The Law of Secured Securities as a vehicle for boosting funding for the real/primary sector of the economy
  1. Real/ Primary Sector of the Economy

Angola has taken steps towards the decentralized intervention model, which is based on the intervention divided between the State and the Private Sector. In this model, the State must act as a legislator, regulator, supervisor and guide (passive intervention), intervening, only when necessary, as a producer of goods and/or services (active intervention).

In this respect, Presidential Decree n.º 78/23, of March 28th[1], which extended the implementation period of the national privatization program (PROPRIV), approved by Presidential Decree n.º 250/19, of August 5th, for the period 2023-2026, clearly demonstrates the State's position regarding the model it intends to adopt.

Going forward, since the economy is the rational management of existing resources, which are later transformed into goods and services to be made available to the general population, it can be stratified into 3 (three) main sectors of activity or economic sectors: Real / Primary, Secondary and Tertiary.

The Primary sector, which is called here, comprises the branch of activity linked to the exploitation of one of the production factors, in this case, the land, as a source of raw material.

Agriculture, livestock, fishing and mining and marine extraction (sea salt) make up the mosaic of the main activities of the Primary sector.[2]

With the demographic growth that has been registered (the number of inhabitants of Angola grows by a percentage of 3.5 per year, currently reaching 30 million), there is a need to resort to techniques and technologies that are sufficiently up-to-date to meet demand, in perspective of supplying the needs of the population.

With regard to agriculture, livestock and fishing, if it is true that Angola already had self-sustaining conditions, the truth is that the war reversed this trend, forcing the population to restart the path already traveled.

Since the end of the war, in 2002, there has been an increase in harvests, however, still far from what would be needed to satisfy the internal market and, eventually, for export.

On the one hand, certain characteristics of the country facilitate the exploration process and are a mechanism of attraction for those who want to invest in this area (vast territory easily adapted to cultivation, variety of types of terrain and climates, country rich in water, with a coastline of more than 1,650 km2 and a great diversity of fish, thanks to the beneficial flow of the cold Benguela current, to the south, and the warm current, to the north[3]).

On the other hand, given that the development of the sector is one of the Executive's priorities, the fact that most of the population is dedicated to these activities represents another attraction for the development of such activities.

Despite the preponderant role that the primary sector plays in the economy, the truth is that it continues to face significant difficulties, which are later reflected in the results.

The lack of investment for the execution of projects, connected to the need for specialized machinery and the improvement of conservation systems, for processing and commercialization, have represented some of the obstacles to the dynamization of the primary sector.

In this regard, it is urgent to recapitulate that the majority of players in this sector are individual people (peasants, fishermen), some with substantially low income or small and medium-sized companies (hereinafter “SMEs”), who intend to enter the market and/or streamline its activities.


2. The movable guarantees Law as a vhicle for boosting financing


In this sector , individuals, as well as SMEs, play a fundamental role in the growth and development of any economy, as they contribute significantly to raising economic and social levels, especially in the contribution to the Gross Domestic Product (GDP), in the creation of jobs, as well as in the promotion of self-sustainability and possible export of products. However, the channels usually used to obtain financing present conditions the are too onerous for the development of activities and the viability of projects[4].

Bearing this reality in mind, the Executive has tried to promote various initiatives with a view to reducing the degree of difficulties, with particular focus on the creation of funding sources, allowing for a more adequate treatment of the country's various socio-economic realities.

One of the options created to meet the demands of the current economic and social context was the establishment of the legal regime applicable to the use of movable property as a guarantee of the fulfillment of obligations, upon approval of Law No. 11/21, of April 22nd.

Indeed, guarantees play a preponderant role in accessing credit, often being a condition for contracting financing, since creditors intend to be sure that their capital will be refunded and the respective remunerative interest paid under the agreed conditions and terms.

The law applies to all securities granted to the creditor[5], which are intended to ensure the fulfillment of an obligation, regardless of the form of the act, the nature of the guarantee, or the fact that the guarantee was constituted with the delivery of the good.

It also applies to definitive conventional assignments of credits, including with regard to constitution, publicity, order of priority and financial leasing.


Mortgage guarantee, for the purposes of this article, is the guarantee constituted over tangible and intangible movable assets, including pledge, mortgage, assignment of credits in guarantee, fiduciary alienation in guarantee, sale with reservation of ownership and any other legal transactions whose function be the constitution of a guarantee on a movable property.

The Law, whose analysis and framework we are concerned with, significantly changes the regime applicable to real rights over movable property contained in the Civil Code, which is why there is an urgent need to discuss the main characteristics:


2.1 Constitution of the guarantee

The guarantees can be created by contract, court decision or legal provision, it being established that the contracts are valid and effective between the parties as long as they appear in documents signed by the parties.

Security guarantees may consist of one or more movable assets, determined or determinable, present or future (assets not yet in the possession of the guarantor or to which he is entitled, at the time of issuance of the business declaration), tangible or intangible, fungible or non-fungible, as long as they can be sold for consideration when the guarantee is constituted. In the case of future assets, they take effect from the date on which the guarantor acquires real rights over the asset.

For the contract, the law defined minimum requirements for its preparation[6] and, in situations where the guarantor and the debtor are different persons, the guarantee only becomes valid as long as the guarantor signs the guarantee constitution contract or performs the delivery of the good.[7]

The guarantee may also be constituted verbally, provided that i tis accompained by the delibery of the good.


2.2 Warranty Effects:

The cases where the guarantor and the debtor are different persons, the guarantee only becomes valid as long as the guarantor signs the contract constituting the guarantee or delivers the asset.

In relation to third parties, the guarantee only takes effect if the following assumptions are met:

  1. On the date of its availability for consultation on the website of the Central Registration of Secured Securities;
  2. By delivering the tangible asset or the document confirming the availability of the asset to the creditor or a third party;
  3. With the conclusion of a control contract[8], when the guarantee concerns a bank account or financial assets.


The priority of conventional, judicial and legal guarantees is determined by the date on which each one became enforceable against third parties. The guarantee may cover one or more obligations of any kind, present or future, determinable or definite, conditional or unconditional, fixed or variable. If the amount of guaranteed credit is indeterminate or variable, the contract must establish the maximum guaranteed amount.

In situations where the contract is concluded between the third party guarantor and the creditor, the guarantee only becomes valid with the express consent of the debtor.

Therefore, in order for it to be enforceable against third parties, it must be registered at the Central de Registo de Garantias Mobiliarias (CRGM), or in the case of quotas and bank assets or financial assets, provided that they appear in the control contract.

Guarantees on vehicles, aircraft, ships and vessels, acquisition guarantees (constituted on assets financed by the creditor), guarantees or credit assignments not represented by negotiable instruments, including when resulting from the sale or lease of real estate, are only enforceable against third parties if registered.

Mineral and petroleum resources to be extracted may be encumbered by the holder of the right, solely for the purposes of financing said exploration or extraction.


2.3 Warranty Registration

Presidential Decree n.º 114/21, of April 29th, which came into force on the same day, created the Central de Registro de Garantias Mobiliárias (“CRGM”), which is an electronic public service that centralises, for the purpose of advertising , all information on the registration of guarantees constituted on movable property, also establishing the procedure for registration, modification and consultation.

It aims at strengthening the financial system and diversifying the assets held, as well as reducing the concentration of operations in the financial system.

By virtue of this diploma, the registration of a guarantee and the respective assignments is carried out by the creditor, by the assignee of a credit or by the lessor, as the case may be, with the competent service for the registration of ownership of the asset on which the guarantee applies and CRGM disseminates this information.

In the case of goods not subject to registration of ownership, registration is carried out on the computer platform managed by CRGM. The platform was implemented by the Ministry of Justice and Human Rights, it works with the National Directorate of Identification, Registration and Notary.

Registration on the platform (crgm.gov.ao) involves creating an account, where all the data of the person, whether natural or legal, must be entered. Once the account is created, the desired registrations can be made. The platform allows you to search for records, regardless of whether you have an account or not, that is, anyone can search for third-party securities guarantee records.


2.4 Transfer of Warranty

The guarantee is transmitted with the guaranteed credit, unless otherwise agreed[9]. The buyer or lessee who acquires a good encumbered by a duly published guarantee, acquires it with the respective encumbrance, except:

  1. In cases where tangible property is acquired or leased in the course of the ordinary management of the guarantor;
  2. When dealing with Money of transfer of funds into a bank account and the recipiente is unaware of the existence of the guarantee;
  3. If the good is for tangible consumption of low value.

As for subparagraphs a) and c), the cases in which the purchaser has effective knowledge of the guarantee and acts with the intention of defrauding the debtor's rights are excluded from the previous paragraph.


2.5 Warranty execution

In the event of non-compliance, enforcement may be judicial or extrajudicial, with appropriation of the asset by the creditor and direct sale being permitted, provided that it is expressly provided for in the contract and certain conditions are met[10].

Extrajudicial enforcement takes place whenever the debtor defaults on his obligations, after notification of the performance of the due diligence, within a period of five working days, if the contract does not provide for another. This type of execution includes the appropriation of the asset given as guarantee, provided that it is expressly provided for in the guarantee contract.

In this way, the credcitor has the right to appropriate, making the object of the guarantee his own, without the need to resort to the court or any other authority in cases where the the contract so provides.

If the debtor does not deliver the asset, the creditor may resort to public force, without the need for court intervention.

If the aforementioned options prove to be unsuccessful, the creditor must resort to judicial execution.


3. The movable Guarantees Law as a vehicle for boosting financing for the real/primary sector of the economy?

Law n.º 11/21 represents a breath of fresh air with regard to the possibilities of acquiring financing. It provides greater security and fluidity to financing, as it allows assets that were previously not subject to registration and, as such, could not be used to ensure the proper fulfillment of credit obligations, now, being subject to registration, now guarantee the good fulfillment of the debtor's obligations to the creditor.

For the real/primary sector of the economy, bearing in mind the social reality and the difficulties in accessing bank financing, this Law represents the possibility of obtaining credit in good time and without the need to offer guarantees that would unsustainably burden the company/producer.

Indeed, the assumption of guaranteeing machinery used in the activity itself, the debtor's or third party's movable property (upon authorization) and even the product of the activity, as a future good (be it the fruit of the harvest, fishing, among others) , allows real sector players to back up their investment in a more sustainable way.

In addition to the above, the freedom to negotiate the conditions for granting credit allows for better adaptation to each case and response to the needs of the debtor, as well as the requirements of the creditor.

There are no doubts that the Law, on a theoretical level, represents a vehicle for boosting and capturing investment.

Despite the advantages for creditors and debtors arising from this new regime, we anticipate that some practical difficulties will arise.

On the one hand, difficulties may arise in making the Security Registration Center fully operational, namely in the transition of existing data registered in other Public Institutions. The difficulties experienced in communication between Public Institutions will undoubtedly generate delays in the operationalization of the guarantees provided for in the Law.

On the other hand, the limited experience of accessing an electronic-only platform (CRGM) and the use of sophisticated tools, such as electronic signatures, could constitute another practical constraint. In this respect, it is worth remembering that the real/primary sector is developed, not exceptionally, by individuals based and residing in provinces other than the capital, with limited access and computer knowledge.

Once these constraints have been overcome, and the content of this Law has been disseminated, it is believed that conditions exist for the real/primary sector to be boosted, moving towards development, sustainability and eventual export.

Aline Simões


[1] Considering that there are ongoing privatization processes, as well as the need to register new State assets and holdings in PROPRIV, within the scope of the reform of the State Business Sector, there was a need to update the Privatizations programme.

[2]In turn, the Secondary sector comprises the branch of activity dedicated to the transformation resulting from the production of the primary sector by industrialization and the Tertiary sector is the sector dedicated to the provision of non-tangible services, namely, banking, insurance and reinsurance, tourism, restoration, among others.

[3] Despite the capture carried out with modern technology, by foreign fishing boats, the dominant fishing continues to be artisanal.

[4] For exemple, resorting to bank credit continues to imply, among other obligations, the payment of very high interest rates, which is not compatible with the activity carried out by a rural peasant, responsible for supporting a family of more than 6 elements.

[5] It is the act by which the holder of economic rights transfers such rights, in whole or in part, in general, to another. This means that, with regard to what was assigned, the previous holder will no longer be able to make decisions and/or dispose, passing to the legal sphere of the assigned.

[6] Article 7 of Law No. 11/21, of April 22 (RJGM)

[7] Article 4 of Law No. 11/21, of April 22 (RJGM)

[8] Agreement by which the debtor transfers to the creditor his powers of control over his financial assets, which must be made known to the competent financial institutions.

[9] Art.º 49.º RJGM

[10] Art. 62.º RJGM

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