On Thursday, August 1, the Assembly of the Republic, Mozambique’s parliament, unanimously approved the definitive revision of the Electricity Law.
This legislation establishes the general organization and legal framework for electricity supply activities in the country.
Minister of Mineral Resources and Energy, Carlos Zacarias, presented the justification for the proposed revision, explaining that it is based on Article 51, Section 4 of the law. This section deals with exceptional situations allowing the adoption of different international rules.
The revision aims to safeguard future energy projects and accommodate international investors involved in previous initiatives. Zacarias noted, “We have already developed projects under the old electricity law, but ongoing projects in the sector must be assessed in light of international rules.”
Creditors have been demanding changes, particularly regarding arbitration. The newly amended law allows parties to freely choose the arbitration forum and languages used in the arbitration process, provided simultaneous translation into Portuguese is available. Previously, arbitration had to take place in Maputo and be conducted solely in Portuguese.
Zacarias emphasized that the old provisions had become impractical for some international investment projects.
“The forum was not considered impartial, and the language requirements were ineligible for conducting arbitration processes with international financial institutions,” he explained.
Creditors of current electricity sector projects demand that arbitration, language, and venue choices be viable for facilitating international resolutions.
“Creditors require an impartial forum to resolve any disputes that may arise between the State and concession holders,” Zacarias stressed.
The 9th ordinary session of parliament is scheduled to conclude on Thursday, August 8.
