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COVID-19: Frequently Asked Questions Democratic Republic of Congo

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11/05/2020
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Q: As a business, can I rely on any economic stimulus measures enacted by the Democratic Republic of Congo (DRC) government in response to the Covid-19 crisis? 

A: The DRC government has taken a series of fiscal, monetary, exchange rate and financial sector measures to support the economy during the Covid-19 crisis. These include:

  • Creating a monetary fund to support governmental spending measures relating to the Covid-19 crisis; Any contributions by undertakings to this fund will be considered a deductible cost for the financial year 2020;
  • Decreasing the monetary policy interest rate fixed by the National Bank from 9.0% to 7.5%;
  • Decreasing the coefficient of the reserve of on demand deposits and national currency from 2% to 0%;
  • Supporting the revival of companies' activities by means of zero rate financing from the Fund for the Promotion of Industry (FPI);
  • Providing credit to the food and pharmaceutical sectors;
  • Granting of moratoria on loan repayments, taking into account the situation caused by the Covid-19 crisis;
  • Postponing the USD 50 Million minimum capital requirement for banks to January 1, 2022;
  • Encouraging the restructuring of delinquent loans in accordance with the borrowers’ ability to repay;
  • Uncapping the monthly limit of electronic transactions and increasing the daily limit of transactions in electronic money to USD 2,500 (or its equivalent in CDF);
  • Suspending late payment penalties on overdue receivables during the Covid-19 crisis

Q: As a business, can I rely on any tax measures taken by the DRC government in response to the Covid-19 crisis?

A: Several tax measures have been taken by the DRC government in order to mitigate the economic effects of the Covid-19 crisis, including:

  • Exemption from all duties, taxes, levies and fees on the import and sale of pharmaceutical inputs and products, as well as medical materials and equipment linked to the pandemic for a period of 6 months;
  • Three months’ suspension of VAT on the imports and sales (as well as on the customs’ penalties for late clearance) of basic necessities or products for mass consumption;
  • Three months’ suspension of employee tax (IPR) on the remuneration and bonuses of civil servants;
  • Three months’ suspension of some local taxes on agricultural products;
  • Three months’ suspension of the tax on rent payable by companies;
  • Three months’ suspension of certain fiscal, parafiscal and economic controls;
  • Three months’ suspension of penalties in the event of delays in customs’ clearance of essential goods.

Q: As a business, What employment measures can I take in response to the Covid-19 crisis?

A: With regards to measures related to employment, the following applies:

  • Prohibition of mass dismissals based on lockdown measures: employment contracts cannot be terminated as such due to force majeure but can be suspended. In case of suspension, the “no work no pay” rule applies. Note that some costs, such as medical care, will still have to be borne by the employer during the period of suspension.
  • If the suspension lasts at least 2 months, the employment contract can be terminated for force majeure, with prior consent of the Labour Inspectorate. Note that such terminations will not be easy to obtain in practice;
  • Possibility to resort to staff rotations in the event of a proven drop in activity and minimum service.
  • Possibility for companies and employees to agree to a reduction of working hours and pay if full-time employment is no longer possible due to the Covid-19 crisis. The employee’s consent is necessary and the Labour Inspectorate must be informed.
  • Companies have a statutory obligation to ensure good health and safety conditions at the workplace. In the context of the Covid-19 crisis, specific measures have been taken by the authorities in this regard in order to strictly comply with WHO recommendations. Companies need to:
    • prioritise telework wherever possible, taking into account problems with power and internet connections;
    • ensure that hands are washed at the entrance of the company’s premises;
    • limit unnecessary visits by people from outside the company;
    • suspend non-essential business meetings;
    • avoid clustering in the workplaces and respect social distancing measures (at least 1m).
    • regularly disinfect means of transport directly provided by the company to employees;
    • display and enforce the usual hygiene measures.