Timor Leste

• Creation or expansion of a company
• Acquisition of part or all of the shareholdings of a commercial company, participation in the increase of its capital or provision of supplementary capital instalments;
• Execution and amendment of joint ventures and any other form of association agreement;
• Execution and amendment of contracts involving ownership or the management of companies, establishments of an agricultural, industrial and commercial nature, real estate complexes and other facilities or equipment intended for the development of economic activities;
• Financial resources from supplies made by an investor to a commercial company in which he participates or any other financial resources related to the reinvestment of profits and dividends in the same company;
• Purchase, lease or acquisition of any other real rights over real estate in national territory, when this acquisition is part of private investment projects,
• Acquisition or import in favour of the goods or capital equipment allocated to the enterprise, including the contracting of the respective insurance and freight;
• Acquisition or import in favour of the raw material company or semi-processed goods for exclusive investment or reinvestment;
• Free transmission to the company of industrial secrets, copyrights, industrial property rights, trademarks, or any other intellectual property rights that are recognized by law;
• All rights recognized by law or contract and all licenses or authorizations issued in accordance with the law;
• Provision of any other amounts of money or equivalent for the exclusive realization of the investment or reinvestment.

Most attractive sectors in Timor-Leste for foreign investors are Oil & Gas, Public infrastructure (roads, buildings), telecommunications (cell phone and internet), agriculture (coffee and local harvest).

• income tax exemption, in the amount of 100%, for a period of 5, 8 or 10 years, depending on the investment zones;
• 100% sales tax exemption on all capital goods and equipment used in the construction or management of the investment or reinvestment project, for a period of 5, 8 or 10 years, depending on the investment zones;
• exemption from tax on services in the amount of 100% vis-à-vis undertakings dedicated to the provision of specified services, for a period of 5, 8 or 10 years, depending on the investment zones;
• exemption from customs import duties in the amount of 100% on all capital goods and equipment used in the construction or management of the investment or reinvestment project, for a period of 5, 8 or 10 years, depending on the investment zones.

• USD500,000.00 and,
• USD250,000.00 in the case of a joint venture or legally permissible partnerships between a foreign investor and a national resident, in which they control, for at least 75% of the stakes of the companies involved.

The State may, exceptionally, enter into a special investment agreement with an investor to define special conditions for investment projects that (due to their size or nature, or due to their economic, social, environmental or technological impact) may be of great national interest, which justifies the adoption of other specific benefits, of a non-fiscal nature, to be negotiated with the investor.

• Payment of imports;
• Payment of principal or interest on loans taken out abroad;
• Payment of rights and management services.

The right to freely transfer funds abroad must be exercised under the terms of the applicable regulations of the Central Bank, being limited only by the application of general legislation, such as tax legislation.

• Equal treatment between a foreign investor and a national investor (with the exception of land ownership).
• All investors have the right to fair and equitable treatment having all legal means of an administrative and judicial nature in force aimed at ensuring the full protection and security of their investments.
• All investors are guaranteed equal access to the courts to defend their legally protected rights and interests.
• All investors have the right to freely access all the legislation regulating the legal regime for private investment and all that may influence the investment in question, namely, tax, labour, migration and social security legislation.
• The State is obliged not to adopt an expropriation or nationalization policy that directly or through equivalent measures will deliberately harm the private investor’s enterprise in the national territory.
• All investors can import goods and equipment and export the products and services produced.
• All investors can freely use internal and external credit to finance the project.
• All investors are guaranteed, in accordance with current legislation, the right to freely transfer funds from any investment or reinvestment in Timor-Leste abroad.
• All investors can request the conversion of values into foreign currency through the banking system, as well as transfer these values abroad to fulfil financial obligations assumed in relation to investments made, such as:
  • Payment of imports;
  • Payment of principal or interest on loans contracted abroad;
  • Payment of rights and management services.
• All investors are entitled to the protection of industrial secrets, copyright, industrial property rights, trademarks, or any other intellectual property rights that are recognized by law.
• All investors are guaranteed respect for professional, banking and commercial secrecy.
• State authorities, services, officials and agents are obliged to keep all information and documents provided in connection with an investment or reinvestment confidential.
• All investors can hire qualified foreign workers or collaborators for technical, supervisory or managerial functions, under the terms of the migration and asylum law.
• Any non-resident foreign or national worker or employee has the right to freely transfer the net income obtained as a result of the work contract.