Interview: Joachim Bilé-Aka

Which provisions should be put in place to improve the legal framework for investment?

JOACHIM BILÉ-AKA: The current legal framework for investment can certainly be improved, but it must be well adapted for both foreign and domestic investors if we are to hope for an even greater increase in private investment. Ensuring greater transparency of tendering procedures can contribute significantly to this if it is reinforced, for instance, by requiring contracting authorities to audit their award procedures, at regular timeframes, varying from three to five years.

How will the 2022 fiscal annex on tax incentives impact the technology and agro-industrial sectors?

BILÉ-AKA: The reform of the tax incentive to reinvest profits made in-country, ushered in by Finance Law 2022, is a setback from our point of view. The reform will increase eligibility for this scheme from CFA10m ($17,200) to CFA100m ($172,000). This closes access to this scheme to smaller potential investments that could have been launched by local entrepreneurs. As a result, it does not reflect a real willingness to provide tax support to investors, either in general or in the technology and agri-business sectors.

To what extent can a comprehensive legal framework facilitate the local operations of multinational corporations, particularly in terms of offshoring?

BILÉ-AKA: The offshoring process can be an important asset if a legal framework exists that both stimulates and secures investment by multinational companies that are in the process of outsourcing some of their activities. As an example, facilitating the use of night work schedules could allow the alignment of working hours here with the working hours of the countries where such multinational corporations already have operations. The development of niche specialities through the training of skilled human capital is also key to attracting multinational corporations.

What are the main legal constraints facing foreign investors today, and how can they be remedied?

BILÉ-AKA: In our opinion, the constraints put on foreign investors are more administrative than legal. The application of certain conventions, laws and decrees by government officials may raise issues of interpretation. Dialogue with the administration has the potential to become a difficult exercise if the public official feels personally challenged, even if the investor is only challenging the legality of the administrative act. The administration should allow its decisions to be examined by administrative mediators or by courts – entities that are responsible for settling differences in the interpretation and application of the law. This could be done by requiring that each administrative decision include the ways and means of appeal that are available to contest it, with suspensive effect.

In what way will recent reforms influence how businesses choose their tax regimes?

BILÉ-AKA: Article 14 of the tax annex to Finance Law 2021 increased the period of validity of the tax system certificate of companies under a real tax system by two years, in order to benefit from the exemption from withholding tax as an advance payment of income tax in the informal sector. This reduces the administrative formalities required of businesses and may encourage those who were subject to flat-rate tax regimes to consider opting for a real tax regime.

Why is a suitable legal framework essential to the transition towards a more sustainable economy?

BILÉ-AKA: To protect the environment, the global production and distribution systems of goods and services must be modified. The establishment of a framework that encourages companies present in the country to adopt sustainable production methods will certainly foster a wider transformation of the production methods of other companies, here and abroad.