Property rights and land use in São Tomé and Príncipe
São Tomé and Príncipe (STP) is a small island country located in the Gulf of Guinea. Its land ownership system is influenced by its colonial past and changes made after it gained independence. This summary explores property rights and land use by foreigners, discussing its history, current laws, and specific rules as of March 7, 2025.
Historical Background
The story of land ownership in STP dates back to when the Portuguese colonized the islands starting around 1470. The economy relied on plantation farming, focusing on sugar and cocoa, which were produced on large estates owned by Portuguese settlers. These plantations were worked by enslaved Africans and later by contract laborers.
After gaining independence in 1975, the government nationalized all land, making it owned by the state. This was part of a move to redistribute wealth and power from colonial elites to the country. The large estates were turned into state-run farms.
In the early 1990s, land reforms began to return some land to individual farmers. This process gave small pieces of land (about two hectares each) to former agricultural workers. However, these farmers usually only received usage rights, not full ownership. This meant they could use the land and benefit from it, but not sell or borrow against it, which limited their access to loans and created challenges in land transactions.
Current Legal Framework
The current land laws are based on the Land Law of 1998 and the Investment Code of 2012. These laws regulate how land can be owned and used by both locals and foreigners.
Types of Land:
- State Land: Owned by the government and used for public purposes. It cannot be privately owned.
- Private Land: Can be owned by individuals or companies, usually as a result of the 1990s reforms.
- Community Land: Owned collectively by local groups for traditional uses.
Property Rights for Foreigners:
- Foreigners cannot own state land, but some exceptions have occurred where foreign investors received full ownership of state properties in specific cases.
- Foreigners can buy private land if it's on sale and they have a residence permit.
- They can also lease state land for up to 20 years, with automatic renewals unless canceled with two years' notice.
- Regular foreign nationals can own up to two hectares of land unless their investment project is approved.
Investment Opportunities
The Investment Code allows foreigners to acquire land for economic projects. This includes agriculture and tourism developments. For these projects, foreigners may be able to own more land than the usual two-hectare limit if they align with local laws.
Specific Cases:
- Foreign investors, like Claudio Corallo from Italy, often lease land for agricultural purposes. The government prefers this method over selling land outright.
- Although there are cases of foreigners being granted full ownership of state land, these are rare and depend on government approval.
Limits and Restrictions:
The two-hectare limit for foreign nationals helps keep land available for local people but allows exceptions for beneficial investment projects.
Challenges and Impact
The mixed system of state, private, and community land creates challenges for foreign investors. Many local farmers have only usage rights, which limits land transactions and complicates access to credit.
For foreigners, dealing with leases and potential ownership transfers can be complicated and slow. The government focuses on promoting economic development through investment projects, which sometimes leads to competition between local and foreign interests due to the small size of the economy and limited available land.
In summary, while opportunities exist for foreign investments in São Tomé and Príncipe, understanding the land ownership system and navigating its complexities can be challenging.
Important notice: We have compiled this information to the best of our knowledge However, we strongly advise verifying the applicable legal situation before finalizing any purchase. We accept no liability for this information .