Start a Foreign Company in DRC
Due to its abundance of mineral deposits such as copper, cobalt, gold, diamonds, zinc, iron and uranium, the Democratic Republic of Congo (DRC) has the potential to become Africa’s richest economy, making it the best hub for foreign investors seeking to start a foreign company in DRC.
Want to start a Foreign Company in the DRC?
Step 1: Decide on the Type of Company
There are two options for registering a foreign company in the Democratic Republic of the Congo:
- Register a branch of your foreign company. This branch will operate as an extension of your foreign company. To do this, you will need to provide a notarised certificate and other registered documents from the parent company. Remember that the downside is that your foreign company will be directly liable for any liabilities that the branch incurs in the DRC.
- Register the company as a subsidiary or as a fully independent entity. To do this, you will need to provide the following documents:
- Three preferred names for the new company
- a description of the activities
- copies of the passports of the directors and shareholders
- Passport-size photographs of all directors and shareholders.
- postal, physical and email addresses, phone numbers and occupations of all shareholders and directors
- percentage of shares
Step 2: Choose a unique company name
Choosing a unique and distinctive name for your company is an important step. The name should reflect the personality of your business and be easily recognisable to your target audience.
Step 3. Approve the draft Articles of Association
The Articles of Association set out the internal rules and governance of the company. It includes details such as the company’s objectives, share capital, management structure, and shareholder rights.
Step 4. Notarise the Articles of Association
Once the Articles of Association have been prepared, they must be notarised by a licensed notary in the DRC. The notary verifies the authenticity of the document and confirms its legality. When submitting the Articles of Association, be sure to submit all necessary identification documents, company details, and payment of notary fees.
Step 5: Obtain a Tax Identification Number (TIN)
Every registered company in the DRC must have a Tax Identification Number (TIN). You can obtain a TIN by contacting the relevant tax office. Provide the necessary documents, such as proof of identification, company details, and Articles of Association. The TIN will be used for tax purposes and must be stated in all official business transactions.
Step 6: Register with the Trade Registry
To legalise your foreign company in DRC, you must register with the Trade Registry. Provide the necessary documents, including notarised Articles of Association, proof of payment of registration fees, identity cards of shareholders and directors, and any additional forms specified by the Trade Registry. Once your application has been processed and approved, you will receive a Certificate of Registration.
Step 7: Open a Corporate Bank Account
Once you have received the Certificate of Registration, open a corporate bank account in the DRC. Provide the necessary documentation, including the Certificate of Registration, proof of company address, identification documents, and proof of residence.
Taxes
The tax regime in the Democratic Republic of the Congo is quite simple: the personal income tax rate ranges from 0 to 30%, corporate tax is 30% for mining companies, corporate tax is 35% for other companies, and VAT is 18%.
Types of Business Structures in DRC Available for Foreign Investors
Society Limited by Liability (SARL) is an option for foreign investors looking to do business in the DRC, which is regulated by the OHADA (Organisation for the Harmonisation of Business Law in Africa) system. Foreigners may register a limited liability company with only one shareholder.
Limited liability companies in the DRC are classified into different categories depending on their structure and purpose. Common types of limited liability companies include:
- Private Limited Liability Company. A private limited liability company, designated as “Ltd.”, is a separate legal entity with limited liability for its owners. It limits the transferability of shares and requires a minimum number of shareholders.
- Public Limited Liability Company. A public limited liability company, designated as “Plc.”, allows the general public to purchase shares and trade them on the stock exchange. This requires a higher level of compliance and transparency.
- Non-profit company. Non-profit companies, often called associations or foundations, operate for charitable, religious or social purposes. They have specific rules governing their operations and financial management.
- Branch. A subsidiary of a foreign organisation that carries out part of its activities in the DRC.
Why Start a Foreign Company in DRC?
The DRC government has implemented programs to attract foreign investment, including:
- Under the Investment Code, companies will be allowed a full tax exemption for up to 5 years if they invest between US$10,000 and US$200,000 in a project approved by the National Investment Promotion Agency (ANAPI) and contribute at least 35% of the added value to that activity.
- Logistics companies established in the DR Congo enjoy certain tax incentives, including VAT exemption on intermediate and finished goods, import duty exemption on raw materials and equipment, and the availability of preferential tariffs on energy consumption for at least 4 years.
- Mining companies based in the DR Congo participating in the projects approved by the government will not be required to pay customs duties when exporting products to other countries. In addition, other fiscal benefits are also available, including exemption from land tax, vehicle tax, and road traffic tax.
- Companies importing or exporting electricity to the DR Congo will benefit from exemption from customs duties and VAT on imports of inputs for the production process, exemption from duties and VAT on imports of electricity, and a reduced rate of 1% on energy exports.
Conclusion
Starting a foreign company in the Democratic Republic of the Congo (DRC) involves a well-defined registration process. By following the steps for company registration mentioned above, you can navigate through the requirements and ensure a smooth registration for your business. At Afrilink Consultants, we help your foreign company set up operations in the DRC, leaving you to focus on the growth of your business. Reach out to us for consultation.
📩 clientservice@afrilinkconsultants.com
📞 +254707280366
