The insular unitary republic of Cape Verde is located on an archipelago of 18 islands in the Atlantic. The country gained independence in 1975. It is not difficult to open a business in Cape Verde since the country has a particular government program that includes foreign investment in the state development strategy. It should be noted that all foreign investments are subject to prior approval. The request for obtaining the status of a foreign investor is submitted in triplicate using the prescribed form.

In addition, another positive point for an investor is the ability to obtain local citizenship. If you intend to register a company in Cape Verde and are willing to invest US $ 30,000 in your own company, you can become a citizen of this country. Citizenship gives you the right to visa-free travel to all West African countries and makes it much easier to obtain a visa to Portugal.

If you decide to register a company in Cape Verde and open a bank account in Africa, you should read this material.

There are the following types of commercial organizations in Cabo Verde:

• commercial partnership (sociedade em nome colectivo);
• limited liability company (sociedade por quotas);
• Ltd. (sociedade anónima);
• limited partnership with shares (sociedade em comandita);
• cooperative (sociedade cooperativa).

Entrepreneurs who decide to start a business in Cape Verde often choose the LLC form. Doing business in Cape Verde traditionally starts with choosing the name of the business, as well as submitting a detailed description of the goals of the company to the registrar.

Those who intend to open a company in Cape Verde should take into account that the creation of a joint-stock limited liability company or a private limited liability company has some conditions:

• Sociedade anónima must have at least two shareholders;
• Minimum share capital of 2,500,000 local escudos (US $ 28,196);
• 30% must be deposited in cash with a local bank and the remaining 75% in cash over the next five years;
• Sociedade por quotas indicate in the constituent document 75% of the share capital, the number and value of the shares, and the amount of capital signed by each shareholder.

The minimum share capital is significantly less at 200,000 escudos ($ 2,256). Of the capital, 50% is also deposited in cash with a local bank. The rest is paid over the next three years.

Registration of a company in Cape Verde and opening an account in Cape Verde take up to 3-4 weeks.

It is not possible to open a company in Cape Verde remotely. While it is possible to register a company in Cape Verde online, it is not yet possible to obtain a Tax Identification Number (TIN) without a personal visit from the applicant.

It is worth noting that it is possible to open an offshore company in Cape Verde on a territory called the “Cape Verde Free Zone” which is specially designed for investors. Free zone enterprises are firms whose purpose is to manufacture and trade goods or services intended solely for export or sale to other companies in the same free zone.

For those entrepreneurs who are going to register a business in Cape Verde, the country offers some investment incentives:

• tax exemption for dividends and profits distributed over five years (or permanently if reinvested);
• after the end of the five years, the rate of income tax or distributed dividends is 15%.
• exemption from taxation of interest payments related to foreign investments;
• flat tax rate (10% after the sixth year of operation);
• exemption from all tax or other duties on income during the first ten years of operation.

Customs incentives:

• exemption from customs duties and consumption taxes in connection with imports;
• a special regime for the import of primary goods and some other materials;
• export is exempt from duties.

Limitations:

Incentives are not available to foreign investors who focus their economic activities mainly on the local market or who inject foreign investment into the financial sector regulated by specific legislation.

Tourist Utility Status (Estatuto de Utilidade Turística)

Cape Verde can grant tourism utility status to particular tourism projects. Tourism utility status is granted to the following types of tourism projects:

• Installation provided to new tourist resorts and facilities;
• Operation and maintenance of existing tourist resorts and facilities;
• Renovations are provided to existing tourist resorts and facilities in connection with improvement and expansion.

Tourist utility status generally allows for the following tax breaks and incentives:

• CIT credit for up to 30% of eligible investments made in tourism, tourism promotion activities, and investment in real estate tourism projects;
• Exemption from IUP for the purchase of real estate used for the construction and installation of tourism projects, if permitted by the municipality;
• Reduced the rate of 5% of customs duties on the import of materials and equipment used in tourism projects;
• Exemption from stamp duty on tourism investment.