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Introduction to the Country

"The fields are blooming into hope. The hearts are vibrant with confidence".



Government type
Mali is a Republic with unicameral parliament since 22nd September 1960. The President of the Republic is elected for a term of five years, renewable once. The President government represent the executive power.

The National Assembly holds the legislative power. It is represented by 147 deputies democratically elected for a 5 years term. The Highest juridical authority is the Supreme Court.

Mali is divided into 8 regions plus the district of Bamako placed under the authority of a Governor. Each regions of Mali has 9 prefectures administered by prefects. The prefectures are divided into communes, themselves divided into villages or quarters.

Legal system
Based on French civil law system, customary law, and decree; has not accepted compulsory ICJ jurisdiction.

Economy overview
Agricultural activities in Mali represent 70% of Mali's labour force and provide 42% of the GDP. Cotton and livestock make up 75%-80% of Mali's annual exports. Small-scale traditional farming dominates the agricultural sector, with subsistence farming (of cereals, primarily sorghum, pearl millet, and maize) on about 90% of the 14,000 km


Legal and Regulatory framework

Since 2000, operational management of the production, transport, distribution and sale of electricity has been awarded to private operators, under concessions granted by the State. The company Energie du Mali-Societe Anonyme (EDM-SA) was privatized in December 2000. Sixty percent (60%) of its share capital is held by a private consortium (SAUR INTERNATIONAL-IPS-WA) and 40% is held by the State. In 2005, the Malian government purchased the balance of shares in EDM. EDM-SA holds (up to 2010[1]), the exclusive right of wholesale purchase of electricity throughout the territory of Mali.

EDM-SA currently operates in 98 locations of the country with a total power produced of 175MW, in which 131MW is within the interconnected network and 44 MW is with stand-alone units. As of June 2009, 25% of the population was connected to EDM-SA.

 (a) Key enabling legislation

(i) List of key legislation and regulations

Uniform Act related to Commercial Companies and Economical Interest Grouping: Act adopted on 17th of April 1997 and published in the JO OHADA n*2 dated on 1st October 1997.

Law n* 91-048/ANRM dated on 26th February 1991 modified by the Law n*05-050 dated on 19th August 2005 related to the Investment Code. This Law sets out the benefits granted to all investors, based on amount of investment, business location and percentage of production exported.

Ordinance n*00-019/P-RM dated on 15th March 2000, related to the organisation of the electricity sector. This ordinance regulates the operational management of production, transport, distribution and sales of electricity run by private companies under State franchise.

Decree n*96-030/P-RM dated on 25th January 1996 modified by the decree n*97-203/P-RM dated on 27th June 1997 governing the administrative formalities of business development.

Decree n* 95-423/P-RM dated on 6th December 1995, amended by Decree n*05-553/P-RM dated on 27th December 2005 related to the detailed rules for implementing the Investment Code.

(ii) Overriding legislation and regulations

The Ordinance n*00-019/P-RM dated on 15th March 2000, related to the organisation of the electricity sector regulates directly the power project and the project company. This regulation sets up the conditions and terms of the generating licence.

 (b) Powers and capacity of the Government and Constitutional issues

(i) Governmental involvement

The authorities involved in a power project include: Ministry of Energy, Ministry of Environment, the Regulatory Commission of Electricity and Water (CREE) and the Territorial community where the project is implemented.

(ii) Powers of Government

The Malian Government has the power to grant an authorisation of power generating or to conclude a concession convention with the project company. The powers of the Malian Government on the project are set out in the Ordinance n*00-019/P-RM dated on 15th March 2000 (see above).

(iii) Powers in respect of the project

The Government's power vis-a-vis the Project and the project company are set out in the Ordinance n*00-019/P-RM dated on 15th March 2000 (see above).

It issues the licences and authorisations related to the project and approves the Investment Plan of the project.

(iv) Power to contract

The Government has the power to enter into the Concession to which it is party. The Ordinance n*00-019/P-RM dated on 15th March 2000 (see above) sets out the terms of the concession agreement. The Government is represented by the Ministry of Energy and the CREE which make the decision related to the power project.

(v) Legislative restrictions applicable to the giving of sovereign guarantees

There are no laws or regulations applicable to the giving of sovereign guarantees.

 (c) Regulator

(i) Overview of regulators and their powers

The CREE is the regulator with rights in respect of the power project or Project Company. Created by the Decree n*00-185/P-RM dated on 14th April 2000, the CREE has economic and financial oversight of the private operator in power generation. It is also responsible of all decisions taken related to the regulation, arbitration and enforcement as provided by laws and regulations concerning the sector of electricity. The CREE enforces the application of the tariff policy and regulates the public service of electricity.

(ii) Does the regulator typically enter into project documents relevant to the Project?

The CREE does not contract directly with the Project Company. However, the CREE sets up the guidelines for the tender of the award of the concession for generation, transmission, and distribution of electricity. It gives its approval in the pricing schedule and the terms of the purchasing agreement proposed by the private operator.

(iii) What is the form of licence issued and can it be amended?

The contractual regime between the Project Company and the Malian Government depends on the power generated by the relevant project:

An authorisation is applicable for a power project generating a minimum power of 50kW[2] and a maximum of 250kW of thermal production.

A concession is applicable for a project generating power in excess of 250kW of thermal production and all hydroelectric power generators.

(iv) Is the regulator regarded as being genuinely independent from government/the utility? How is the regulator funded?

The regulator is not independent from the Ministry of Energy and Water or the Ministry of Finance. It is funded by a budget fixed by the Council of Ministers with the approval of the Ministry of Finance and the Prime Minister.

 (d) Procurement

(i) Procurement or tender process

The process to award a project depends on the size of the Project and, in particular, the amount of power to be generated by the power project.

For projects generating between 50kW and up to 250kW the authorisation of production and distribution of electricity is granted by decision of the Minister of Energy. It is issued after a consultation of all the Ministries concerned with the power project, with the representative of the "collectivites locales" in the place of the installation of the project.

For projects generating over 350kW and for hydroelectric projects, that is, concessions, the Ministry of Energy is responsible for the tender and it approves applications with the CREE. The Ministry of Energy will have the draft concession approved by the Counsel of Ministers by Decree.

The Ministry of Environment approves the Environmental Impact Assessment and issues the Environmental permit to allow the power plant to operate.

(ii) Other specific procurement requirements

The Malian Investment Code has been established to create domestic employment and to give qualification training to national manpower. The Concession determines the conditions of procurement of labour, and equipment or machinery.

 (e) Power plants

(i) Is there a standard form of power purchase agreement?

There is no standard form of power purchase agreement used in Malian jurisdiction. Any power plant purchase agreement must be submitted and approved by the CREE.

(ii) Independent Power Projects: are there any IPPs in existence?

Please see “Legal and Regulatory Framework” section.

(iii) Merchant power: are there merchant power plants and if so, are they allowed to (or obliged to) sell power back to the grid?

Power plants owned by private investors are allowed to sell power back to the grid.

 (f) Consents required and authorisations from other ministries

(i) List of key licences, permits or consents

The Minister of Energy grants the Authorisation or Concession for power generation depending on the power produced by the project.

(ii) Are consents capable of being secured and are transferable to the lenders?

The rights awarded to the concessionaire may be pledged as security, individually or collectively, by the holder under the conditions set up by the regulations and the terms of the Concession.

Any agreement in which the concessionaire transfers to a third party the rights conferred by the concession is subject to prior authorisation of the contracting authority after the approval of the CREE.

(iii) Process of application for consents

See (f) (i) above

 (g) Competition law

Please contact us for further information.

 (h) Environmental regulations

Please contact us for further information.

Finance and Tax matters

(a) Financial assistance

(i) Does the concept of financial assistance exist

There are no prohibitions or restrictions on the ability of companies to guarantee and/or give security to support borrowings incurred to finance the direct or indirect acquisition of shares of a Project Company.

(b) Lending restrictions/banking monopolies

(i) Any restrictions applicable to the importation of capital by lenders?

The Regulation n*R09/98/CM/UEMOA dated 20 December 1998 relating to the financial affairs of the members of the Economic and Monetary Union of West Africa (UEMOA) with foreign entities allows the lenders to the Project to import capital into Mali.

(ii) Requirement for the lenders/security agent to be registered in the jurisdiction?

The Lenders/security agent are not required to be registered in the Mali.

(iii) Can foreign lenders lend into the jurisdiction?

Foreign lenders can lend into Mali.

(c) Restrictions relating to repatriation of dividends

(i) Are there any restrictions relating to repatriating dividends?

There are no restrictions relating to repatriating dividends.

(d) Convertibility

(i) Are there any restrictions on the convertibility of the jurisdiction's currency?

There are no restrictions on the convertibility of the CFA. The Law n* 95-005 regulates the financial arrangements relating to transactions between the Republic of Mali and foreign entities.

(e) Interest payments

(i) Are there any restrictions on the payment and compounding of interest? If so, does this also affect both local and foreign lenders?

There are no regulations which affect local or foreign commercial lenders.

(f) Tax

(i) Are there any withholding tax issues in relation to interest payments and fees to foreign lenders or payments received under any agreements?

Payment of interest may be made free of withholding tax.

(ii) List of double taxation treaties.

(A) Mali has ratified double taxation treaties as follows:

(B) Fiscal Convention with Tunisia (28th April 2000);

(C) Fiscal Convention with France (22nd September 1972);

(D) Double taxation Convention with Algeria (31st January 1999);

(E) Double taxation Convention with Russia (25th June 1996);

(F) Double taxation Convention with Senegal (19th November 1972).

(iii) Lender risks in respect of tax liabilities/tax domiciliation as a result of providing debt and/or taking/enforcing security interests

Please consider with local counsel.

(iv) Can loan repayment / enforcement proceeds be treated negatively from a tax perspective for the lenders?

Please consider with local counsel.

(g) Stamping costs

(i) Details of stamp duty costs

Stamp duty applies on security documents on a sliding scale depending on the amount secured.

Security, Enforcement and Insolvency

(a) Overview of security regime

(i) Nature of security: can a security interest be obtained over a company's assets, e.g.:

  • Accounts receivable (book debts): Pledge
  • Inventory (stock in trade): Pledge
  • Shares of a company (issued and authorised): Pledge
  • Equipment: Pledge
  • Real property: Mortgage
  • Insurances: Pledge
  • Project contracts: Cession or Pledge

(ii) Can shares of a project company validly be pledged and enforced under an English law share charge?

Shares of commercial company are validly pledged and enforced under the Uniform Act of OHADA (Organization for the Harmonization of Business Law in Africa) on security.

(iii) Can a company grant a security interest in order to secure its obligations (i) as a borrower under a credit facility, and (ii) as a guarantor of the obligations of other borrowers and/or guarantors of obligations under a credit facility?

Yes. Enforceability and priority are subject to registration.

(iv) If the borrowings to be secured are under a revolving credit facility, are there any special priority or other concerns?

There is no special legislation relating to an revolving credit facilities.[3]

(v) Can the relevant security interests be granted to a security agent or trustee on behalf of the lenders from time to time?

The Uniform Act of OHADA on security does not refer to the concept of security trustee.[4]

(vi) Please indicate the claims that would have priority over the relevant security interests.

Priority following the liquidation of immovable property is as follow (article 148 of the Uniform Act on Security):

(A) costs of the court and legal process

(B) unpaid salary

(C) mortgages

(D) general privileges subject to publicity

(E) general privileges not subject to publicity

(F) unsecured creditors with enforceable title

Priority following the liquidation of the movable property is as follows (article 149 of the Uniform Act on Security):

(A) costs of the court and legal process

(B) expenses incurred to hold the assests of the debtor

(C) unpaid salary

(D) pledges

(E) other privileges subject to publicity

(F) special privileges

(G) general privileges not subject to publicity

(H) unsecured creditors with enforceable title

(vii) Is there a public security registry?

The commercial registry can be searched for security information.

(viii) Formalities in respect of security creation:

(A) Statutory perfection requirements;

Security interest must be made by deed or by private act duly recorded. This act is effective only if it is registered at the register of trade and credit (art 45-65-119 on security)

(B) Any other formalities.

Pledging of shares is not possible without the approval of the shareholders representing 75% +1 of the issued share capital.

(C) Steps for perfection and length of time taken

Provisional registration and enrolment must be taken respectively, following the decision authorising the pledge.

Registration retains the right of creditor for 5 years. After which a renewal must be done.[5]

(D) Any significant financial costs or significant time delays required to create and perfect the relevant security interest?

Stamp duty and notarial fees are charged ad valorem which can be a significant.

(b) Insolvency and enforcement regime

(i) Is there a court or similar register that can be searched in respect of proceedings and insolvency actions ?

Yes, the commercial registry and the court records may be searched.

(ii) Summary of the different options for an insolvency related process.

Insolvency procedures are set out in the OHADA Uniform Act for the simplified procedures for debt recovery.

(iii) Are summary or expedited proceedings available?

No special provision for these proceedings.

(iv) Are any governmental or other consents required in connection with:

(A) the enforcement of a security interest in shares;

Formalities are prescribed by the Uniform Act of OHADA related to the procedures of debt recovery.

(B) The enforcement of a security interest in other assets; or

Formalities are prescribed the Uniform Act of OHADA related to the procedures of debt recovery.

(C) The enforcement of a guarantee (sovereign or otherwise)?

Formalities are prescribed by the Uniform Act of OHADA related to the procedures of debt recovery.

(v) Do lenders inherit all environmental liabilities when they become owner of the shares upon enforcement (or at any other time)?

Lenders inherit all environmental liabilities when they become owner of the shares.

(vi) Can security interests be enforced by both private sale and public auction, and is it necessary to appoint a court or other official to carry out the enforcement?

The Uniform Act on organisation of simplified procedures for debt recovery lists the steps to follow when enforcing security.[6]

Corporate, Insurance and Employment matters

(a) Corporate vehicle

(i) Project company incorporation:

(A) Type of corporate vehicle

The legal form of the company for the project company is a "Societe Anonyme" (SA).

Its key features are:

  • Can be managed by one person or associated entity.
  • An SA may be administered by a Board of Directors from 3 to 12 members with a Managing Director.
  • An SA may also be administered by a single administrator, with combined power of Managing Director and Board Chairman.
  • Shares can be transferred, sold, or assigned by private treaty

(B) Issues relating to thin capitalisation

Use of shareholder loans to finance project ahead of capital is discouraged. [7]

(C) Requirement to have indigenous shareholdings

The Malian legislation does not require foreign investors to be partner with the Malian State or a Malian Entity. Foreign investor may own 100 % of shares.

(I) Thin capitalisation requirements

The minimum capital for S.A is CFA 10,000,000 (approx USD 22,000).

(II) Can a limited liability company be established?

A limited liability company can be established as a "Societe a Responsabilite Limitee" (SARL) or as a "Societe Anonyme" (SA).

(III) Is it possible to use a foreign company or a branch of a foreign company to act as project company?

A foreign company can operate in Mali by establishing a branch.

(D) Estimated timescale for incorporation in the country. Are there any specific fees or other costs payable to governmental authorities in respect of incorporation?

Since the creation of the new one-stop centre, the estimated timescale for incorporation in Mali is 30 days.

The fees payable to governmental authorities to create an SA is CFA 8,500.

(b) General corporate issues

(i) Is a private company free to lend and/or issue guarantees?


(ii) Are there any restrictions on dividend distribution?

The distribution of the dividend must be made within a maximum period of 9 months after the close of the annual accounting period.

Except, in the case of a reduce capital, no distribution can be made for shareholders, if the equity become, following this distribution, lower than the amount of the capital.

The procedure of payment of dividend is fixed by general assembly.

(c) Insurance

(i) Mandatory insurance: are there any insurances which the project company or the Project is required to have by law (or regulations or similar)?

[ ][8]

(ii) Is there any minimum requirement to place the insurance with local insurers or any other similar restrictions? If so, can reinsurance be lawfully placed internationally?

[ ][9]

(iii) Are there any restrictions in respect of granting security rights over the insurances or reinsurances?

[ ][10]

(d) Employment

(i) Legislative/regulatory issues: is there any legislation or regulation impacting on foreign employees, in particular the conditions relating to work and residence permits? Please give an indication of the process and costs in relation to obtaining work and residence permits.

Yes. Preference must be given to Malian employees unless suitably qualified personnel are not available.[11]

(ii) Foreign restrictions: are there any restrictions that apply to foreign employees and foreign contractors/subcontractors and if so what do they need to do in order to comply with local legislation?

See above at d(ii).


(a) Land registry: is there a land registry (or similar) in the country that can be searched to confirm whether a project company has granted of any mortgage, charge, option assignment, lien or other encumbrance over the whole or part of the properties or assets of a company?

All communes of Mali have a "cadastre" (a land title map kept by the local land registry office) that contains all the information relating to land. (Article 49 of the land and Domaines code). Information related to land can also be found in the Land Book or "Livre foncier" (kept by each local land registry office).

(b) Landlord's rights: please indicate whether there are any rights which accrue to the landlord (or the government or any other bodies) that may override the terms of a land lease or threaten the rights of a project company particularly any right of repossession or acquisition.

In cases of public interest (where legally established), the Government may invalidate the terms of a lease.

(c) Direct agreement: are you aware as to whether a direct agreement in respect of a lease has been previously been provided to lenders on other transactions?

It is not certain that a direct agreement in respect of a lease will be provided to lenders on transactions.

(d) Forfeiture rights: do relief from forfeiture rights exist and would the lenders be entitled to rely on such rights?

None as known.

(e) Is there any additional legislation governing property rights?

No other relevant laws.

(f) Are there any formalities with which lenders need to comply when enforcing security over land?

Enforcement depends on the nature of the right to be enforced and the security held (mortgage, right of way etc). These are enforceable before the court.

International law and arbitration

(a) Supra-national treaties

(i) Please list the Bilateral Investment Treaties to which the country is party.

The Malian government has signed several Bilateral Investment Treaties including:

  • Convention signed with the Kingdom of the Netherlands on 13th July 2003. The validity period is 15 years with automatic renewal for a period of ten years.
  • Convention signed with the Republic of Chad on 18th May 2001. The validity period is 10 years with automatic renewal for a period of ten years.
  • Convention signed with the Republic of Guinea on 13th July 2003 for a period of ten years, automatically renewable for further periods of five years.
  • Convention signed with the Federal Islamic Republic of Comoros on 18th May 2001 or a term of 10 years. Then remain in force until terminated by one of the party.
  • Convention signed with Benin signed on 18th May 2001 for a period of ten years automatically renewed.
  • Convention signed with Cameroon on 18th May 2001 for a period of 10 years automatically renewed for a further period of 10 years.
  • Convention signed with the Democratic People's Republic of Korea on 11th October 1999. Its validity is 10 years, automatically renewable for the same period.
  • Convention signed with Qatar on 1st December 1998 for a period of 10 years, automatically renewable.
  • Convention signed with Egypt on 9th March 1998 for a period of 10 years, automatically renewable for the same period.
  • Convention signed with Algeria on 11th July 1996 for a period of 10 years, automatically renewable.
  • Convention signed with South Africa on 4th March 1995 for a period of 10 years, automatically renewable.
  • Convention to promote and guarantee investment signed with Libya, on 30th August for an unlimited period, until it is terminated by one of the parties.
  • Convention with Tunisia signed on 11th July 1986 for a period of 10 years, automatically renewable.
  • Convention signed with the Federal Republic of Germany on 28th June 1977 for a period of 10 years and later extended indefinitely unless one of the Contracting Parties revokes it.

(ii) Please confirm whether the country is a signatory to the Energy Charter Treaty.[12]

(b) Arbitration

(i) Requirements and restrictions applicable to the choice of arbitration roles and place of arbitration

The OHADA Uniform Act of Arbitration regulations adopted on 11th March 1999 sets up the requirements and restrictions applicable to the choice of arbitration roles and place of arbitration.

(ii) Are foreign arbitral awards / decisions are enforceable in the country (i.e. is the country a party to the New York Convention on the Recognition of Foreign Arbitral Awards (the "Convention")?

The New York Convention of 1958 was ratified on 8th September 1994 and entered into force on 7th December 1994.

Renewable Energy

(a) Has the country enacted any legislation specifically designed to promote and enable the development of renewable energy projects?

Mali has not enacted any legislation specifically designed to promote the development of renewable energy projects.

(b) Is the country is a signatory to the Kyoto Protocol?

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