The law differentiates between urban leases, which are governed by both the Angolan Civil Code and Law no. 26/15, of 23 October 2015 (Lease Law) and rural leases, governed by specific provisions of the Civil Code.
Urban leases may be for residential and non-residential purposes, included in the latter are the lease of industrial real estate, commercial facilities, offices, retail or any other legally admitted use (commercial leases).
Contracts for the use of shopping centre units have been used as an alternative to commercial leases. They cover the use of a grouping of stores, the provision of services and common parts. However, the legal framework for such use has not yet been approved. So, such contracts are becoming more popular and are nevertheless construed according to the Lease Law.
Last modified 1 Aug 2019
Commercial leases may be granted for a fixed period of time or for an undetermined period of time.
The length of a commercial lease is decided by agreement between the parties, with a maximum limit of 30 years. In the event that the parties do not set forth a term, the contract shall be deemed to be in force for a two-year term, automatically renewable. Any lease of more than six years is subject to registration under the Land Registry Office.
Last modified 1 Aug 2019
The law establishes specific standards for residential and non-residential purposes. There is mandatory information that must be included in the leases, such as the complete identification of the parties, identification of the leased premises and registry number under tax office, the purpose, term, rent amount and execution date.
Regardless of the purpose of the lease, all buildings or units must be licenced and the lessor must provide evidence of licencing, namely a copy of the use license (certificado de habitabilidade). Failure to comply with this requirement triggers the payment of a fine to the relevant public authority, of a sum not less than three monthly rent payments.
Additionally, all commercial leases must be entered into before a public notary.
Yes, the lessee is covered by a special provision of the law and the lease will not end following the elapse of its contractual term and lessee will be entitled to automatically renewals. An exception to this rule pursuant to the Lease Law occurs when parties expressly address in the Lease the:
Break option of the lessor, and
A contract term of more than five years
Provided the two mentioned conditions are met, the lessor can terminate the lease and, in such case, the lessee has to leave the premises upon elapse of the contract. Additionally, if the lessee is a natural person, in the event the lessee dies the commercial lease does not expire. The lessee’s heirs have the right to the transfer of the lease, within 180 days after the lessee’s death. If the heirs do not wish the transfer of the lease they must waive it by written notice to the lessor, within 30 days of the lessee’s death.
Last modified 1 Aug 2019
If the parties have entered an automatically renewable lease, the lessor is not entitled to prevent such automatic renewals and thus the contract may only be terminated in the specific cases set forth in the law.
If the parties have entered a lease for a fixed period of time of more than a five-year term, and the lessor has terminated the agreement by sending a written notice to the lessee, within the agreed notice period, upon termination of the lease, the lessor may start legal action for eviction.
Last modified 1 Aug 2019
The lessor can only terminate the contract before the term elapses if the lessee defaults, thus ending the former’s obligation to maintain the contract. The law defines an exhaustive list of causes that may entitle the lessor to proceed with the termination of the contract.
The lessor has to start a lawsuit, which is a time-consuming process (approximately two to three years).
Last modified 1 Aug 2019
Leases may be terminated by public entities in exceptional cases, such as when there is public interest justification, in which case the parties are entitled to compensation.
On the other hand, administrative authorities may carry out works in leased buildings when the lessors do not execute such works, and the lease has to be suspended for as long as the works are being carried out. In these situations, the lessee is entitled to be relocated and when the works are completed, lessees are allowed to reoccupy the premises on specific terms established by the law. If the lessor does not pay for the works to the administrative authorities, the administrative authorities are entitled to recover the costs under a compulsory collection procedure against lessor by means of judicial procedure.
Last modified 1 Aug 2019
The lessor may demand in the contract that the lessee provides guarantees, the most common being the following:
Personal responsibility by a third party
A security deposit for an agreed amount usually equal to six to twelve monthly rents (that the lessor is only required to return after the termination of the lease), and
The purpose of the leased property has to be defined in the lease, in accordance with the type of legally permitted use for the property (which is certified by the relevant administrative authority who issues the use license (certificado de habitabilidade).
The permitted use cannot be changed by lessee without the lessor’s or the relevant administrative authority’s consent.
The use of the property for any purpose other than the one which it is licensed for is considered to be a contractual default by the lessee, constituting justification for termination of the contract by the lessor, who may apply to court to obtain the termination of the contract.
Otherwise, the lease of property for any purpose other than the one mentioned in the relevant use license may trigger the payment of fines.
Last modified 1 Aug 2019
The lessee may only carry out the works when the lease agreement includes authorization for this purpose or subject to the lessor’s prior written consent. In the event that improvement works are carried out the lessee is entitled to compensation. Typically, the lease agreement sets forth a waiver to such compensation.
If the lessor is compelled to execute works by the relevant administrative authority and does not carry out such works or in case the works are urgent, the lessee may carry out said works provided that (i) a budget for the works is provided by the relevant administrative authority and (ii) the lessor is duly informed of the cost of such works.
In this scenario, the lessee is entitled to the payment of the expenses and in the event of delay, interest applies.
Last modified 1 Aug 2019
In general, transfers of leases to a third party require the lessor’s consent.
However, commercial leases may be transferred by conveyance without the lessor’s consent. Notice must be given as the lessor has a pre-emption right. The conveyance has to be executed by deed.
A transfer of an establishment (a temporary and costly transfer of the use of the property, together with the operation of a commercial or industrial establishment) does not require the lessor’s authorization, but the lessor should be informed within 15 days, in writing. The transfer agreement has to be executed by a public deed.
The lessee cannot sublet the property, either totally or partially, without the lessor’s authorization in writing. Should this authorization not exist, the lessor may terminate the contract based on the lessee’s default.
Any rent updating shall be done in accordance with the legal annual coefficient that is approved by the government. However, for commercial leases:
Whose term is more than five years, or
Without term
the parties may define other ways to update the rent in the contract.
The lessor may make additional rent updates after executing improvement works in the premises that were imposed by the relevant administrative authorities.
Last modified 1 Aug 2019
If the parties have contractually agreed on the rent updating scheme, the calculation of the new rent value is the one indicated in the contract.
If nothing was stipulated, then the annual legal coefficient shall be applied and:
The rent can be annually updated, in accordance with this coefficient
The first updating can be demanded one year after the contract commenced and the following ones, successively, one year after the previous updating, and
The lessor shall inform the lessee, in writing and at least 60 days beforehand, of the updating coefficient and the new rent resulting from it
Last modified 1 Aug 2019
VAT is expected to enter in force in Angola in October 2019 or January 2020. VAT will be imposed on commercial leases.
Except if otherwise agreed, the lessee is responsible for the payment of charges and expenses regarding the supply of goods or services (eg water, electricity, gas, telephone or internet).
The lessee is only responsible for other expenses if it is expressly agreed between the parties.
The lessor is responsible for the payment of the sanitation rate, insurance fees, Property Tax (Imposto Predial Urbano) and the stamp duty of the contract.
Last modified 1 Aug 2019
Except if otherwise agreed, the lessor is responsible for the repair and maintenance of the common parts of the building in which the property is located.
Last modified 1 Aug 2019
Except if otherwise agreed, the lessor is responsible for the repair of the property. However, the parties may agree that the lessee is responsible for these expenses.
It is usual for the lessor to bear the additional expenses of an extraordinary nature (including for the fixed asset structures) and for the lessee to bear the ordinary repair costs (with the maintenance) of the property.
If the lessor is in arrears, the lessee may carry out works of an urgent nature, and be reimbursed by the lessor later on.
Last modified 1 Aug 2019
If not otherwise specified, each lessee will bear those charges and expenses related to their respective use. If it is not possible to separate out usage - due to a global provision of services - mill rate allocation rules may be applied, by usage, by area or in accordance with any other allocation criteria defined by the parties.
Last modified 1 Aug 2019
Usually the lessor insures the property. Lessors may also opt to contract multiple-risk insurance, which also cover the risk of floods, storms, electrical damage, theft and robbery. Some multiple-risk insurance policies may also cover household effects, but it is not the lessor's responsibility to insure these items.
