Angola The New Local content legal Framework for the oil & gas industry

Presidential Decree 271/20, of 20 October 2020 (“PD 271/20”), approved the new legal framework for the promotion of local content in the oil and gas industry, expressly repealing Ministry of Petroleum Order 127/03, of 25 November 2003 (“Order 127/03”).

Maintaining the general goals and principles of the local content policy that has been followed by the Government untouched, PD 271/20 contains a number of novelties in relation to the preceding legal regime worth noting, of which we would like to highlight the following:

•Encouragement to National Companies

As a rule, the associates of the National Agency for Petroleum, Gas and Biofuels (“Oil Companies” and  “Concessionaire”, respectively), as well as any other companies operating in the oil sector (all oilfield service companies and any other contractors and subcontractors, “Contractors”) [Oil Companies and Contractors are hereinafter jointly referred to as “Oil Industry Companies”] must acquire raw materials, goods and equipment manufactured in Angola and services provided by:

Angolan Companies – means companies incorporated under the laws of Angola, whose share capital is wholly (100%) owned by national individuals or companies; and
Angolan Incorporated Companies – means companies incorporated under the laws of Angola, irrespective of the nationality of its shareholding.

In order to bid for the tenders launched by the Oil Industry Companies, both the Angolan Companies and the Angolan Incorporated Companies are required to produce evidence that they have the capacity to supply the goods or provide the relevant services, namely, without limitation, in terms of equipment, staff or other criterion that may be deemed relevant.

Whenever Angolan Companies and Angolan Incorporated Companies compete on the same tender, preference should be given to the former in the award of the contracts.

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