If you are looking for an opportunity to successfully enter African markets, opening a company in Algeria might be the best idea in 2021.
Algeria is the largest independent state in North Africa in terms of area, located in the west of the Mediterranean basin. The closest neighbors of the Republic of Algeria are Tunisia, Niger, Mali, Mauritania, Libya, and Morocco.
The state economy is majorly based on mining (oil, natural gas), service sector, trade, agriculture (agriculture, livestock), petrochemical, and food industries.
The capital of the country is Algeria. Largest cities: Setif, Annaba, Batna, Oran, and others. Official languages: Arabic / Berber. The population of the state is over 42.6 million people. The monetary unit is the Algerian dinar (DZD). The climate of the state is subtropical/tropical.
The Algerian People’s Democratic Republic is a member of the OIC, OPEC, and a number of its specialized organizations, the AMU, the Arab League, the African Union, and others.
Business Advantages of Algeria
Many foreign businessmen are striving to register a company in Algeria remotely in 2021, for the most part, focusing on loyal taxation and ample opportunities for opening virtually any type of business: micro, small, medium, or large.
If you want to open a business in an African country, then we bring to your attention the following business advantages of this jurisdiction:
- Dynamic economic growth;
- Stable political position;
- High interest of local authorities in attracting foreign investors;
- Qualified workforce;
- Developed banking system;
- Entry into the Pan-Arab Free Trade Zone;
- Loyal taxation;
- Availability of DTA agreements signed with African and European countries;
- Simple and fast business registration process.
Registration of a company in Algeria in 2021 can be a profitable solution if one of the following business areas is chosen: electricity, oil and gas industry, tourism, light industry, construction, and medicine.
Main legal business structure
If you plan to open a company in Algeria remotely, then first, you will need to choose one of the forms of economic activity permitted by the state:
- Limited Liability Company (LLC);
- Free Zone Company (FZC);
- Partnership (LP / GP);
- Joint Venture (JV);
- Representative Office (RO).
Any of the above OPFs can be opened as a limited liability company (SARL). If you are going to register a company in Algeria, then you better opt for these legal forms: LLC and FZC.
Registration Requirements
If you intend to register a company in Algeria, we recommend that you carefully study the following requirements of the local Regulator:
- Unique name (legal business structure must be indicated at the end, for example, LLC);
- Required number of directors: 1 or more (resident, individual / company);
- Required number of shareholders: 1 or more (individual/company);
- The authorized capital of the company: 1 thousand USD;
- Local registered office;
- Open a corporate account in Algeria;
- Submission of tax and accounting reports.
Tax regime
Registration of a company in Algeria is a fairly simple process that does not require a long wait. Before opening a business in this jurisdiction, we advise you to study the specifics of corporate taxation:
- The basic income tax rate is 26%. A rate reduction of up to 23% is possible for companies specializing in construction, heat power engineering, tourism, community service, and water supply. Also, there is a reduced rate of 19% for manufacturing enterprises;
- VAT rate: 9% and 19%;
- Dividends: 10% for residents, 15% for non-residents;
- Interest: 10%;
- Royalty: 24% (subject to DTA agreements, the following rates are acceptable: 5%, 10%, and 12%.
The procedure of opening a business
- Calculate how much of the available capital you are using to start your small business.
- Select the type of small business you want to start. The possibilities are almost endless.
- Explore the field thoroughly. Once you’ve chosen the type of small business you want to start, do your research in this area carefully. Find competitors and see how they are doing their business.
- Make a general plan of action. Describe in detail every step that stands between you and the ultimate goal of having a functioning small business.
- Decide what type of business structure you will use and fill out the appropriate forms. Choose between a sole proprietor, partnership, corporation, or LLC.
- Get a business license. For certain types of businesses, you must apply for a license. On the Small Business Administration website, you will find out if you need a business license for your chosen type of business. Once you get a license, you can start running a business.
