandatory wearing of protective masks for all occupants of the vehicle.

Furthermore, the Government has taken specific measures regarding each means of transportation, as follows:

· Air transportation

o For domestic flight operations, disinfection of footwear and hands at the time of boarding and temperature measurement is compulsory.

o Services on board are suspended except for hot drinks and water.

o Cabin crew on board must wear a mask during flight, in accordance with the recommendations of the Health Authorities.

· Rail transportation

o On passenger trains the maximum number of passengers aboard shall be the number of seats.

o The use of protective masks, including those made of cloth or other materials, is compulsory in order to protect the nose and mouth.

o The owners of undertakings and their means of transportation, as well as operators and their crews, shall also ensure the conditions of hygiene and prevention in accordance with the recommendations of the Health Authorities.

· Maritime and port transportation

o In regard to maritime and port transportation, maritime authorities and port managers shall ensure that all members of the vessels’ crews are subject to compulsory health screening.

o During the ships’ stay in port it is necessary to ensure that all members of the crew remain on board.

o Ships calling at national ports must comply strictly with the preventive measures issued by the health authorities for the ship's entry into port.

o The removal of all kinds of waste from the ship should be prohibited.

o All employees working in Ports are obliged to observe the protection and safety measures.

o It must be ensured that the health officer, who is a member of the port authorities' team, must first board to assess the health of the crew members, and only once free practice has been declared on board, will the remaining members of the inspection, customs and migration team enter.

o Managers of sailing clubs, wet docks and tourist resorts who become aware of yachts or other foreign vessels coming to their premises by sea, river or lake shall inform the health and maritime authorities.

Users may only use inter-provincial, inter-district, interurban public transportation in case of necessary and urgent journeys in accordance with the Decree that approves the administrative implementation measures for the prevention and containment of COVID-19.

All entities that oversee the area of transportation at provincial, district, municipal and supervisory levels, in coordination with other relevant entities, shall carry out supervisory actions to ensure compliance with the measures adopted in this Decree.

13. Registries & Notary Public

13.1 Impact on the processing of official documents

The Government has determined that the issue of the following official documents is suspended:

o passports;

o identification document;

o marriage certificate;

o deed registration;

o criminal record;

o registration of vehicle;

o licenses;

o driving licence;

o booklets and property titles.

However, the following notary acts and services are maintained:

o birth registration;

o death record;

o issuance of forensic power of attorney;

o issuance of licenses of foreign commercial representations;

o issuance of foreign trade cards;

o wills;

o qualification of heirs;

o official certification of the criminal record;

o official certification of ownership of property and shareholdings in commercial companies;

o bank credit guaranteed with or without mortgage.

Since official documents are not being issued, Decree No. 26/2020 determines that the following official documents are considered valid and effective until 30 June 2020:

o identification document;

o driving licence;

o identification and residence of foreigners and temporary visas; and

o import order for a vehicle.

Registry and notary offices remain open to the public, although working with certain restrictions. By reference to Circular no. 03/DNRN/027.15/2020 ( “Circular”), issued by the National Directorate for Registries and Notaries, the following services are provided/suspended:

· At the level of the Civil Registry:

o suspension of the celebration of marriages for which the proceedings were filed after the decree of the state of emergency, except for urgent marriages;

o completion of birth and death registers only;

o completion of adoption and divorces, in emergency situations;

o completion of justified urgent procedures.

· At the level of Central Registries, the following act continue to be performed:

o attribution of nationality;

o issuance of certificates of matrimonial capacity, nationality and others considered urgent.

· At the Real Estate Registry level, all act deemed urgent continue to be carried out, except where the number of people attending at the premises is deemed unsuitable.

· At the level of the Legal Entities Registry the following continue to be carried-out: name reservation, registration of companies, sole proprietorships, cooperatives and their amendments, provided that they are of an urgent nature and do not involve the agglomeration of people at the Registry Offices.

· At the Motor Vehicles Registry Office, the following act continue to be carried-out: urgent initial registrations, transfers of ownership and encumbrances, provided that this does not result in a crowding of people on the Registry premises.

· At the Criminal Registry level, criminal record certificates remain being issued, provided that this does not involve the agglomeration of persons on the Conservatory's premises.

· The acts granted by Notary Offices are suspended, except for the following:

o Issuance of powers of attorney for the purpose of alimony, survival, forensic, and other urgent matters;

o Granting of public deeds, of urgent character, involving no more than 3 persons;

o Issuance of deeds of authentication.

The Circular also establishes that the respective certificates, on the abovementioned acts and or normal requests, can be issued, provided they are of urgent character.

In addition to the measures indicated above, the Circular determines some hygiene and safety measures that should be adopted by the staff of the registries, such as the use of protective masks in the attendance to the public.