2023 Investment Climate Statements: Cameroon

Policies Towards Foreign Direct Investment

Cameroon has placed the creation of a conducive business environment for attracting FDI at the heart of its development strategy, and views FDI as a means to mobilize financing for its National Development Strategy and generate technology spillovers necessary for the nation’s industrialization and economic development. Law N° 2013/004 of April 18, 2013, established incentives for private investment in Cameroon. However, business associations assert that the law pits new entrants against already established businesses. They cite a 10-year tax waiver only applicable to new businesses and overly general incentives rather than targeting specific sectors. Moreover, the law does not facilitate technology transfer clauses, which is an objective of the National Development Strategy.

Decree No. 2005-310 of September 1, 2005, created an Investment Promotion Agency  (CIPA), which became effective in 2010 following appointment of its executives. CIPA fosters an enabling environment for investments in Cameroon by: (i) promoting Cameroon’s brand image abroad; (ii) participating in the improvement of the Cameroon investment environment; (iii) proposing measures likely to attract investors to Cameroon as well as those likely to improve the implementation of the investment and other sectoral codes; and (iv) hosting a database of projects available to investors. CIPA also enters into joint ventures and public-private partnerships with other government and private entities, as necessary, with the objective of improving the business environment. CIPA offers investment incentives covering existing and emerging economic sectors. The agency also serves as a one-stop-shop, facilitating business through the assistance it provides to foreign and domestic investors. It processes application files for approval in compliance with its investment charter and assists in the alignment of projects with the general tax code. It can support potential foreign investors for visa applications. CIPA also monitors the implementation of commitments made by approved companies.

The government maintains dialogue with business associations such as the Groupement Inter-Patronal du Cameroun (GICAM), Enterprise Cameroun (ECAM) (GICAM and ECAM merged with in March 2022 to create a larger association) and Mouvement des Enterprise du Cameroon (MECAM)through the Cameroon Business Forum, which is sponsored by the World Bank. The government convenes the Cameroon Business Forum annually for an inclusive dialogue in key sectors of the economy and makes recommendations to improve the business landscape. The government also maintains dialogue with syndicates in all the sectors to find common ground on specific issues that would otherwise disrupt normal economic activity.
Limits on Foreign Control and Right to Private Ownership and Establishment

Apart from the national defense and security areas, there are no sector-specific restrictions, limitations, or requirements applied to foreign ownership and control. Despite an active government presence in most sectors of the economy, private entities – both domestic and foreign – can create and own businesses that engage in all forms of legal remunerative activities. They can also enter joint ventures and public-private partnerships with the government.

Law N°2002/004 of April 19, 2002, on the Charter of Investments in the Republic of Cameroon, guarantees to any individual or corporate entity with established economic activity or wishing to establish an economic activity in Cameroon the freedom to repatriate foreign capital invested and profits made by the exploitation, as well as repatriation of salary savings made by expatriate staff. The same law, however, requires that foreign exchange and capital transfers be done in respect of the rules of the Central African Economic and Monetary Union (CEMAC), which places restrictions on the repatriation of foreign capital. Regulation N°02/18/CEMAC/CAMU/CM of December 2l, 2018, regulating foreign exchange in the CEMAC region, specifies that the import, issuance, advertisement, and sale of foreign currency for amounts exceeding CFAF 50 million are subject to BEAC authorization. Although there is no specific clause that prohibits transactions of any amount, the system of authorizations and associated foreign exchange controls indirectly affects cross-border transaction amounts.

Cameroon has no laws or regulations that expressly prohibit investment, equity caps, mandatory domestic joint venture partners, licensing restrictions, or mandatory intellectual property/technology transfer requirements. Cameroon has a screening process, which is applicable to all domestic and foreign investments.  This screening process ensures that investors meet the criteria, such as employment and export quantities, to qualify for private investment incentives.

Other Investment Policy Reviews

The IMF completed the Third Review  of its three-year, $689.5 million hybrid Extended Credit Facility and Extended Fund Facility arrangement in February 2023 and approved a further disbursement of $73.3 million. While macroeconomic performance is satisfactory, and efforts to promote good governance and transparency are advancing, progress on structural reforms is slow.

In December 2022, the International Finance Corporation (IFC) released the report of the Cameroon Country Private Sector Diagnostic (CPSD) that examines opportunities and constraints and makes recommendations that could increase private investment, contribute to growth, and support better living conditions for Cameroonians. The CPSD recommends the undertaking of reforms in energy, state-owned enterprise governance, and public-private partnership sectors. The CPSD maintains these reforms would increase private investments and improve access to essential physical and digital infrastructure. The CPSD also highlights the benefits of diversification and suggests a focus on select value chains such as cocoa and cereals. Concerning the urban economy, the report suggests enhancing investments in education, housing infrastructure, and retail, where demand is high. The full report can be read here .

GICAM, Cameroon’s largest private business association, noted that to significantly improve the business environment and impact the development of investments the government should focus reforms in four main areas: (i) real estate/land tenure management; (ii) energy development, especially green energy; (iii) telecommunications enhancement, and (iv) review of the tax base – using income/profit as tax base instead of turnover.

In a December 2022 report , the Nkafu Policy Institute, a Cameroonian think tank, examined the economic impacts of the 2023 fiscal measures that increased taxes and stamp duties. In its 2023 budget, the government of Cameroon significantly reduced fuel subsidies and increased stamp duties on administrative procedures; this was followed in February 2023 by a 24% average fuel price increase. The report notes that these measures would affect the competitiveness of the economy by: (i) increasing the prices of the consumer goods due to increased transport fares; and (ii) tightening of conditions for running and formalizing businesses or accessing land. These measures would slow down the efficient operation of transport networks, the development of the private sector and, by extension, economic growth.

Business Facilitation

In Cameroon, anyone, national or foreign, is free to start and run a business. Entrepreneurs obtain a unique tax identification number issued by the Directorate General of Taxation, known as a Unique Identification Number (UIN).

While official business services are available, most companies including those from the United States operating in, or attempting to enter, the Cameroonian market have a local presence as operating a business requires frequent face-to-face interactions with public servants.

Government procurement is a long and arduous process in Cameroon, and understanding and enforcing legal agreements is painstaking work. In 2018, the government created an online procurement management system, Cameroon On-Line E-Procurement System  (COLEPS). The e-procurement portal is an electronic procurement management tool for companies. It is part of the electronic management of purchases which includes actions for both upstream – selecting suppliers (e-sourcing), and downstream – placing and monitoring orders. Orders are placed electronically in catalogues. The online platform is now operational. Procurement related laws, decrees, orders, and other regulatory materials are available on this platform. The system now has information on procurement programming, involving, among others, budgeted projects, tender notices, and biddings. However, current laws does not compel use of the system to manage procurements and it is not widely used by government offices.

According to the World Bank, it takes 14 procedures and 82 days to establish a foreign-owned limited liability company in Douala, Cameroon’s largest city and economic capital. This process is longer and more complex than regional and global averages. For foreign investors, a declaration of foreign investment to the Ministry of Finance is mandatory 30 days prior to the beginning of operations. In addition, if the company wants to engage in international trade, registration in the importers’ file is required to obtain an automated customs systems number (Système Douanier Automatisé, or “sydonia”). This number facilitates the entry and exit of goods produced by the company. The authentication of the parent company’s documentation abroad is required only to establish a subsidiary. Foreign-owned resident companies that wish to maintain foreign currency bank accounts must obtain prior approval. The Minister of Finance issues such authorization, which is subject to approval from the Bank of Central African States (BEAC) as per Section 24 of the exchange control regulations. This approval takes on average 38 days to obtain. There is a minimum paid-in capital requirement of CFA 1,000,000 (~$1,800) for establishing LLCs.

In Cameroon, business registration is most often manual, although the Ministry of Small and Medium-Sized Enterprises launched an electronic registration portal designed to automate the process at https://cameroun.eregistrations.org/ . Due to internet access challenges, the website is not always operational. To manually register, entrepreneurs must go to a Ministry of Small and Medium Sized Enterprises regional center for the creation of enterprises, which can complete the registration procedure within one week.

In addition, to facilitate cross-border investments, a single window (one-stop shop) for foreign trade transactions ( GUCE ) has been established. Through this window, all cross-border transactions are registered in an online form and information is sent to all participating parties including technical ministries. Each transaction has a unique payment, a unique form for entering data, and a system for informing participating parties. The system is still being deployed and has yet to become fully operational.

Outward Investment

The Cameroonian government does not promote or incentivize outward investment, nor does it restrict domestic investors from investing abroad.

Transparency of the Regulatory System

Cameroon’s laws are consistent with international business and legal norms. Cameroon’s legal architecture is made up of national, regional CEMAC, and supra-national regulations, most of which are applicable to domestic and foreign businesses. Weak implementation and investigative capacity, a lack of understanding of international business practices, and corruption in the judiciary limit the effectiveness of the rule of law. In many circumstances, judicial loopholes persist, leading to arbitrary interpretations of the texts.

Some government ministries, though not all, consult with public and private sector organizations through targeted outreach with stakeholders, such as business associations or other groups. There is no formal process for such consultations. Ministries do not report the results of consultations, but there is no evidence that such processes disadvantage U.S. or other foreign investors.

Cameroon’s National Assembly and Senate pass laws. The Executive proposes bills and then executes laws. Though there is technically a separation of powers, the Presidency is the supreme rule-making and regulatory authority. Decentralized institutions in the regions and municipalities have little additional regulatory authority. Draft bills and regulations are not made available for public comment. The website for the Office of the Prime Minister (www.spm.gov.cm) contains PDF versions of most new regulatory actions published in the Cameroon Tribune, the country’s newspaper of record.

Ministries and regulatory agencies do not have a list of anticipated regulatory changes or proposals intended to be adopted/implemented within a specified period. Ministries do not have a legal obligation to publish the text of proposed regulations before their enactment. There is no period set by law for the text of the proposed regulations to be publicly available. There is no specialized government body tasked with reviewing and monitoring regulatory impact assessments conducted by other individual agencies or government bodies.

Cameroon has administrative courts that specialize in the application and enforcement of public laws. From a strictly legal perspective, the Supreme Court has oversight on enforcement mechanisms, but a lack of separation of powers prevents the judiciary from independently carrying out its responsibilities. There have been no new regulatory or enforcement reforms announced since the 2022 Investment Climate Statement.

Cameroon does not meet the minimum standards of fiscal transparency. This is partly because many of the state-owned enterprises do not have public accounts. Companies that are listed or aspire to be listed on the Central African Stock Exchange (CASE) have more stringent transparency requirements. There are only four publicly listed companies on the CASE. All four use the Organization for the Harmonization of Business Law in Africa (OHADA) accounting system, which does not align completely with International Financial Reporting Standards (IFRS) or Generally Accepted Accounting Principles (GAAP). Cameroon is a member of CEMAC and is thus subject to its regulations, though implementation remains weak. CEMAC’s central bank, the Bank of Central African States (BEAC), controls monetary policy and is the de facto finance sector regulator, in coordination with the Ministry of Finance.

The National Institute of Statistics (INS) conducts surveys and produces statistics, which are meant to inform policy decisions. Some of these statistics are cited in government documents when ministries are drafting legislative proposals or during parliamentary debates. Quantitative analysis conducted by the INS has often been used by multilateral lenders such as the IMF, the World Bank, and the African Development Bank. However, empirical evaluation and data-driven assessments of the impact of new and existing regulations are limited.

Similarly, public comments are not the main drivers of regulations. However, some consultations take place for the national budget, which is produced each year, but there is little oversight to ensure adherence to the document.

The government does not require companies to have environmental, social, or governance disclosures.

International Regulatory Considerations

Cameroon is a CEMAC member state. CEMAC regulations supersede those of individual members, though areas such as the free movement of people, goods, and services are not respected by some states. Recent reforms by CEMAC’s central bank, BEAC, have met stiff resistance and delays in their application by individual member states, including Cameroon.

The government requires use of OHADA accounting standards, which are used by 14 African nations. No other norms or standards are referenced in the country’s regulatory system.

Cameroon joined the World Trade Organization (WTO) on December 13, 1995, and was previously a member of the General Agreement on Taxes and Trade. Cameroon did not notify all draft technical regulations to the WTO Committee on Technical Barriers to Trade (TBT) in 2020 and submitted eight notifications between 1995 and 2020.

Legal System and Judicial Independence

The Cameroonian legal system is a legacy of French (Civil Law), German (Codified Laws), English (Common Law), and domestic national customs, which vary for each ethnic group. The government wants to harmonize these different legal traditions to equip Cameroon with laws that are applicable across the country and to reduce the need to navigate different legal opinions. This project, however, is being met with stiff resistance from English-speaking lawyers, who believe that the initiative will undermine the English system to which they are accustomed.

In terms of standards, Cameroon’s commercial legal system follows the OHADA rules, which are neither completely aligned with IFRS standards nor with GAAP principles.  Enforcement is weak, partly because of lack of capacity. There are not enough specialized judges in the commercial and economic fields. Consequently, poor enforcement of laws and accounting standards tend to create confusion for foreign investors. Despite efforts to align OHADA standards to international norms, government accounting regulations remain obsolete in the context of rapid developments in international finance and capital markets. To circumvent the problem, U.S. enterprises and investors often maintain two sets of accounting records, one in accordance with U.S. Generally Accepted Accounting Principles (GAAP) or suitable international standards, and another set to address the OHADA standards and government reporting requirements.

Arbitration is becoming the solution of choice to solve business disputes in Cameroon.  Since OHADA is a supra-national law, Cameroon is bound by its decisions. In OHADA, regulations and enforcement of actions are appealable, and they can also be adjudicated in the national court system. In Cameroon, businesses mostly use the GICAM and Abidjan Arbitration Councils.

Laws and Regulations on Foreign Direct Investment

Foreign direct investments are governed by Law No. 2013/004 of April 18, 2013, which defines incentives for private investment in Cameroon, while proposing generic and special incentives and affirming the government’s responsibilities towards private investors.  The law applies to both domestic and foreign investors.  Additional laws and regulations that refer to specific economic sectors are available on the website of the Ministry of Finance ( http://www.minfi.gov.cm/index.php/en/documents ).

The  2023 finance law  is the newest legal instrument on public finance to have been published in the past year. The 2023 finance law reduced fuel subsidies, increased stamp duties, provided tax waivers for agricultural investments, while maintaining some existing exonerations, notably on value-added taxes and life insurance savings.

Competition and Antitrust Laws

The National Competition Commission handles anti-competition and anti-trust disputes. In some cases, the regulator of a specific economic sector can play the anti-trust role. State-owned enterprises tend to have quasi-monopoly or monopsony status in their markets.

Expropriation and Compensation

Decree N°.85-9 of July 4, 1985, and the subsequent implementation of Decree N°.87-1872 of December 16, 1987, outline the procedures governing expropriation for public purposes and conditions for compensation. Some of the provisions of these legal texts were repealed by Instruction N°005/I/Y.25/MINDAF/D220 of December 29, 2005. Essentially, for the public interest, the state may expropriate privately-owned land, with compensation based on the provisions of Articles 2 and 3 of Decree N°.87-1872 of December 16, 1987, above. The laws also explain the formalities to be observed within the context of the procedure, both at the central and local levels.

In recent years, the government of Cameroon has expropriated large infrastructure road and hydroelectric dam projects. The government has a compensation process in place to meet the losses of those affected by such decisions.

Compensation for expropriation generally follows a due process, albeit with prolonged delays. There are no cases of indirect expropriation, confiscatory tax regimes, or regulatory actions that deprive investors of substantial economic benefits from their investments. However, serious allegations of corruption have plagued compensation procedures over the last decade. These incidents, often carried out by civil servants, have undermined trust in the process.

Dispute Settlement

ICSID Convention and New York Convention  

Cameroon ratified the “International Centre for Settlement of Investment Disputes” (ICSID) Convention on January 3, 1967, and the New York Convention on February 19, 1988. There is no specific domestic legislation providing for enforcement under the 1958 New York Convention or for the enforcement of awards under the ICSID Convention.

Investor-State Dispute Settlement  

The OHADA  signatory nations adopted a uniform act on arbitration (the Uniform Act) on March 11, 1999. The Uniform Act sets out basic rules applicable to any arbitration, where the seat of arbitration is in an OHADA member state. The Uniform Act is based on the United Nations Commission on International Trade Law (UNCITRAL) as a model. It supersedes member states’ national laws on arbitration. Cameroon’s arbitration law is contained in its code of civil and commercial procedure in the third volume, Articles 576 to 601.

Cameroon has a Bilateral Investment Treaty (BIT) with the United States. There have been no claims under the BIT since it came into force in 1989. While there have been disputes between Cameroonian partners and U.S. companies, few have risen to the level of requiring arbitration.

Local courts may recognize foreign arbitral awards issued against the government, but such awards might not be enforced, or implemented with significant delays, due to political influence and corruption. Several such awards against state-owned companies have not been enforced. In general, foreign investors complain more about administrative harassment or bottlenecks, and less about extrajudicial actions.

International Commercial Arbitration and Foreign Courts  

The OHADA  system serves both as domestic and primary reference legislation for alternative dispute resolution. GICAM has an arbitration center based in Douala. In principle, local courts have the power to recognize and enforce foreign arbitral awards issued against the government. OHADA standards prevail over domestic laws. An international arbitration award can prevail especially if operating through the OHADA framework. The Common Court of Justice and Arbitration (CCJA) enforced under OHADA is both an arbitration institution and a judicial court, with jurisdiction overall OHADA states.

Judicial processes are bureaucratic, expensive, and lengthy. This is true even for domestic and state-owned companies, and more so for their foreign competitors, which suffer the effect of the weaknesses of the legal system and are not guaranteed fair treatment in case of dispute.

Bankruptcy Regulations

Bankruptcy collection procedures and measures of execution are governed by the OHADA Insolvency Law , which establishes the right of creditors, the equity of shareholders, and other types of liabilities. Bankruptcy is not criminalized unless it can be proven that it is a deliberate collusion to avoid taxes or mislead investors. In bankruptcy situations, it takes 2.8 years on average and costs 33.5 percent of the debtor’s estate, with the most likely outcome being that the company will be sold piecemeal. The average recovery rate is 15.8 cents on the dollar.

Investment Incentives

Cameroon’s investment incentives remain in place. The 2013 investment law lists several types of investment incentives for investors and specifies the conditions that they must meet to benefit from those incentives. This law specifies incentives available to Cameroonian and foreign corporate entities, whether established in Cameroon, conducting business therein, or holding shares in Cameroonian companies, to encourage private investment and boost national production. For example, during the establishment phase (which cannot exceed five years), the code provides for exemptions from VAT and duties on key services/assets (including an exemption from stamp duties on the lease of immovable property). During the operation phase (which cannot exceed 10 years), further exemptions from, or reductions of, other taxes (including a corporate tax), duties (such as a stamp duty on loans), and other fees are granted. Overall, the law seeks to facilitate, promote, and attract productive investment to develop activities geared towards strong, sustainable, and shared economic growth as well as job creation. In a context where businesses must navigate between national and regional incentives, U.S. companies and investors would be well-advised to seek local and regional expertise if they plan to operate in the CEMAC region.

Common incentives are granted to investors during the establishment and operation phases. During the operation phase, which may not exceed 10 years, the investor may enjoy exemptions from or reductions of payment of several taxes, duties, and other fees including corporate tax, tax on profit, and stamp duties on loans. In addition, any investor may benefit from a tax credit provided he or she meets one of the following criteria: (1) employs at least five graduates each year, (2) combats pollution, or (3) develops public interest activities in rural areas.

BEAC foreign exchange regulations govern how investors in Cameroon open foreign currency accounts and carry out transactions on such accounts. The regulations also stipulate how funds are transferred abroad. Notwithstanding BEAC regulations, the investor shall enjoy the following benefits during establishment phase, which may not exceed five years, with effect from the date of issuance of the approval:

• Exemption from stamp duty on establishment or capital increase;
• Exemption from stamp duty if immovable property used exclusively for professional purposes and that is part of an integral part of the investment program;
• Exemption from transfer taxes on the acquisition of immovable property, land, and buildings essential for the implementation of the investment program;
• Exemption from stamp duties on contracts for the supply of equipment and construction of buildings and installations that are essential for the implementation of their investment program;
• Full deduction of technical assistance fees in proportion to the amount of the investment made, calculated on the basis of the total amount of the investment;
• Exemption from VAT on the provision of services related to the execution of the project and obtained from abroad;
• Exemption from stamp duty on concession contracts;
• Exemption from business license tax;
• Exemption from taxes and duties on all equipment and materials related to the investment program;
• Exemption from VAT on the importation of equipment and materials;
• Immediate removal of equipment and material related investment program during clearance operations;
• The right to freely keep abroad dividends and proceeds of any kind from capital invested, as well as proceeds from the liquidation or sale of their assets;
• The right to directly pay abroad non-resident suppliers of goods and services essential for conduct of business; and,
• Free transfer of dividends and proceeds from the sale of shares in case of disinvestment.

With respect to foreign staff employed by the investor and resident in Cameroon, they shall enjoy free conversion and free transfer to their country of origin of all or part of amounts due them, subject to prior payment of various taxes and social security contributions to which they are liable in compliance with the regulations in force. The Regulation N°02/18/CEMAC/CAMU/CM of December 21, 2023, requires the presentation of the relevant supporting documents. Finally, the government shall institute facilities necessary for the establishment of a specific visa and a reception counter at all airports throughout the national territory for investors, subject to their presentation of a formal invitation from the body in charge of investment promotion of small and medium-sized enterprises. There are additional incentives in priority economic sectors. In addition to the above-mentioned incentives, specific incentives may be provided to enterprises that carry out investments that contribute to the attainment of the following priority objectives:

• Development of agriculture, fisheries, livestock, and plant, animal or fishery product packaging activities;
• Development of tourism and leisure facilities, social economy, and handicrafts;
• Development of housing, including social housing;
• Promotion of agroindustry, manufacturing industries, industry, construction materials, iron and steel industry, construction, maritime and navigation activities;
• Development of energy and water supply; encouragement of regional development and decentralization;
• The fight against pollution and environmental protection;
• Promotion and transfer of innovative technologies and research and development;
• Promotion of exports; and,
• Promotion of employment and vocational training.

The government does not offer incentives for businesses owned by underrepresented investors such as women.

Foreign Trade Zones/Free Ports/Trade Facilitation

Foreign Trade Zones (FTZ) are demarcated and fenced geographic areas, with controlled access, where some standard trade barriers, tariffs, quotas, or other bureaucratic requirements are lifted or lowered to attract investments. Cameroon passed a special law instituting FTZs in 1990. An Industrial Free Zone (IFZ) is a type of FTZ in Cameroon. Applications for an authorization to establish an IFZ are submitted to the National Office for Industrial Free Zones. The Minister of Mines, Industry, and Technological Development grants authorization to establish an IFZ. To qualify for industrial free zone status, a company must export 80 percent of its products. The status of FTZs has not changed since the last reporting period.  Additionally, Law No. 2013/11 of December16, 2013 defines an economic zone as an area made up of one or more geographical areas that are serviced, developed, and equipped with infrastructure, with a view to enabling the entities located there to produce goods and services in optimal conditions. Decree No. 2019/195 of April 17, 2019, also establishes the modalities for the creation and management of economic zones in Cameroon. The ports of Douala and Kribi have economic zones.

The free trade zones are only for the use of companies that produce goods and provide services meant exclusively for export. There are many advantages for such companies , including: exemption from all licenses, authorization or quota limitation for both export and import, the possibility of being able to open a foreign currency account, no restrictions on sales operations, purchase of foreign currency, right to transfer profits abroad (25% has to be re-invested in Cameroon), tax and duty exemption for a period of 10 years from the beginning of operations and taxation at a general rate of 15% on profits starting the 11th year.

Performance and Data Localization Requirements

The government of Cameroon encourages investors to create jobs and employ local labor. There are no compulsory or legal requirements on senior management and boards of directors either, although local managers can facilitate the understanding of the domestic business environment. Prospective investors and their employees can travel to Cameroon on standard international visas. The fees may vary per country of application. Once they settle in Cameroon, they can apply for long-term residence permits. The government of Cameroon applies the visa reciprocity rules to a limited extent, but companies have in the past complained about the difficulty of obtaining work permits or the fact that work visas expire after six months and frequently are single entry. Applications for longer term work permits can be included in residency work permit applications, which involve more complicated application procedures.

The government does not impose conditions on permission to invest in Cameroon. It gives incentives to investors to transform local raw materials, goods, and services in their production or their projects. There is no “forced localization” policy. Enforcement procedures for performance requirements are not yet standardized, but the government generally develops terms of reference on a case-by-case basis for contract performance. The government has not stated intentions to maintain, increase, or decrease performance requirements.

Investment incentives, described above, are available to both domestic and foreign investors.  Foreign information technology providers are not required to turn over source code and/or provide access to encryption, but they can be required to provide them in cases of cybercrime under the national cybercrime law. The U.S. Embassy in Yaoundé is unaware of any measures designed to prevent or impede companies from freely transmitting customer or other business-related data outside of Cameroon.

Real Property

Property rights are recognized by law, but Cameroon’s weak judiciary makes enforcement sporadic. For mortgage transactions between two private parties, a proper contract is required for the agreement to be binding and enforceable in the courts. Liens must be recorded in the contract. A registry of land title exists in Cameroon. The land rights of indigenous peoples, tribes, and farmers are recognized in the Constitution. Existing legislation does not discriminate against foreign landowners.

Records from the Ministry of State Property and Land Tenure indicate that land registration rates have not significantly increased since colonial times. Between 1884 and 2005, only 125,000 title deeds were issued.  On average, this represents approximately 1,000 titles per year, covering less than two percent of the land in Cameroon. In 2009, a study by the African Development Bank (AfDB) identified other distinctive patterns in land ownership. For example, formal land registration is more common in urban (60 percent) than in rural areas. According to the World Bank, the registration process can cost up to 13.7 percent of the property value.

Land disputes are common among Cameroonian citizens. The disputes are generally caused by non-respect of commercial sales contracts or by informal sales of land. Illegal occupation of property is also common.

Intellectual Property Rights

The legal structure for intellectual property rights (IPR) and corresponding enforcement mechanisms are weak. IP infringement and theft are especially common in the media, pharmaceuticals, software, and print industries. To secure a trademark registration right, a Cameroonian attorney must prepare and file a trademark application with the African Organization for Intellectual Property (OAPI), which is headquartered in Yaoundé. The courts are responsible for enforcement.

There were no new IPR-related laws or regulations enacted during the previous year. The government seizes and publicly burns counterfeit goods. These actions are not documented systematically, and no cumulative data exist on the seizures. Cameroon is not listed in the United States Trade Representative (USTR) Special 301 Report or the Notorious Markets List. For additional information about national laws and points of contact at local IP offices, please see WIPO’s country profiles at http://www.wipo.int/directory/en/. 

Capital Markets and Portfolio Investment

The Cameroonian government is open to portfolio investment. With the encouragement of the IMF and BEAC, Cameroon and other members of the CEMAC region have designed policies that facilitate the free flow of financial resources into the product and factor markets.

The Central African Regional Stock Exchange (BVMAC) is the result of the July 2019 fusion of the Douala Stock Exchange (DSX) with the Central African Regional Exchange. In its organization, the main parties are – (i) BEAC, the Central Bank of Central African States, which is the central depositor and settlement bank, (ii) COSUMAF (the Financial Markets Commission), based in Libreville, which is the central body of the financial market examines and approves investors, and (iii) Stock Exchange, which is the market enterprise, secondary market, and collects and carries out compensation, issues securities (state bonds).

Restructuring/re-creation of BVMAC is in process, with the elaboration of new rules and regulations, and public consultations ongoing. With a current market capitalization  of less than $16 million, BVMAC comprises 8,500 securities accounts, 150 participants, and carries out quotations three times a week. Regional foreign exchange (forex) controls significantly impact BVMAC’s operations. While the market has experienced profitability, it is difficult to invest the profits due to the forex controls. As such, a mechanism that allows foreign investors to use their forex to invest in the BVMAC would be beneficial to the regional financial market.

The Financial Markets Commission of Cameroon merged operations with the Libreville-based Central African Financial Market Supervisory Board in February 2019. The merger has led to the establishment of a unique regional stock exchange called the Central African Stock Exchange (CASE). Cameroon’s financial sector is underdeveloped, and government policies have limited bearing on the free flow of financial resources into the product and factor markets. Foreign investors can get credit on the local market and the private sector has access to a variety of credit instruments. In 2016, Cameroon sought to encourage the development of capital markets through Law No 2016/010 of July 12, 2016, governing undertakings for collective investment in transferable securities in Cameroon.

Cameroon is connected to the international banking payment system. The country is a CEMAC member, which maintains a central bank, BEAC. CEMAC’s central bank works with the IMF on monetary policies and public finance reform. BEAC respects IMF Article VIII by refraining from restrictions on payments and transfers for current international transactions. Despite generally respecting Article VIII, BEAC has instituted several restrictions on payments to boost foreign exchange reserves. Financial institutions and importers complain of a backlog of requests for foreign exchange. BEAC is currently negotiating with several international oil companies on repatriation of revenues before external payments. Investors should be aware that timely repatriation of profits may be a stumbling block.

In 2020, with the support of the IMF, BEAC took steps to address the economic impact of COVID-19 in the region. The central bank eased monetary policy and introduced accommodative measures to ensure adequate liquidity in the banking system to supporting internal and external stability. Concomitantly, the regional banking sector controller (Commission Bancaire de l’Afrique Centrale or COBAC) eased prudential regulations to help banks delay pandemic-related losses.

Money and Banking System

Only 15 percent of Cameroonians have access to formal banking services. The Cameroonian government has often spoken of increasing access, but no coherent policy or action has been taken to alleviate the problem. Mobile money, introduced by local and international telecom providers, is the closest tool to banking services that most Cameroonians can access. In its 2022 finance law, the government introduced a tax on electronic payment transfers, including the ubiquitously used “Mobile Money.” This tax remains in place.

The banking sector is generally healthy. Large, international commercial banks do most of the lending. One local bank, Afriland, operates in Cameroon and multiple other countries. Most smaller banks deal in small loans of short duration. Retail banking is not common. According to the World Bank, non-performing loans were 10.31 percent of total bank loans in 2016. The Cameroonian government does not keep statistics on non-performing assets. According to Cameroon’s National Credit Council, Afriland First Bank, Societe General Cameroun (SGC), Banque Internationale du Cameroun pour l’Epargne et le Credit (BICEC), and Societe Commerciale de Banque Cameroun (SCB) are the most important banks in the national banking system, accounting for 52 percent of the banking system’s total consolidated balance sheet, 54 percent of total loans, and 54 percent of customer deposits in 2020.

Foreign banks can establish operations in Cameroon. Most notably, Citibank and Standard Chartered Bank have operated in Cameroon for more than 20 years. They are subject to the same regulations as local banks. The U.S. Embassy in Yaoundé is unaware of any lost correspondent banking relationships within the past three years. In 2022, Standard Chartered Bank announced it would be exiting the Cameroonian market and four other African countries, however no timeline for the exit is known. There are no restrictions on foreigners establishing bank accounts, credit instruments, business financing, or other such transactions.

The country has 412 registered microfinance institutions, 19 insurance companies, four electronic money institutions, and one Post Office bank. Two major money transfer operators are also present, essentially offering over-the-counter services. The Cameroonian market is at the startup stage for its digital financial system. This emerging market segment is currently provided by banks in partnership with telecom operators. According to a 2021 BEAC report on the state of electronic payments in the CEMAC zone, electronic money payments in the CEMAC region increased 21.8 percent from 2019 to 2020, totaling approximately $51 million in 2020 compared to $42 million in 2019. Cameroon represented the largest amount of electronic payment transfers, accounting for 73 percent of all CEMAC transactions and totaling over $20 million in 2020.

Financial inclusion is low despite some progress brought about by mobile telephony. The World Bank estimates there were 25 million mobile cellular subscriptions in Cameroon in 2020. Putting aside the effect of multiple sim card ownership, the penetration rate in terms of unique subscribers was about 50 percent at the end of 2019, which puts Cameroon in the lower end in the Central African region.

Local banks do not give enough credit and there are lengthy delays of up to 15 months in giving credit. Interest rates could be as high as 8.5 percent and taxes and commissions tack on another 35 percent approximately, forcing businesses to limit transaction volumes.

The liquidity of the banking system is high, but most funding goes to the government, as local banks are reluctant to fund the local private sector even if they present collateral.

Foreign Exchange and Remittances

Foreign Exchange

In December 2022, BEAC reported that net foreign assets increased by 20 percent, compared to 11 percent in 2021, following disbursements of Cameroon’s IMF hybrid credit facility. On March 1, 2019, CEMAC members through BEAC adopted a foreign exchange currency regulation, that requires domiciliation of accounts in local banks for individuals and businesses who wish to execute cross-border transactions of significant amounts. All sectors of the economy without exception are subject to the regulations. Given the importance of the oil sector in the economy of the region and the challenges in the implementation, BEAC had allowed for a moratorium on implementation which ended on December 31, 2022. In addition, the bank has tightened administrative procedures. Each request for a foreign exchange transaction requires a “dossier” that would include various documents. The documents required vary based on the type of transaction to demonstrate the “legitimacy” of the planned purchase in foreign exchange that BEAC would approve. The formal list of required documents from BEAC is long. On December 23, 2021, CEMAC member countries adopted Regulation N°01/CEMAC/UMAC/CM easing certain provisions of the foreign exchange regulations for the resident extractive companies. This regulation allows extractive companies to open and operate onshore and offshore accounts in foreign currencies inside and outside the CEMAC zone.

Forex issues have been reported by the BVMAC as undermining foreign investments in the stock exchange. Local businesses that import and operate international businesses also face challenges with forex restrictions. Some use third parties to overcome forex limitations. Due to foreign exchange problems, most businesses are forced to reduce their quantities of imported goods.

The IMF has stated that forex transactions of less than $1 million only require approval by local BEAC representatives in each country and should take place in a matter of days. Forex transactions exceeding $1 million require approval from BEAC headquarters in Yaoundé and should occur in less than 48 hours. Banks and other financial institutions complain that requests are often rejected on minor technical grounds. In practice, approved requests often take more than two weeks to process.

Additionally, as of May 2020, BEAC requires international oil companies to repatriate 70 percent of proceeds from the sale of oil and gas and then apply to receive dollars or euros. In theory, funds associated with any form of investment can be freely converted into any world currency, but the current BEAC restrictions are causing currency conversion concerns at financial institutions and oil companies.

The Central African CFA Franc is the currency of six independent states in Central Africa: Cameroon, Central African Republic, Chad, Republic of the Congo, Equatorial Guinea, and Gabon. It is administered by BEAC and is currently pegged at roughly 662.64 CFA to one euro (April 13, 2023).

Remittance Policies

According to World Bank data, Cameroon received $430 million in remittances in 2021 and sent $40 million in 2021.

Apart from the tightening of foreign exchange and remittance rules in 2019, the U.S. Embassy in Yaoundé is unaware of any recent changes or plans to change investment remittance policies that either tighten or relax access to foreign exchange for investment remittances. BEAC regulates remittance policies and banking transactions. Foreign investors can remit through convertible and negotiable instruments through legal channels recognized by BEAC, subject to the recent issues mentioned above.

Sovereign Wealth Funds

Cameroon does not have a sovereign wealth fund.

Privatization Program

In general, privatization appears to be on hold. The government favors public-private partnerships or some variations of outsourcing of contractual management, with the state retaining some ownership of assets or of the SOE, rather than outright privatization. The state retains control of infrastructure, and there are no indications that this situation will change soon. There have been calls for the government to list part of its stakes in state-owned companies on the Central African Stock Exchange (CASE).

Foreign investors can and do participate in the privatization programs. According to some analysts, of the 30 state-owned companies that were privatized before 2004, foreign bidders won the majority (22). For example, a British private equity firm owns the controlling share in ENEO, the country’s electricity monopoly. The public bidding on tender offers is transparent. They are advertised in the media, but the actual process of awarding contracts may still be tainted by corruption, particularly on large projects. The listing of public tenders in the Cameroon Tribune newspaper – the government-owned paper of record – and publication of which firms received the contract do not guarantee a fully transparent process of awards.

Additional Resources

Department of State

• Country Reports on Human Rights Practices ( https://www.state.gov/reports-bureau-of-democracy-human-rights-and-labor/country-reports-on-human-rights-practices/)
• Trafficking in Persons Report ( https://www.state.gov/trafficking-in-persons-report/)
• Guidance on Implementing the “UN Guiding Principles” for Transactions Linked to Foreign Government End-Users for Products or Services with Surveillance Capabilities ( https://www.state.gov/key-topics-bureau-of-democracy-human-rights-and-labor/due-diligence-guidance/)
• U.S. National Contact Point for the OECD Guidelines for Multinational Enterprises ( https://www.state.gov/u-s-national-contact-point-for-the-oecd-guidelines-for-multinational-enterprises/)
• Xinjiang Supply Chain Business Advisory ( https://www.state.gov/xinjiang-supply-chain-business-advisory/)

Department of the Treasury

• OFAC Recent Actions ( https://home.treasury.gov/policy-issues/financial-sanctions/recent-actions )

Department of Labor

• Findings on the Worst Forms of Child Labor Report ( https://www.dol.gov/agencies/ilab/resources/reports/child-labor/findings  )
• List of Goods Produced by Child Labor or Forced Labor ( https://www.dol.gov/agencies/ilab/reports/child-labor/list-of-goods )
• Sweat & Toil: Child Labor, Forced Labor, and Human Trafficking Around the World ( https://www.dol.gov/general/apps/ilab )
• Comply Chain ( https://www.dol.gov/ilab/complychain/ )

Climate Issues

Cameroon revised its nationally determined contributions in November 2021. Cameroon’s mitigation target is to reduce greenhouse gas emissions by 35 percent by 2035. Mitigation targets are focused on forest management, energy, agriculture, and waste. Cameroon developed a National Adaptation Plan in 2015. Cameroon’s adaptation strategies include integrating adaptation planning into national sectoral strategies and policies, reducing the vulnerability of major economic sectors and agro-ecological zones to climate change, and raising awareness among the population. The U.S. Forest Service is building the capacity of government of Cameroon officials to collect, monitor, and analyze climate data in support of their national and international reporting needs. With U.S. government support, Cameroon published its first atlas of land coverage in 2021. Cameroon developed a National Biodiversity Strategy and Action Plan in 2012 to integrate the conservation and sustainable use of biological diversity into relevant sectoral or cross-sectoral plans, programs, and policies.

Cameroon does not have policies to achieve net-zero carbon emissions by 2050, but the government recognizes the huge role its forests, which are in the Congo Basin Forest region, play as a carbon sink and focuses mitigation targets on the forestry sector. Cameroon does not specify expectations on private sector contributions to achieving relevant climate targets. All infrastructure projects are compelled to conduct an Environmental and Social Impact Assessment to establish the impact of projects on people and nature. The National Development Strategy has integrated environmental protection into its objectives.

There are no local Environmental, Social, and Governance (ESG) norms, so businesses and institutions align with global ESG norms and global climate adaptation and mitigation frameworks. The government through Ministry of Environment and Nature Protection (MINEPDED) is developing some directives, which are presented to businesses during seminars. There are no reports of enforcement of ESG norms.

Resources to Report Corruption   

Rev. Dieudonné MASSI GAMS
Chairman
National Anti-Corruption Commission
B.P. 33200 Yaoundé Cameroon
(+237) 22 20 37 32
www.conac-cameroun.net
infos@conac-cameroun.net 

Transparency International Cameroon
Nouvelle route Bastos, rue 1.839, BP: 4562 Yaoundé
(+237) 22 68 23 30
ticameroon@yahoo.fr 
https://ti-cameroun.org/