Breaking: Access to credit – Movable warranties law on the cards for Mozambique

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Breaking: Access to credit – Movable warranties law on the cards for Mozambique

4:49 CAT | 05 Aug 2016

Notícias

According to Noticias, the Ministry of Justice, Constitutional Affairs and Religion has presenetd a proposal to regulates the movable warranties, introducing a movable property register, to facilitate credit guarantees based on such property.

To date, credit is only granted against real estate, and other property deeds such as mineral, oil, credit and others, are ineligible as guarantees.

The chairman of the Financial Policy of the Confederation of Economic Associations of Mozambique (CTA), Luis Magaço, however has said that his college received for consideration a government proposal for a Secured Transactions Law that “will allow the enlargement of the instruments required by the financial sector to provide credits”.

Magaço was speaking this week in Maputo during a consultation workshop on the proposed Secured Transactions Law sponsored by the CTA.

The event brought together representatives of various private entities, from the financial sector especially, and participants discussed a draft law aiming to create a legal framework for guarantees based on goods not previously subject to property registration.

This instrument will provide for the creation of a central guarantee registry which will have as its primary mission the electronic registering of information on the guarantees on movables.

“The CTA shared this proposal with its members, and the workshop debate revolved around the proposed law, especially in relation to its advantages for the business environment improvement,” Magaço explained.

Magaço said the most important aspect of the bill was the facilitation of credit and the safety of creditors, including banks.

The proposed Secured Transactions Act arises from need for the country to promote access to credit through the establishment of a system that diversifies and strengthens legal certainty in the provision of movables as guarantees, as well as the availability of information about them.

Source: AIM