Mozambique’s Local Content Law for oil and gas: what Law 9/2026 requires of foreign suppliers
Law 9/2026 of 3 June 2026 is Mozambique’s first dedicated Local Content Law for petroleum operations. It reaches every company that contracts with a concessionaire or its contractors, defines who counts as a Mozambican or preferred supplier, ranks bids by local content before price, and gives a new Authority the power to fine. This page sets out the rules as published and the structuring choices they create for a foreign supplier.
Who the law applies to
Article 3 applies the law to holders of petroleum rights and concession contracts, to third parties executing petroleum operations, to vehicles set up by concessionaires, and to every other entity that signs a contract with any of them. Those entities must impose local content obligations on their own subcontractors by contract and are jointly liable if the subcontractors fail. Subcontracting arrangements entered into by private employment agencies are excluded from the scope of this law (article 3 no. 4).
The law was approved alongside the new Petroleum Law (Law 8/2026, which repeals Law 21/2014). According to Mayer Brown’s note on the new Petroleum Law, that law separately requires foreign service providers to associate with Mozambican persons or companies.
Definitions relevant to supplier qualification
| Term in the law | Definition (glossary, Law 9/2026) | Practical reading |
|---|---|---|
| Mozambican legal person | A legal person registered in Mozambique with its seat and effective management in national territory | A wholly foreign-owned subsidiary incorporated and run from Mozambique meets this definition. A branch of a foreign company does not have its seat in Mozambique |
| Preferred person (pessoa preferente) | A national legal person with at least 20% of its share capital held or controlled by Mozambican citizens or Mozambican public or private companies or institutions, and whose workforce and payroll are predominantly Mozambican | The status relevant to the application of the preference criteria set in the law. Twenty percent national capital is the threshold, not 51% |
| Local content (art. 15 and 19) | Economic and industrial value and knowledge transfer generated in Mozambique through national labour, goods, services and know-how; measured as % LC = (1 − imported components / total production value) × 100, weighted with qualitative elements: 50% local production, 25% share capital, 25% national workers | Imported raw materials, depreciation of imported assets, interest paid abroad and foreign salaries all reduce the score. Local hiring and local purchasing raise it |
The three procurement regimes
Article 25 obliges every covered entity to procure under one of three regimes. Which one applies depends on the goods or services and on who can supply them.
Preference regime (art. 26)
The law sets the following preference criteria: Mozambican persons; Mozambican persons with a higher share of Mozambican-held capital; those whose goods and services use national production factors; those with a larger Mozambican payroll; and Mozambican legal persons that can deliver in the time and quantities required. It does not spell out a ranking among them. A qualifying Mozambican supplier wins as long as its price, including taxes, is not more than 20% above the lowest comparable price from a qualified foreign supplier. Article 16 adds the evaluation rule: local content requirements are assessed first, technical and commercial capacity second, and when offers are close the bid with the higher local content percentage is selected if it costs up to 20% more. Preference is a price advantage, not an exclusion: where the goods or services cannot be acquired in Mozambique on these terms, article 26 no. 2 allows the buyer to turn to other suppliers, with justification to the Authority.
Exclusivity regime (art. 28)
Goods and services that meet three cumulative conditions must be bought in Mozambique: produced or provided with at least 80% national production factors; by Mozambican companies with at least 20% of capital held by Mozambican persons or companies; and with a payroll at least 50% Mozambican. The law annexes a list of goods and services considered abundant in Mozambique that fall under exclusivity, to be updated by regulation. Article 27 adds a community layer: 30% of exclusivity goods should come from the project’s province and 15% of semi-skilled jobs are reserved for residents of the districts concerned.
Free-market regime (art. 29)
Where neither of the above can be met, supply and demand apply, through public tender as a rule, and national or foreign suppliers or partnerships may be contracted. The law says this regime applies in particular to main contracts and to contracts involving technology, patents or special requirements, including construction, operation and maintenance of infrastructure, with a stated preference for companies registered and operating in Mozambique. This is where most specialised foreign engineering and equipment sits.
What this means for how you structure
| Structure | Status under Law 9/2026 | Where it competes |
|---|---|---|
| Wholly foreign-owned Mozambican subsidiary (Lda or SA, seat and management in Mozambique) | Mozambican legal person; not a preferred person | Preference regime as a Mozambican person, and the free market; its local purchases, local hires and payroll raise its own and its clients’ local content score |
| Branch of a foreign company | Not a Mozambican legal person (seat abroad) | Competes where foreign suppliers are admitted. Local registration does not give it the status of Mozambican legal person or preferred person; whether its own local content elements count must be checked against the category, the regulation and the tender criteria |
| Company or partnership with at least 20% Mozambican capital and a predominantly Mozambican workforce and payroll | Preferred person | Stronger position under the preference criteria (national capital, national production factors, Mozambican payroll); exclusivity categories when the 80% production-factor and 50% payroll tests are also met |
| Consortium with a Mozambican firm for one tender | Each member keeps its own status; how the consortium’s local content is assessed depends on the regulation and the tender rules | Useful for a single package; must be repeated for the next contract and each member needs its own registration and tax compliance |
Article 17 encourages partnerships between national and foreign persons in any form the commercial law allows and sets the same floor: at least 20% of the share capital held by nationals. Article 18 permits subcontracting to third parties that meet local content requirements, but forbids a supplier that won work under the preference or exclusivity regimes from subcontracting the whole scope without the Authority’s express authorisation.
Certification, plans and reporting
- Certification (art. 21): goods and services with national components are certified by entities accredited by the Local Content Authority, which attest the local content percentage. A national person is classified as a national supplier when it holds such a certificate. Validity and renewal are left to the regulation.
- Procurement plan (art. 20): project owners file an annual plan with the Authority covering opportunities and timetable, budget by activity, goods, services and labour to be procured, training and knowledge transfer, supplier development, and the forecast purchase of financial, legal and accounting services.
- Human resources development plan (art. 32) and the mandatory local content clause in every supply contract (art. 30 no. 3): the plan binds project owners; the contract clause is how the obligations reach each supplier, so read it before signing.
- Reporting (art. 23): an annual performance report against the approved plan is due by 30 April, including a community benefit index (direct jobs by district, spend with suppliers based in the project province, new SMEs created, training investment).
- The Authority (arts. 10 to 14) is a public body under the minister for petroleum, must publish approved procurement plans, the list of certified national suppliers and an annual list of services by category, accredits certifiers, inspects (ordinary inspections with seven working days’ notice, extraordinary without) and is funded in part by a percentage of every supply contract.
On 13 October 2026 the Council of Ministers approved the regulation of Law 9/2026 and the statute of the Local Content Authority, together with the Petroleum Operations Regulation (official communiqué of the 29th ordinary session). As of 18 October 2026 the published text, the decree numbers and their entry into force could not be confirmed. Certification procedures, fees and transitional rules must be read against those decrees once their official text can be consulted and their entry into force confirmed.
Penalties
Fines for the administrative infractions in articles 33 and 34 range from USD 50,000 to USD 300,000, converted at the Bank of Mozambique rate of the day; failure to file reports on time carries a fixed USD 150,000. Sanctions also include loss of tax benefits, cancellation of concession contracts and exclusion from future tenders under the Petroleum and Local Content Laws. Splitting contracts to avoid the regimes and omitting the mandatory local content clause are themselves infractions.
Keeping the evidence from day one
Local content is proven with accounting data. The formula in article 19 needs the value of imported components, the depreciation of imported assets, interest paid abroad and foreign salaries, separated from the rest. From the first invoice, tag purchases by supplier nationality and certification status, tag payroll by nationality and position, and keep training records. A chart of accounts designed for this on day one costs little; rebuilding the evidence from mixed ledgers later is expensive and hard to defend in an audit.
Frequently asked questions
Does a Mozambican-registered subsidiary of a foreign company count as a Mozambican legal person?
Yes, if it is registered in Mozambique and has its seat and effective management there. It is not a preferred person unless at least 20% of its capital is held by Mozambican persons or companies and its workforce and payroll are predominantly Mozambican.
Is there a minimum Mozambican shareholding?
The law uses 20% as the threshold for preferred-person status, for partnerships (art. 17) and for the exclusivity regime (art. 28). There is no 51% rule in Law 9/2026.
How much more expensive can a local bid be and still win?
Up to 20% above the lowest comparable price from a qualified foreign supplier, including taxes, when the local bidder meets the preference requirements (art. 26) or when offers are close and it has the higher local content percentage (art. 16).
Who enforces the law?
The Local Content Authority created by article 10, under the minister for petroleum, with powers to approve plans, accredit certifiers, inspect and sanction. Its statute and the law’s regulation were approved by the Council of Ministers on 13 October 2026.
Does the law apply to mining?
No. Law 9/2026 covers petroleum operations under the Petroleum Law. Mining has its own local content rules under the Mining Law.
Sources
- Lei n.º 9/2026, de 3 de Junho (Lei de Conteúdo Local), Boletim da República I Série n.º 104, 3.º suplemento, via INP
- MIREME: Lei de Conteúdo Local abre mais oportunidades para participação de nacionais
- Conselho de Ministros: comunicado da 29.ª sessão ordinária, 13 Outubro 2026
- Lei n.º 8/2026 (Lei dos Petróleos), BR I Série n.º 104, 2.º suplemento, via INP
General information prepared by dBA from legislation and public sources available at the date shown. It is not tax or legal advice. Confirm how it applies to your case with our team before acting.
Related services
Talk to Dércio da Barca, Managing Partner
Thirty minutes to understand your case: structure, timelines, risks and costs. He replies personally with a first assessment within 24 business hours.
