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June 18, 2022 0 Comments

Investing in Real Estate in the DR Congo: Ownership, Rights and Usage of the Land

Real estate market in the Democratic Republic of Congo [DRC] is vast, especially for urban centres, like Kinshasa, Lubumbashi, Kisangani, Goma, Kolwezi, Bukavu, Matadi, etc.

1. Introduction

Sustained population growth over the last thirty years and the changing socio-economic development led to a rapid development of Congolese towns and a strong demand relative to supply. Hence, the overall housing deficit estimated at 2.4 million for the period 1999 to 2010, or 240,000 homes to be built per year.

Currently, real estate sector in DR Congo is characterized by:
– a very low number of developers (private or public);
– the absence of property developers both public and private;
– the lack of institutions specializing in the financing of real estate;
– the mismatch between the development of Congolese towns and service infrastructure;
– the absence of barriers
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of entry for new investors, resulting in easy penetration of the market.

2. Land tenure

Land tenure is organised by the Land Code creating a distinction between ownership of the land and ownership of the right to use the land. The soil belongs exclusively to the Congolese State and all natural or legal persons can obtain a right of possession by means of a concession contract . These concessions can be obtained either free of charge or against payment.

2.1 Land concessions

The Land Code is dividing the different kinds possession rights into three categories; (1) concessions in perpetuity, (2) ordinary concessions, and (3) land easement. In this brief, we shall give an overview of the two different types of concessions in the following paragraphs.

2.1.1 Concessions in perpetuity

A concession in perpetuity grants its beneficiary the right to enjoy his land eternally, as long as the conditions for the granted concessions are being met, and in order to be eligible for this kind of concession the applicant must be a natural Congolese national .

The concession contract stipulates the parties’ respective rights and obligations in addition to the prescriptions of the Land Code.

a. Obligations

Whenever the concession was granted against payment, the concessionaire is held to pay levies and the agreed price for the concession .

The State on the other hand has the main obligation to safeguard the concessionaire’s undisturbed use of his concession for the remaining of its validity .

b. Rights

The main right of the concessionaire, as stipulated in the Land Code, is the right to construct, to plant, and to dispose of any constructions or plants which were already present or which he constructed or planted after obtaining the concession. Furthermore the concessionaire becomes the rightful owner of everything incorporated on his land for the duration of his concession . This means a concessionaire may construct a building on his land, of which he will become the owner for as long as his concession is granted, and can be compared with building and planting rights.

c. Termination

A concession in perpetuity can only cease to exist in very specific situations, as set out in the Land Code . And in case an expropriation takes place, the concessionaire will be indemnified for any buildings and other constructions of which he is the owner.

2.1.2 Ordinary concessions

Beside the concessions in perpetuity, which can only be granted to Congolese nationals, the Land Code also provides for ordinary concessions to be granted to foreign individuals and to Congolese or foreign companies, which take the form of a land lease, building lease, usufruct, right of common, or rent .

a. Land lease

In French “emphytéose” is the right to have full enjoyment of a piece of land belonging to the State, under the obligation to maintain the land value and to pay a duty. This right is granted for renewable 25 year terms and can only be revoked by the State under specific conditions. In practice these concessions are being renewed almost automatically to e.g. foreign investors having construed buildings on the land for which they obtained a land lease.

b. Building lease

In French “superficie”, also granted for renewable 25 year terms, the right to enjoy a piece of land belonging to the State grants its beneficiary all the rights a usufructuary is granted. However, the beneficiary may not dispose of any buildings on his land except in specific circumstances.

c. Usufruct

In French “usufruit”, the right of usufruct allows its beneficiary to use and enjoy the land, besides the State, but with the obligation to keep the land in its original state. Once again, this right is also granted for renewable 25 year terms but ends upon decease of its beneficiary (intuitu personae).

d. Right of common

In French “usage”, granted for a renewable 15 year term, the right of common allows its beneficiary and his family to live or create a warehouse on the premises.

e. Rent

In French “location”, a rent can only be accorded for 3 years and is often used as preparation for another kind of concession and doesn’t confer much rights upon the tenant.

Many foreign investors are constructing buildings in the DRC and are aware of this outdated land tenure regulation. However, in practice the 25 year term concessions are being (automatically) renewed. Concessions are also easily transferable.

2.2 Obtaining a concession

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