What are constitutive procedures to establish a company?
What are constitutive procedures to establish a company?
• A company setting up:
- Establishment of the company act in authentic form by a notary
- Publication of memorandum of association in the official bulletin of legal advertisements;
- Registration in trade register within two months following the setting up of the company
The trade register may be obtained within 24 hours on the basis of a file comprising the following documents:
• A signed application, drawn up on forms provided by the Center of the Trade Register, or by its representative at the formalities fulfillment center of ANDI;
• The premises Proof, justifying its capacity to host a commercial activity;
• The receipt confirming the payment of stamp duty as provided by the law;
• The payment receipt of registration fees in the trade register, fixed by the legislation in force;
• A copy of the resident card for foreign people
• The approval or authorization issued by the competent authorities for carrying out regulated activities;
For legal entities:
• A copy of the company statutes;
• A copy of the Company's statutes insertion notice in the Official Bulletin of Legal Announcements (BOAL)
Investors will be able to fulfill the formalities for setting up their company through the online services of the Algerian portal of company setting up: www.jecreemonentreprise.dz
• Declaration of Existence
It must be made at the Inspectorate of Taxes territorially competent, within thirty (30) days from the beginning of the activity.
• Foreign trader card (if need be)
It is issued by services in charge of regulations of the territorially competent province. The application must be submitted, attached with the following documents:
• Copy of trade register of the legal entity established abroad;
• Copy of the represented company statutes, drawn up in authentic deed;
• Passport copy;
• Five (5) regulatory identity photos.
- Establishment of the company act in authentic form by a notary
- Publication of memorandum of association in the official bulletin of legal advertisements;
- Registration in trade register within two months following the setting up of the company
The trade register may be obtained within 24 hours on the basis of a file comprising the following documents:
• A signed application, drawn up on forms provided by the Center of the Trade Register, or by its representative at the formalities fulfillment center of ANDI;
• The premises Proof, justifying its capacity to host a commercial activity;
• The receipt confirming the payment of stamp duty as provided by the law;
• The payment receipt of registration fees in the trade register, fixed by the legislation in force;
• A copy of the resident card for foreign people
• The approval or authorization issued by the competent authorities for carrying out regulated activities;
For legal entities:
• A copy of the company statutes;
• A copy of the Company's statutes insertion notice in the Official Bulletin of Legal Announcements (BOAL)
Investors will be able to fulfill the formalities for setting up their company through the online services of the Algerian portal of company setting up: www.jecreemonentreprise.dz
• Declaration of Existence
It must be made at the Inspectorate of Taxes territorially competent, within thirty (30) days from the beginning of the activity.
• Foreign trader card (if need be)
It is issued by services in charge of regulations of the territorially competent province. The application must be submitted, attached with the following documents:
• Copy of trade register of the legal entity established abroad;
• Copy of the represented company statutes, drawn up in authentic deed;
• Passport copy;
• Five (5) regulatory identity photos.
Is employment of foreigners authorized?
Is employment of foreigners authorized?
Yes, subject to a work permit or authorization.
What are the procedures concerning the employment of foreigners?
What are the procedures concerning the employment of foreigners?
- Procedure for obtaining work permit:
An application is submitted to the concerned person’s file is submitted by the employer to the National Agency of Employment – Department of labour. The permit is generally given within two weeks. - Procedure for obtaining resident’s permit:
An application is submitted to an administrative file is submitted to the territorially competent police station.
• What are the main rules governing foreign investment?
• Investments initiated by foreign individuals or legal entities in production, services and imports activities, must be realized in partnership with one or several national resident investors, public or private, in which the Algerian partner must hold 51% of the partnership company capital.
• The indirect transfers (a transfer of 10% or more of shares, carried out in one or several operations cumulated for the benefit of a same purchaser) of Algerian law companies, having benefited from advantages during its implementation period, gives rise to inform the State shareholdings Council (CPE).
• Are the activities offshoring allowed and in which case does it give rise to the investment advantages granting?
Yes. Activities offshoring are allowed.
Renovated old equipment imported under the conditions set by the regulations in force in the case of activities offshoring are eligible to the advantages, granted within the framework of investment incentives scheme. These goods are cleared, in exemption from the foreign trade and banking domiciliation formalities.
How to find a partner for your investment project?
How to find a partner for your investment project?
The National Agency for Investment Development has developed a database called partnership portfolio http://www.andi.dz/index.php/en/bourse-de-partenariat . This portfolio is intended to collect investment projects, the promoters of which are looking for partners.
Operators wishing to register in this database may submit a description of their projects, as well as their expectations, in terms of partnership, according to the Project Sheet available to them in the web site of the Agency "www.andi.dz" at the "Partnership portfolio" section. The Agency, after treatment of this information will proceed to a restricted dissemination of some information and ensuring the confidentiality of the other.
The promoters may also consult the projects already registered by clicking on the second part of this section.
Registration to the partnership Portfolio is free.
The promoters may also consult the projects already registered by clicking on the second part of this section.
Registration to the partnership Portfolio is free.
What are the advantages granted by the investment promotion law?
What are the advantages granted by the investment promotion law?
The investment projects may enjoy from tax and special taxation exemptions and reductions, depending on the project location, the carried out activity and the project impact on the economic and social development.
Three levels of advantages are provided:
- the common advantages to all eligible investments;
- the additional advantages to the privileged and/or jobs creating activities;
- the exceptional advantages to investments bringing a particular interest for the national economy.
Main granted advantages:
Level 1: the common advantages to all eligible investments
A/ Projects implemented in the north
a) Implementation period
a- exemption from customs duties on imported goods, directly involved in the investment implementation;
b- VAT exemption for goods and services, imported or acquired locally, directly involved in the investment implementation;
c- Exemption from the transfer duty and land advertisement fees on all property acquisitions made as part of the investment concerned;
d- Exemption from registration fees, land advertisement fees and the state owned property remuneration on built and non-built property, granted for the implementation of investment projects. This benefit is applied for the minimum duration of the granted concession.
e- Deduction of 90% on the annual rental fee amount, set by the service of domain for the investment implementation period;
f- Exemption from land tax on real estate within the framework of the investment for a period of ten (10) years from the acquisition date;
g- Exemption from registration duties on acts of corporations and capital increases.
b) Exploitation period:
For a period of (3) years after the operation start up report, drawn up by the tax authorities at the behest of the investor:
a- Tax exemption on companies’ profits (IBS);
b - Exemption from the tax on the turnover (TAP);
c- 50% deduction on the annual rental fee amount set by the state property department
B/ projects implemented in the South, the highlands and areas whose development requires a particular contribution de the State
a) Implementation period:
• Exemption from customs duties on imported goods directly involved in the investment implementation.
• VAT exemption on goods and services directly involved in the investment implementation, whether they are imported or purchased on the local market;
• Exemption from transfer tax, subject to payment, on real estate acquisitions made within the framework of the investment
• exemption from registration fees, land advertisement tax and the state owned property remuneration on built and non-built properties concessions, granted for the investment projects implementation. This benefit is applied for the minimum duration of the granted concession;
• Exemption from land tax on real estate within the framework of the investment for a period of ten (10) years from the acquisition date;
• Exemption from registration duties on acts of corporations and capital increases;
• Partial or total support by the State, after the Agency’s assessment, of expenditures concerning infrastructure works needed to the implementation of investment;
• Reduction of the annual rental fee amount set by the state property department, on the land concession, for the investment projects implementation:
- To the symbolic dinar per square meter (m2) for a period of ten (10) years and 50% of the annual rental fee amount beyond this period for investments located in localities within the Highlands and other areas whose development requires special contribution of the State;
- To the symbolic dinar per square meter (m2) for a period of fifteen (15) years and 50% of the annual rental fee amount beyond this period for investment projects implemented in the regions of the South.
B-Exploitation period and for ten (10) years:
- Tax exemption on companies’ profits (IBS);
- Exemption from the tax on the turnover (TAP);
-50% deduction on the annual rental fee amount set by the state property department
Level 2: additional advantages to the privileged and/or jobs creating activities
There are particular taxes and financial incentives introduced by the legislation in force, for tourist, industrial and agricultural activities, which cannot be cumulated with the advantages of the Investment Promotion Law provisions. In this case the promoter benefits from the most advantageous incentive plan.
For investments, implemented out of areas to be promoted, and generating more than one hundred (100) permanent jobs, the duration of tax exemption during the exploitation period is five (5) years.
Level 3: exceptional advantages to investments bringing a particular interest for the national economy
a) Implementation period
• All the common advantages for the implementation period
• granting, according to the legislation in force, of exemptions or reduction of customs duties, taxes, and any other imposition with fiscal character, granting of subsidies, aids or financial supports, as well as any facilitation measures likely to be granted,
• Possibility, after the CNI agreement, of the implementation period advantages transfer from the investor to contracting parties, in charge of the investment implementation, for the investor.
b) Exploitation period
• Extension for a period of up to ten (10) years, of the duration of the common advantages granted during the exploitation period,
• granting of the duty-free purchase scheme for goods and materials used in the production of goods benefiting from the value added tax exemption,
• Granting for a period not exceeding 5 years of exemptions or reductions of duties, taxes including VAT applied on the prices of goods produced within the framework of emerging industrial activities.
Three levels of advantages are provided:
- the common advantages to all eligible investments;
- the additional advantages to the privileged and/or jobs creating activities;
- the exceptional advantages to investments bringing a particular interest for the national economy.
Main granted advantages:
Level 1: the common advantages to all eligible investments
A/ Projects implemented in the north
a) Implementation period
a- exemption from customs duties on imported goods, directly involved in the investment implementation;
b- VAT exemption for goods and services, imported or acquired locally, directly involved in the investment implementation;
c- Exemption from the transfer duty and land advertisement fees on all property acquisitions made as part of the investment concerned;
d- Exemption from registration fees, land advertisement fees and the state owned property remuneration on built and non-built property, granted for the implementation of investment projects. This benefit is applied for the minimum duration of the granted concession.
e- Deduction of 90% on the annual rental fee amount, set by the service of domain for the investment implementation period;
f- Exemption from land tax on real estate within the framework of the investment for a period of ten (10) years from the acquisition date;
g- Exemption from registration duties on acts of corporations and capital increases.
b) Exploitation period:
For a period of (3) years after the operation start up report, drawn up by the tax authorities at the behest of the investor:
a- Tax exemption on companies’ profits (IBS);
b - Exemption from the tax on the turnover (TAP);
c- 50% deduction on the annual rental fee amount set by the state property department
B/ projects implemented in the South, the highlands and areas whose development requires a particular contribution de the State
a) Implementation period:
• Exemption from customs duties on imported goods directly involved in the investment implementation.
• VAT exemption on goods and services directly involved in the investment implementation, whether they are imported or purchased on the local market;
• Exemption from transfer tax, subject to payment, on real estate acquisitions made within the framework of the investment
• exemption from registration fees, land advertisement tax and the state owned property remuneration on built and non-built properties concessions, granted for the investment projects implementation. This benefit is applied for the minimum duration of the granted concession;
• Exemption from land tax on real estate within the framework of the investment for a period of ten (10) years from the acquisition date;
• Exemption from registration duties on acts of corporations and capital increases;
• Partial or total support by the State, after the Agency’s assessment, of expenditures concerning infrastructure works needed to the implementation of investment;
• Reduction of the annual rental fee amount set by the state property department, on the land concession, for the investment projects implementation:
- To the symbolic dinar per square meter (m2) for a period of ten (10) years and 50% of the annual rental fee amount beyond this period for investments located in localities within the Highlands and other areas whose development requires special contribution of the State;
- To the symbolic dinar per square meter (m2) for a period of fifteen (15) years and 50% of the annual rental fee amount beyond this period for investment projects implemented in the regions of the South.
B-Exploitation period and for ten (10) years:
- Tax exemption on companies’ profits (IBS);
- Exemption from the tax on the turnover (TAP);
-50% deduction on the annual rental fee amount set by the state property department
Level 2: additional advantages to the privileged and/or jobs creating activities
There are particular taxes and financial incentives introduced by the legislation in force, for tourist, industrial and agricultural activities, which cannot be cumulated with the advantages of the Investment Promotion Law provisions. In this case the promoter benefits from the most advantageous incentive plan.
For investments, implemented out of areas to be promoted, and generating more than one hundred (100) permanent jobs, the duration of tax exemption during the exploitation period is five (5) years.
Level 3: exceptional advantages to investments bringing a particular interest for the national economy
a) Implementation period
• All the common advantages for the implementation period
• granting, according to the legislation in force, of exemptions or reduction of customs duties, taxes, and any other imposition with fiscal character, granting of subsidies, aids or financial supports, as well as any facilitation measures likely to be granted,
• Possibility, after the CNI agreement, of the implementation period advantages transfer from the investor to contracting parties, in charge of the investment implementation, for the investor.
b) Exploitation period
• Extension for a period of up to ten (10) years, of the duration of the common advantages granted during the exploitation period,
• granting of the duty-free purchase scheme for goods and materials used in the production of goods benefiting from the value added tax exemption,
• Granting for a period not exceeding 5 years of exemptions or reductions of duties, taxes including VAT applied on the prices of goods produced within the framework of emerging industrial activities.
What are the bilateral agreements signed by Algeria and Greece on investment?
What are the bilateral agreements signed by Algeria and Greece on investment?
Agreement on the encouragement and protection of investments, signed in Algiers on 20th of February 2000.
www.joradp.dz/HFR/Index.htm
Is it possible to submitting a dispute to international arbitration in Algeria?
Is it possible to submitting a dispute to international arbitration in Algeria?
Yes. Algeria is member of New York Convention 1958 of International Center for Settlement of Investment Dispute between States and nationals of other States (ICSID) and United Nations Commission on International Trade Law (UNCITL).
What are the measures to protect foreign investment?
What are the measures to protect foreign investment?
Foreign investment is protected through the membership of Algeria to various international conventions regarding guarantee and protection of investments, and the signing of several bilateral agreements on foreign investment, including 46 conventions on reciprocal encouragement and protection of investments.
• Fair and equitable treatment as regards to the rights and obligations attached to investments made by foreign physical and legal persons
• Intangibility of the acquired advantages in the case of the legal framework change
• Protection of Industrial Property (trademarks, invention patents, designs and models, appellations of origin, diagrams of integrated circuits).
•Protection against administrative requisitions
• Admission of profits and dividends declared transferable, as the external inputs, for reinvestment in capital.
• Possibility of capital and income transfer, according to the regulation in force.
• Possibility of the technical capital assets transfer, acquired during the advantages period.
• Fair and equitable treatment as regards to the rights and obligations attached to investments made by foreign physical and legal persons
• Intangibility of the acquired advantages in the case of the legal framework change
• Protection of Industrial Property (trademarks, invention patents, designs and models, appellations of origin, diagrams of integrated circuits).
•Protection against administrative requisitions
• Admission of profits and dividends declared transferable, as the external inputs, for reinvestment in capital.
• Possibility of capital and income transfer, according to the regulation in force.
• Possibility of the technical capital assets transfer, acquired during the advantages period.
Are capital transfers allowed?
Are capital transfers allowed?
The investment code and the regulations of the Bank of Algeria No. 05-03 of June 06th, 2005, guarantee to foreign investors the right to transfer of dividends. This guarantee applies to the capital contributions in cash, in kind and the net products from the investments transfer and liquidation.
What are the transfer conditions?
What are the transfer conditions?
- Capital contributions in cash shall be imported through the banking channel, in a freely convertible currency, regularly quoted by the Bank of Algeria. Their amount must be equal to or more than minimum thresholds, determined according to the overall project cost, in accordance with the regulations. N.B: the reinvestment in capital, of profits and dividends that are declared transferable in accordance with the legislation and regulations in force, are admitted as external inputs. Only dividends generated from economic activities goods and services production are eligible for transfer. Dividends arising from resale activity are not, unless significant investments are made.
- The contributions in kind must be of external origin and be subject to an assessment, according to the rules and procedures governing the company’s constitution.
- The entity must duly prove that it has fulfilled all its tax obligations, including the payment of the withholding tax due in respect of the distribution of dividends. It must also prove that it has published the company accounts of the prior year.
- Possibilité de transfert de capitaux et de revenus, sous réserve des dispositions réglementaires en la matière;
- Possibilité de cession des actifs composant le capital technique, acquis, sous avantages;
- Automaticité des avantages.
