The Emphyteutic Lease
The legal and secure solution to becoming a property owner in Madagascar as a foreigner
In Madagascar, full land ownership is reserved for Malagasy nationals. For foreigners wishing to invest long-term in real estate, the long-term lease This constitutes the most stable and secure legal solution. This guide details how it works, its advantages, the conditions for obtaining it, and the key points to be aware of before committing.
What is an emphyteutic lease?
An emphyteutic lease is a long-term rental contract that grants its holder — the’emphyteus — a right of use and enjoyment of real estate belonging to a lessor (the landowner), for a prolonged period of 18 to 99 years old, renewable.
Throughout the duration of the lease, the leaseholder benefits from real estate rights The lessee can use, enjoy, exploit, and improve the property as if they were the owner, within the limits set by the contract, while remaining responsible for its maintenance and preservation. It is this nature of a real right—and not a simple personal right like an ordinary lease—that distinguishes emphyteusis from conventional rentals.
Build
To construct buildings or infrastructure on the leased land.
To arrange
To carry out landscaping, improvements or planting.
Exploit
To use, enjoy and exploit the property as if he were the owner.
To sell
Mortgaging or assigning one's rights, sometimes under contractual conditions.
The advantages of long-term leases for foreigners
Faced with restrictions on full land ownership, the long-term lease offers three major advantages to foreign investors wishing to establish a long-term presence in Madagascar:
Secure access to the property
A secure alternative to direct land acquisition, restricted for non-nationals. This long-term contract (up to 99 years) guarantees exclusive and legally stable use of the property.
The right to build and develop
The leaseholder can construct, develop and operate the property according to their project (hotel, residence, agriculture, etc.). The buildings constructed belong to them for the entire duration of the lease.
Transferability
Emphyteutic rights are in principle assignable, transferable and mortgageable, except for contractual restrictions — an appreciable asset flexibility for a medium or long-term strategy.
Emphyteutic lease or full ownership: what are the differences?
| Criteria | Emphyteutic lease | Full ownership |
|---|---|---|
| Accessible to foreigners | YES | NO |
| Duration | Ages 18 to 99, renewable | Perpetual |
| Land ownership | The landlord is responsible for this. | To the holder |
| Right to build / to operate | YES | YES |
| Right to assign / transfer | Yes, subject to contractual conditions. | Yes, freely |
| Mortgage | Yes, on the emphyteutic right | Yes, on the good |
| Notarized deed required | YES | over 15,000,000 MGA |
| Outcome of constructions at the end of their contract | Accession to the landlord, unless otherwise stipulated | Not applicable |
The precise terms (rent, renewal or transfer clauses) depend on the contract signed before a notary — careful reading before signing is essential.
Conditions for obtaining a long-term lease in Madagascar
Foreigners wishing to enter into a long-term lease may have resident or non-resident status in Madagascar — this distinction is not an obstacle to the conclusion of the contract.
The long-term lease must imperatively be established by notarial deed, in accordance with Article 82, paragraph 3 of Law No. 2007-026 concerning the status of notaries in Madagascar:
«"The instruments establishing a real property right or modifying its composition must be executed in authentic form by a notary."»
This requirement guarantees three essential things: the legal security of the contract, its validity before the land administration, and its probative force in case of a dispute.
Duration, renewal and taxation
Duration and renewal. The lease is concluded for a period of between 18 and 99 years. Its renewal — by tacit renewal or by express agreement between the parties — depends on the clauses provided for in the initial contract: it is essential to check them before signing.
Registration. To be enforceable against third parties, the long-term lease must be registered with the Land Registry, just like a real estate right. This formality, along with the associated registration fees, is in addition to the notary fees that must be factored into the project budget.
End of lease. Upon expiry of the contract, the constructions and developments carried out in principle revert to the lessor by accession, unless there is a clause to the contrary providing for compensation to the leaseholder — a point to be negotiated carefully when drafting the contract.
Points to consider before signing
Before committing, several checks are necessary:
- there remaining time of the lease and the precise conditions of its renewal; ;
- THE assignment clauses and early termination, and the landlord's terms of agreement; ;
- L'’landlord's identity and the regularity of the underlying land title (Registered Land Title); ;
- the fate of constructions and improvements at the end of the contract.
Support from a notary — and, if necessary, legal advice specializing in Malagasy land law — remains strongly recommended to secure each step.
A long-term lease project in Madagascar?
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