DOING BUSINESS IN KYRGYZSTAN
For over a decade, Healy Consultants efficiently and effectively assists our Clients set up Kyrgyzstan businesses. To have more understanding about business registration in Kyrgyzstan, please see the details below:
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Advantages and disadvantages
Advantages of Kyrgyzstan company registration
- Kyrgyzstan has seen high growth rates in the majority of the past 10 years. Though the economy has been relatively sporadic, the mining, manufacturing, and energy industries have seen strong growth over the decade;
- Kyrgyzstan has a corporate tax rate of just 10%. Leasing companies pay a reduced rate of 5% while all companies engaged in gold mining or refinement pay no corporate tax;
- Compared to countries of the western world, it is worth doing business in Kyrgyzstan as it is very cheap, including food, transport, utilities, rent, wages etc. Specifically, utility costs and rent are significantly cheaper than in western cities;
- While Kyrgyzstan is landlocked, it is very close to two major markets – China and Russia. Kyrgyzstan has established strong trade relationships with both of these countries, in addition to several former soviet states, thus, it is easier in setting up a business in Kyrgyzstan;
- The government of Kyrgyzstan has declared attracting foreign direct investment a priority, with the Foreign Investment Law of 2003 providing quick and simplified procedures for FDI. For Kyrgyzstan investment, the government has put particular focus on allowing for financial freedom, protecting intellectual property rights and guaranteeing national treatment.
Disadvantages of Kyrgyzstan company registration
- Kyrgyzstan suffers from high corruption which can act as a barrier to completing many standard business practices and Kyrgyzstan company formation. Kyrgyzstan is ranked 123rd in the 2012 Corruption Perceptions Index by Transparency International. Entrepreneurs should expect under-the-table bribes in order to expedite business operations or during Kyrgyzstan company incorporation;
- Despite laws designed to protect foreign investment, any investment in Kyrgyzstan is risk-laden due to poor infrastructure and weak rule of law. Many foreign businesses have suffered destruction and other business expenses at the hands of local villagers when starting a company in Kyrgyzstan;
- English is spoken by only a small minority of Kyrgyzstani, with Kyrgyz and Russian being the official and most commonly spoken languages. Most official documents must be translated in to either Kyrgyz or Russian;
- Though property rights protections are emerging, the current judicial system is underdeveloped with little capacity to enforce. Licensing and registration are often a source of dispute during Kyrgyzstan business setup;
- Kyrgyzstan lacks investment and financial freedom, being ranked 89th in the 2013 Index of Economic Freedom by Heritage Foundation. Kyrgyzstan’s failing are due to a failure to consistently apply laws introduced to allow for increased financial freedom;
- Kyrgyzstan’s economic success has been strongly tied to the price of gold. Economic growth has been inconsistent, with negative GDP growth over consecutive quarters twice in the past 5 years.
- Kyrgyzstan free zone company is not available.
Best uses for a Kyrgyzstan company
- Kyrgyzstan has a wealth of natural resources. One of the world’s largest gold deposits and healthy reserves of coal allow the mining industry to make up 20% of the economy. Though all of the gold mines in Kyrgyzstan are state-owned, most operate through joint ventures with foreign companies.
- Time to incorporate: Four weeks
- Cost to set up: US$12,310
- Minimum capital: US$0
- Physical office required: No
- Shareholders: 1
- Directors: 1
- Company secretary: No
- Resident director: No
- Corporate tax rate: 10%
- Corporate tax base: Worldwide
- Shelf companies: No
- Main company type: LLC
Useful links for Kyrgyzstan
Government and public authority websites:
- Ministry of Finance
- Ministry of Foreign Affairs
- Central Bank of Kyrgyzstan
- Chamber of Commerce
- Kyrgyzstan airport
- Visiting Kyrgyzstan