Business entities in Algeria

Business entities in Algeria

Healy Consultants will assist our Clients with incorporating the optimum corporate structure in Algeria. As outlined in the table below, the most common business entity for foreign investors is the Algerian LLC (locally known as a SARL). However, foreign entrepreneurs may also choose to setup a PLC or a representative office in Algeria.

The Algerian limited liability company (SARL)

    Algeria business setup requirements for limited liability company (LLC)
  • The Algerian LLC can be incorporated with only 1 shareholder and 1 director, and requires a minimum share capital of US$1,000 (DZD100,000). However, Algerian Company Law disallows foreigners to hold a majority share (>49%) in Algerian companies, so our Clients will need a national to serve as their local joint venture partner for Algeria business setup. If needed, Healy Consultants will be pleased to provide our Clients with nominee shareholder services;
  • All LLCs with an annual turnover of less than US$120,000 will not be required to get their annual statements audited. All other LLCs are required to appoint at least one auditor, or are subject to a fine of up to US$12, 250.

The Algerian public limited company (SPA)

  • The Algerian PLC is required by Algerian Company Law to appoint at least 3 directors and 7 shareholders. At least one of the shareholders must be an Algerian national and locals must hold 51% of the company’s share capital. A deposit of US$10,000 (DZD1 million) is furthermore required as the minimum paid-up share capital for Algeria company setup;
  • In Algeria, it is not mandatory for a PLC to list on the stock exchange. The company must appoint an auditor out of a list of approved experts to act as a statutory auditor for three years.

The Algerian representative office (bureau de liaison)

  • While the Algerian government has forbidden foreign companies to incorporate branches, they can still run 100% foreign-owned representative offices, which can only engage in i) market research and ii) promoting the business of the parent company;
  • A representative office will require i) accreditation from the authorities every two years ii) US$20,000 deposit on a frozen resident bank account and iii) a convertible Algerian Dinars corporate account with a minimum deposit corresponding to 3 months of operating costs.

Table of comparison between different Algeria business entities types

 LLCPLCRep office
How long to set the company up?12 weeks12 weeks16 weeks
How long to open company bank account?4 weeks4 weeks5 weeks
Legal liability?LimitedLimitedUnlimited
Minimum paid - up share capital?US$1,000US$10,000US$20,000
File annual tax return?YesYesYes
Tax registration certificate required?YesYesYes
Recommended corporate bank account?ABC BankHSBC Algeria SPABNP Paribas el Djazair
Does our Client need to travel?NoNoNo
Resident director required?YesYesYes
Resident shareholder required?YesYesNo
Minimum directors allowed?131
Minimum shareholders?171
Algerian shareholder required?YesYesNo
Maximum foreign ownership?49%49%100%
Tax identification code needed?YesYesYes
Corporate shareholders allowed?YesYesYes
Corporate director(s) allowed?NoNoYes
Algeria corporate tax rate?26%26%26%
Annual financial statements required?YesYesYes
Statutory audit required?YesYesNo
Regulated by?Ministry of TradeMinistry of TradeMinistry of Trade
Allowed to issue sales invoices?YesYesNo
Allowed to sign contracts?YesYesNo
Allowed to import and export goods?YesYesNo
Can rent an office space in Algeria?YesYesYes
Can buy Algeria property?YesYesNo
Can own equity in other Algeria companies?YesYesNo
Total Algeria business setup costs in Yr. 1?US$12,450US$13,950US$11,350
Subsequent annual costs (incl. accounting and tax fee)?US$3,260US$3,260US$3,260
Sample engagement invoice?LLC setup costPLC setup costRO setup cost

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Contact us

For additional information on our business setup services in Algeria, please email us at email@healyconsultants.com. Alternatively please contact our in-house country expert, Mr. Simon Guidecoq, directly:
client relationship officer - Simon